PANAMA FOUNDATION LAW No. 25, June 12, 1995
"Whereby Private Foundations Are Regulated"
PART 2 of 4
THE LEGISLATIVE ASSEMBLY DECREES:
Article 10.
Once the foundation has obtained its juridical personality,
the founder or third parties that have pledged to contribute
assets to the foundation, on their own or at the request
of any person with interest in the foundation, shall
formalize the transfer to the foundation of the assets
so pledged. When the foundation is constituted to be
effective upon the demise of the founder, it shall be
deemed to have existed prior to such death, in respect
to the donations that he (she) may have made to the
foundation.
Article 11.
For all legal purposes, the assets of the foundation
shall constitute a separate patrimony from the personal
assets of the founder. Therefore they cannot be sequestered,
embargoed or subject to any precautionary action or
measure, except for obligations incurred, or for damages
caused by virtue of fulfilling the purposes and objectives
of the foundation, on behalf of the legitimate rights
of its beneficiaries. In no case shall the assets respond
for personal obligations of the founder or of the beneficiaries.
Article 12.
Foundations shall be irrevocable, except in the following
cases:
a) When the foundation charter has not been registered
at the Public Registry;
b) When the opposite is expressly established in the
foundation charter.
c) For any of the causes of revocation of donations.
The transfers (of assets) made to foundations shall
be irrevocable by whoever has made the transfer, unless
the opposite is expressly established in the act of
transfer.
Article 13.
In addition to the provisions of the previous article,
when the foundation has been created to be effective
after the demise of the founder, the latter shall have
the exclusive and unlimited right to revoke it.
The heirs of the founder shall not have the right to
revoke the creation or the transfers, even if the foundation
has not been registered in the Public Registry prior
to the demise of the founder.
Article 14.
The existence of legal provisions in inheritance matters
in the domicile of the founder or of its beneficiaries,
shall not be opposable to the foundation, nor shall
it affect its validity, or prevent the fulfilment of
its objectives as provided for in the foundation charter
or its regulations.
Article 15.
The creditors of the founder or of a third party shall
have the right to dispute the contributions or transfer
of assets in favour of a foundation, when the transfer
constitutes an act of fraud to the creditors. The rights
and actions of such creditors shall prescribe three
(3) years from the date of the contribution or transfer
of the assets to the foundation.
Article 16.
The patrimony of the foundation may originate from any
lawful business and may consist of present or future
assets of any nature. Periodic sums of money or other
assets may also be incorporated to the patrimony by
the founder or by third parties. The transfer of assets
to the patrimony of the foundation may be effected by
public or private document. Nevertheless, in the case
of real estate, the transfer must conform with the rules
for the transfer of real estate.
Article 17.
The foundation should have a Foundation Council, whose
duties or responsibilities shall be established in the
foundation charter or in its regulations. Unless it
be a juridical person, the number of members of the
Foundation Council hall not be less than three (3).
Article 18.
The Foundation Council shall be in charge of carrying
out the purposes or objectives of the Foundation. Unless
otherwise stated in the foundation charter or its regulations,
the Foundation Council shall have the following general
obligations and duties:
1. To administer the assets of the foundation, in accordance
with the foundation charter or its regulations.
2. Enter into acts, contracts or lawful businesses that
may be suitable or necessary to fulfil the object of
the foundation, and to include in such contracts, agreements
and other instruments or obligations, such clauses and
conditions as are necessary and convenient, which conform
to the purposes of the foundation and are not contrary
to the law, to morals, to bonus mores or to public order.
3. To inform the beneficiaries of the foundation of
the patrimonial situation of the latter, as established
in the foundation charter or its regulations.
4. To deliver to the beneficiaries of the foundation
the assets or resources set up in their favour by the
foundation charter or its regulations.
5. To carry out all such acts or contracts which are
permitted to the foundation by the present Law and other
applicable legal or regulatory provisions.
Article 19.
The foundation charter or its regulations may provide
that the members of the Foundation Council may only
exercise their powers by obtaining previous authorization
of a protector, a committee or any other supervisory
body, appointed by the founder or by the majority of
the founders. The members of the Foundation Council
shall not held liable for the 1088 or deterioration
of the assets of the foundation, nor for any damages
or prejudice caused, when said authorization has been
duly obtained.
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Panama Foundation Law 25 Articles 1-37, for the continuation....
