In June 1995, Panama achieved a milestone by enacting Law No. 25, which regulates Private Interest Foundations—a legal framework inspired by Liechtenstein’s model but adapted to global needs. Thirty years later, this legal tool has not only proven its robustness and versatility but also reaffirmed our jurisdiction’s ability to innovate with strategic vision in the field of international wealth planning. During the 1970s and 1980s, Panama had already emerged as a financial and legal hub thanks to its efficient corporate legislation, particularly the widespread use of corporations (sociedades anónimas). However, Panama’s legal community, with a forward-looking approach, identified a gap: the lack of a legal instrument allowing families and entrepreneurs to organize, protect, and transfer their wealth wealth with flexibility and legal certainty. Thus, a visionary group of Panamanian lawyers began studying Liechtenstein’s foundation model—a hybrid structure combining elements of Anglo-Saxon trusts with the legal entity framework of civil law, specifically designed for asset preservation and intergenerational transfer. This model offered benefits that traditional trusts could not provide in civil law jurisdictions, such as a more formal structure, independent legal personality, and statutory regulation.
Beyond Business: A Legacy Vision
The adoption of the Private Interest Foundation was far more than an exercise in legislative import. It was not a mere replica of the European model but rather the expression of an evolution in Panama’s legal vision: shifting from a purely commercial logic to a familial and wealth-planning approach. Over these three decades, Private Interest Foundations have enabled families, entrepreneurs, and international clients to structure their legacies in a more humanized manner, reflecting their values, continuity goals, and the protection of loved ones. Panama introduced elements of flexibility, confidentiality, and operational simplicity that made it especially attractive to clients from Latin America, Europe, and beyond, solidifying the country’s position as a leading jurisdiction for wealth planning.
A Lasting Impact
Panama’s Private Interest Foundations remain a cornerstone of the nation’s legal and fiduciary offerings. Their use has expanded beyond asset preservation to include succession planning, philanthropic endeavors, and asset protection against legal or geopolitical risks. This anniversary invites us not only to celebrate groundbreaking legislation but also to reflect on the responsibility to continue innovating—developing modern, ethical, and transparent legal structures that meet the challenges of new generations in an increasingly complex and demanding world.
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