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Bahamas Foundation

The Bahamas is a collection of seven hundred islands and cays located in the Atlantic Ocean. The Bahamian economy is based on tourism which contributes to about two thirds of gross domestic product, followed by the financial services sector, providing about 15% of GDP. Bahamas’ offshore financial services cover many types of offshore entities such as the Bahamas Domestic Limited Company, Bahamas Foreign Company and Bahamas International Business Company.

The Bahamas Foundation in particular, was created in 2004 by the Foundations Act. The Bahamas Foundation is a legal offshore entity endowed with corporate attributes that make Bahamas offshore foundations a secure tool for protecting personal and business assets.

Bahamas foundations are utilized for many purposes which range from the establishment of charities or philanthropic organizations, planning estate and one’s taxes, and segregating assets. Based on the structure of a Bahamas offshore foundation, it also allows for holding and better management of assets, which helps with preserving the wealth of a family or business.

The assets of a Bahamas foundation may originate from any lawful business and may consist of present or future assets with a substantial monetary value and should be exclusively managed, invested and disbursed in accordance with the foundation charter, or its articles (if any).

Offshore foundation registration in the Bahamas gained momentum over past years due to the low capital (US$10,000 minimum) and no reporting requirements imposed on Bahamas offshore foundations. A Bahamas foundation is exempt from tax in the Bahamas, is legally recognised and accepted both within Latin America and Europe and established as a legal entity with domiciliation in the Bahamas. Other uses of Bahamas foundations include its ability to own fiduciaries (trusts) and be subsidiaries of an international business companies (IBCs).

Bahamas foundations benefit from the stipulations established in the Fraudulent Dispositions Act of 1991 and do not recognize forced heirship, which is typical of Islamic countries and jurisdictions where civil law is practiced. The founder of a Bahamas foundation may also exercise authority over the other officers (foundation council or board) of the Bahamas foundation.

Bahamas foundation offshore service providers offer a number of services relating to the formation and maintenance of Bahamas foundations. These include the preparation of the Bahamas’ Foundation Charter (Articles are optional), provision of a nominee founder, foundation secretary and officers services, accounting services and the provision of the members of the Foundation’s Council.

Bahamas foundation registration is similar to the incorporation process of a regular international business company in The Bahamas. Bahamas foundations consist of a founder, beneficiary and foundation council. When registering a Bahamian foundation, the selected name must be accepted and confirmed by the Registrar General. Once accepted, a foundation name can be reserved for a period of three months or ninety working days. The name of a Bahamian Foundation must be original and cannot be the name of an existing Bahamas company, Foundation or corporate entity except if the organization is in the process of liquidation, or a company that is registered in the Bahamas. The name of a Bahamian Foundation cannot include the expressions “Imperial”, “Bank”, Stock Exchange”, “Insurance”, “Windsor”, “Co-operative”, “Trust” or “Royal”.

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