We usually employ Panama for the majority of our Trust work, the legislation there being amongst the most comprehensive in the world. Panama Trusts are totally private, the Trust document does not have to be registered and there is no public inspection, there is no taxation of Trust income and assets can be settled after a Trust is formed and Trusts established within Panama jurisdiction are governed by Panama laws, one of which is that it can over-ride that of other countries, i.e., a 'foreign' court order that a Trust (or Trustee) should be liable for payment of damages will be overturned by a Panama Court.

Offshore Trusts are very personal arrangements and we must have detailed information on the purpose of the trust, its Settlor, assets being transferred and the beneficiaries (if any) before we can form one. Rest assured however that any details provided will be TOTALLY CONFIDENTIAL and all details of you and your trust are held offshore themselves.

Please e-mail us if you would like further details on Trusts, or of Panamanian Foundations, a similar type of legal structure but based on Panamanian Civil Law.

OFFSHORE TRUST - COSTS

Because of the very individual nature of trusts, we are unable to give specific Trust Formation costs at this stage, but Kaizen's 'standard' Offshore Asset Protection Trust starts at under US$1,350. We would point out that the vast majority of Trusts we execute are 'standard'.

In addition, an annual Trust Maintenance Fee is payable to Trustees, which starts at around US$1000 for a standard trust, however there are ways of reducing this substantially (down to US$500) by the Settlor acting, under a Power of Attorney, as a Trust Manager on behalf of the Trustees - an option we find utilized by over 50% of our Trust Clients. If the Settlor appoints his own Trustees, there is of course no annual Trustee Fee payable to Kaizen.

We also have a number of 'standard' Offshore Asset Protection Trust / Offshore Company / Offshore Bank Account packages available. These packages are formulated to meet the requirements of the vast majority of clients and, as an illustration, would typically cost US$3,000 for an Offshore Asset Protection Trust with the Settlor acting as Trust Manager (under a PoA), a BVI Company with a Corporate Nominee Director and its shares owned 100% by the Trust with the Settlor acting as Company Manager (under a PoA), a reference-free Offshore Bank Account with Internet banking for account management from any PC and an International ATM Debit Card. This package price includes all formation and incorporation costs together with all the first year company and trust management fees and represents a saving of over US$500 on the individual item prices. Please e-mail us for further information.

Please bear in mind the privacy, financial security and freedom from taxes that a trust can bring - those are worth many times the cost!

OFFSHORE TRUSTS - ASSET PROTECTION TRUSTS

'Offshore' Trust Answers
We have already mentioned some of the major problem areas relating to the use of Asset Protection Trusts (APT) created within the home jurisdiction. To re-cap, these are the high risk of compromising and penetration of both home country (domestic) Asset Protection Trusts, Family Limited Partnerships and Limited Liability Companies by the courts, especially in the U.S.A.

The main problem with a domestic APT is that in order for a Settlor to enjoy the full benefit and security of the Trust, he must renounce control or benefit from the Trust absolutely. If you are both Settlor and Beneficiary, you are leaving yourself wide open to claims by your creditors that the Trust is a sham and you are willfully seeking to defraud them.

The courts will rapidly see through such a situation and the Trust will be declared a sham and nullified. With a domestic APT you cannot safely have your cake and eat it!

'Offshore' Trust Answers
The answer to these problems can be solved by the careful use of an Offshore Asset Protection Trust (OAPT). We say 'careful' however since it is still of vital importance that two major criteria are met. These are:
(1) Jurisdiction
(2) Comity

In this context, jurisdiction means the authority to administer justice in a specific geographical area. A correctly structured OAPT in the correct jurisdiction will be totally beyond the reach of the US courts.

Comity means that the courts in one jurisdiction, even if unconnected politically with another country, will recognize and accede to a ruling made in the courts of another country. It is therefore vital that the OAPT is located in a jurisdiction where this does not apply. The offshore jurisdiction must both be able to (and do) turn round to the US courts and say "this is not our concern, there is no jurisdiction here, we do not recognize and will not implement your ruling".

Advantages
There are therefore many advantages to placing assets in a correctly structured Offshore Asset Protection Trust.

The very fact that your assets are legally held in an offshore jurisdiction outside the control of the courts makes them an unattractive target to creditors. Just imagine the hurdles that face a creditor in commencing a legal action in a jurisdiction perhaps thousands of miles from home against an entity that according to the laws of that jurisdiction has done no wrong.

It may be relatively easy for the creditor to get the Settlor into a court and have a satisfactory judgment pronounced, but being able to action and enforce that judgment in a foreign court and pursue the assets is a very different matter.

From experience, the more 'modern' offshore jurisdictions have state-of-the-art Trust legislation which has been designed knowing what may face it yet at the same time be 'Settlor friendly'. There are a number of such jurisdictions scattered about the globe, but it does pay to examine each in turn.

Jurisdictions?