The Republic of Panama has the fastest growing economy and the largest per capita income in Central America. It is the business and financial hub of Latin America, partly due to its canal and its 'Hub of the Americas' airport that makes it so easy to fly in and out, with direct flights from all of the Americas, Europe and the Middle East.

NTL Trust's office in Panama serves two purposes:

• Representation of the NTL Trust group's services into the Latin American market

• Provision of local Panamanian services to clients in other parts of the world.

As substance becomes of prime importance in international planning, Panama fits the bill. In Panama there are few bureaucratic hurdles and the cost of doing business is low. It's also easy to obtain a residence permit in Panama. As such, Panama makes a great base for internationally mobile entrepreneurs who can easily maintain a residence and business substance in a tax-friendly jurisdiction.

• Panama has a territorial tax system which means that income is only taxed if it derives from Panama. Therefore, no tax is payable when income is obtained from a source outside Panama, even if the business is run from within Panama.

• The incorporation process is quick and the ongoing maintenance costs are minimal.

• Minimal reporting requirements. No audit is necessary.

• Corporate assets or capital of a Panama company can be kept outside Panama.

• There are no residency requirements or restrictions with regards to owners, directors or shareholders.

• Shareholder and director meetings may be held and the directors may attend personally or by proxy.

• No restrictions on shares. Shares may be held in registered or bearer form.

• No paid up capital requirement.

• No inheritance tax.

• No currency exchange controls.

• Legal protection provided for confidentiality of business and banking transactions.

• Excellent infrastructure and communications.

Panama corporations can be used for international trade, to settle trusts or foundations, to establish an offshore bank account or offshore investment account, to hold ownership of real estate, intellectual property, or to hold any other type of assets.

An important factor in tax planning is that Panama Corporations are by default resident in the Republic of Panama and this substance can be further enhanced by using local professional directors and by obtaining a local/municipal business licence. As such, there is much less potential for legal discussions over the place of residence of a company, when compared to traditional IBC jurisdictions.

The Panama Private Interest Foundation is, in our opinion, one of the best legal vehicles in the world for patrimonial planning. The 1995 law is modeled on that of the Principality of Liechtenstein.

Essentially, a Foundation is a way of giving legal personality to a specific asset or series of assets. These assets are then managed by a Foundation Council, appointed by the Founder, but the assets no longer have owners since the Foundation becomes the legal owner of the assets.

In many ways a Foundation is comparable to a trust, but the fact that a Foundation (unlike a trust) is a legal entity in its own right, gives added protection, flexibility, and clarity especially when it needs to conduct business with third parties.