(The Hear Up) Due to the consequences of globalization and therefore the advancement of the latest technologies, the likelihood of doing business outside our borders of residence has become progressively viable; the event of the world economy has favored that small and medium-sized enterprises now have a multinational scope and invoice part of their production outside their country of origin.
This new situation and the greater geographical reach of these companies has also led them to a new situation with different degrees of complexity and greater business risks.
Given this new scenario, it is logical that these entrepreneurs seek a safe place, with political stability and favorable jurisdiction, in order to protect their personal assets. In other words, they need to generate a structure that can give them and their families peace of mind in the hypothetical case that business went bad and thus avoid family ruin
One of the legal instruments that can help these entrepreneurs to protect their personal assets and generate peace of mind in the future is the asset protection trust, which we will talk about in the following article.
What is an asset protection trust?
The concept of asset protection involves a broad spectrum of legal instruments for this purpose, in principle, any trust where it is established that the funds are kept freely available could be placed within this category.
Panama is a favorable jurisdiction to generate this type of trust since the country provides financial security, political, economic stability, tax, tax advantages, and confidentiality.
The choice of jurisdiction will depend on the circumstances of the person, and it is for this reason that the advice of an experienced law firm and connoisseur of fiduciary legislation is essential, as is the case of Central Fiduciary.
Who is it for?
We have started the article talking about businessmen or entrepreneurs who do business in other countries, but this legal figure is not only intended for this type of profile.
Basically, anyone with a moderate or giant internet value will take pleasure in this plus protection.
It is also common in professionals who can be involved in litigation more easily than other professions such as doctors, builders, lawyers or investment managers, to name a few.
There are certain people who by their profession and their bulky heritage are more likely to receive lawsuits; Regardless of your guilt, the plaintiff knows that you can take more economic advantage of a lawsuit and that is where the trust can help you legally protect your fortune.
How does this asset protection strategy work and is implemented with a trust?
The essence of this strategy is that these assets are not readily available and recoverable in the case of legal proceedings against them by suppliers, customers, employees, family, etc …
Although the bank accounts themselves already provide good privacy, they are in general a part of the structure for the protection of assets, which together with the trusts and the laws that govern them offer this figure larger confidentiality and security.
The bank secrecy laws in offshore jurisdictions like Panama are usually much more stringent than the laws of your country unless there is suspicion of money laundering or criminal activity.
This trust agreement is constituted when the settlor (who constitutes the trust) transfers assets to the trust and legally gives control of his assets to the trustee (Central Trust), who manages and controls these assets in favor of one or more beneficiaries ( among which the settlor maybe).
When should I set up this trust?
We always talk about providing, safeguarding, protecting in case of contingencies, so it is important to highlight that it is not something that we should implement when there are already
imminent or in progress legal actions against this heritage that we would like to shield.
Any decision to transfer assets once there square measure close or in progress legal actions against those assets are thought of a fallacious act.
