By an amazing historical coincidence, calendar year 2010 is both a centennial and bicentennial for Mexico. This is great for students, as it’s a mnemonic device to help them remember dates! And as you might well imagine, it leads to 2010 being a great national celebration for Mexico.

Every nation needs symbols, traditions and celebrations to affirm its identity and pass its culture to the next generation. That’s why national holidays are important parts of national identity.

In Mexico, Independence Day (September 15th-16th) and Revolution Day (November 20th) are both important patriotic celebrations. And this year is special because it marks both the bicentennial of what became the Mexican independence movement (in 1810) and the centennial of the start of the Mexican Revolution (in 1910).

The dual anniversaries provide an opportunity to teach and reflect upon the complex and intriguing history of Mexico. And who knows, maybe even learn lessons for the future.

The bicentennial celebrates the independence of Mexico from Spain in the early 19th century.

The uprising that became the Mexican independence movement began in 1810, on the night of September 15th/16th. That’s the night that Catholic priest Miguel Hidalgo gathered the people in front of a church, where he gave a speech and rang a bell (similar to our own Liberty Bell), calling the people to action. This occurred in the central Mexican town of Dolores, Guanajuato, now referred to as Dolores Hidalgo.

Hidalgo himself was executed in 1811, but the struggle continued. Eventually, Mexico became independent from Spain in 1821. And that’s another historical coincidence, as 1521, 300 years earlier, was the year in which the Aztec Empire fell and Spanish rule began.

The Mexican War of Independence is not to be confused with the Mexican Revolution, which occurred a century later. The Revolution began on November 20th, 1910, as an uprising against longtime dictator Porfirio Diaz. After driving Diaz out of the country in 1911, revolutionary factions fought each other in a bloody civil war. The Revolution lasted from 1910 to 1920, more or less. (There is disagreement over its end point).

One of the most concrete results of the Revolution was the current Mexican Constitution, drafted in 1917. For Americans, the most famous figure in the Mexican Revolution is Pancho Villa.

Both Independence Day in September and Revolution Day in November are popular observances celebrated annually. This year is the bicentennial of the former and the centennial of the latter.

Therefore, in Mexico a number of observances are taking place this year, and not only in September and November. Current president Felipe Calderon has declared the entire year 2010 as the Año de la Patria (Year of the Nation). At the federal government level, planning began in 2006, during the administration of Vicente Fox, the previous president.

So this year, there are cultural, artistic and educational programs aplenty. There are historical commemorative ceremonies, artistic exhibitions, conferences and radio shows. Large digital countdown clocks have been installed in cities across Mexico. Major media companies Televisa and TV Azteca compete with each other to produce programming related in some way to the bicentennial/centennial. In 2009, the president lit a “Bicentennial Flame,” which is traveling around the country. Seminars have been scheduled, museums remodeled, archaeological sites opened, and books are being published.

Motorists traveling in many parts of Mexico can see the Ruta 2010 signs on the highway. These routes commemorate and follow military movements and historical figures in the Independence and Revolutionary periods. For a traveler interested in history, this would be a fascinating way to see where Mexican historical occurrences really happened. Those who are interested, click here.

Besides the federal government, the governments of all 31 Mexican states and the Federal District have their own Bicentennial/Centennial committees. In the northern state of Chihuahua, the bicentennial/centennial coincides with an even older anniversary — the foundation of Chihuahua City 300 years ago. (Really 301 years ago, as it was founded in 1709 — but that’s close enough). So Chihuahua has a triple celebration.

In June, the Mexican port of Veracruz played host to an international regatta featuring tall sailing ships, which had sailed in a five month voyage beginning in Brazil. The fleet included vessels from 12 nations, including Mexico and other Latin American nations, several of which are also celebrating bicentennials within the space of a few years. The US, Portugal and the Netherlands also participated.

There was even a sailing ship in the regatta from Spain, the country from which Mexico became independent. And why not? Back in 1976, the British participated in our US Bicentennial celebration by loaning us a copy of the Magna Carta for display.

The Mexican Bicentennial/Centennial is expanding beyond the nation’s borders. There are exhibitions of art from different stages of Mexico’s history in various foreign capitals. Mexican embassies and consulates are hosting cultural events abroad. There’s even a global mariachi contest, open to musicians of any nationality. In fact, one of the requirements of the mariachi competition is that contestants can’t be residents of Mexico!

On the Mexican government Bicentennial/Centennial website, a special message to readers, in English, explains some of the goals of the celebration:

“In 2010, Mexico will commemorate the bicentennial of its Independence movement and the centennial of its Revolution with an extensive program of events. All Mexicans and foreign citizens alike are invited to participate in these events to learn about and reflect on Mexico’s past… We will celebrate Mexico’s history in every corner of the country and abroad through a variety of means… These bicentennial and centennial celebrations are occasion for a big fiesta that all of society should make its own. Let the 2010 festivities bring us a new understanding of our past and unity for the future. Join us!”

And on that note, may all Mexconnect readers wish Mexico a happy Bicentennial/Centennial!

Allan Wall recently returned to the US after residing many years in Mexico.

The Panama Canal has always had to adjust to meet the demands of international ocean shipping. Not only has the size and shape of ocean shipping vessels changed, but the amount of traffic that the canal would see was grossly underestimated. It was originally estimated that the canal could support a maximum of 80 million tons per year. However, the reported traffic in the past few years has hit over 300 million tons per year. It has become apparent that it is time for some major changes in the canal system.

The demand on the canal has been steadily rising. Ships are getting too large to use the Panama Canal. Over half of the ships that use the canal now barely fit. Over 30% of cargo ships are already too big to use the canal. As ocean freight and cargo ships get larger, the canal will begin to lose its importance in the world trade market. This is why it has become so important that the canal, once again, adjusts to meet the demands of the market.

The Panama government has approved the project and construction began in 2007. It is expected to be complete and in full operation by 2015. The new expansion consists of six new locks, all operating parallel to the old Panama Canal. The new passage will allow cargo ships up to 1,200 feet long and 160 feet wide to pass. It is expected that the new expanded portion will make repairs and upkeep of the older part of the canal much easier.

The current Panama Canal has two lanes that operate independently of each other, allow ships to pass in two directions at once. The new, third lane, will allow larger ships to pass one direction at a time. Two new access channels will be built to route the expanded lanes to the locks. The locks will help to transport ocean shipping vessels up to the level of the Gatun Lake and then back down to sea level again. The new locks will be emptied and filled by gravity, the same as the old locks. However, the gates have a different construction and will be rolling gates instead of miter gates, which will be safer in the larger locks.

Miter gates are essentially doors that swing open to allow water to flow through. Roller gates are constructed of round steel drums, they are much stronger and can cover a much wider passage way. Because the pressure of the water creates the seal at the bottom and sides of the roller gate, it is considered to be much safer and is much less likely to leak. Roller gates can be raised above or below the water (depending on the type) and allow for clear passage without obstruction.

The growth and use of the Panama Canal has increased so much over the past few years that its profitability is feared to become stagnant. The expansion project is expected to help the Panama Canal handle new business and boost its viability in the ocean shipping market. With larger ocean freight vessels being supported and efficiency being increased, the Panama Canal project is expected to save it from becoming obsolete in the future.

The law governing Panamanian foundations is based on the law of the Principality of Liechtenstein. A Panama Foundation, however, is cheaper to set up, cheaper to maintain, more private and – perhaps most importantly – offers the utmost flexibility. While this structure is therefore a fairly new entity for Panama, the idea itself is not new. Foundations have been used as a family inheritance planning and asset protection tool in Continental Europe for more than a century so the nature of the Panamanian foundation is understood and appreciated by many continental Europeans.

The Panamanian Foundation offers some of the best benefits of both the trust structure and offshore corporation or IBC rolled into one. But in order to understand the idea and benefits of the foundation structure, you first need to be clear on the difference between a common law trust and a corporation.

It is important to note the difference between English speaking countries that use Common law (like the USA, UK, Canada, Australia etc) and many non-English speaking countries that use Civil Law or Napoleonic Code (for example France, Spain, Germany… and Panama).

Most businesspeople and investors understand the idea behind a corporation. Corporations are more commonly referred to as ‘Companies’ in British English, but it’s the same thing. Corporations are used everywhere in the world and operate along broadly similar lines. They are designed for doing business (not so much for holding assets, though they can also be structured for that purpose.)

The principal idea behind a corporation is that it is a separate legal entity, different from its owners or managers. It is what can be termed a juridical or legal person. Although of course it is not a human being, it has all of the rights and responsibilities of a human being under the law. It can, for example, sue or be sued in its own name. It can also sign contracts or take on debts in its own name, without creating a liability for its owners. The liability of the owners is limited to what they have agreed to put up as share capital.

That is the key point that we are interested in here: the assets and liabilities of the corporation are separate and distinct from those of the shareholders. Basically no court in the world can argue with that.

The trust, however, is a different kind of vehicle. Trusts are not designed to engage in business activities. They are designed for holding assets in safe keeping for a designated person or group of persons. The trust does not have a separate legal personality – instead the assets are registered in the name of the trustee. Common law recognizes, however, that the trustee is holding those assets for someone else. For example, if the trustee goes bankrupt, the assets he holds as trustee will not be involved in the bankruptcy proceedings. They will be kept separate.

There are two major problems with trusts:

? Problem number one is that as the Trust is a Common Law concept that does not exist in Civil Law, there can be conflicts of legal systems. If a country where assets are located interprets trust law differently from the country of residence of the person who created the trust, for example, you don’t need a wild imagination to see that the results could be catastrophic. With more and more people choosing to live, invest, retire and do business in more than one country, this problem is becoming more prevalent.

? The second problem is that trusts have also been attacked from all sides in recent years, even in Common Law countries. You may have heard about this in the news. Recent court cases in the USA, for example, have proven in my opinion that US judges either do not understand the essence of what a trust is meant to be or – more likely – have simply chosen to disregard the centuries-old trust law altogether in favor of public policy decisions like supporting the government, IRS, or greedy ex-spouses.

For this latter reason (in my humble opinion), any trust structure that is a domiciled in the US and some other common law countries is really not worth the paper it is written on. This is not to say that the laws in these countries are poor regarding these structures. The laws are good. The problem is one of interpretation and of courts not respecting the law. When your opponents don’t play by the rules, serious preparations are required. All in all, trusts are not the great asset protection vehicle they once were.

That is not to say there is anything inherently wrong with offshore trusts. On the contrary, they are an ideal vehicle for tax and inheritance planning in some circumstances. But with the number of jurisdictions in the world offering trusts, and all having tailored their laws and jurisprudence in slightly different manners, I will not enter into a comparison of good and bad types of trust here. Suffice to repeat that the main difference between trusts and corporations is that trusts are designed for holding and preserving assets, while corporations are designed for doing business.

Where, then, does the Panama Private Interest Foundation fit into this picture?

The Panamanian foundation offers the best features of a trust and the best features of an offshore corporation. Since there are no shares in a Panamanian foundation, it has no owners. The founder does not own the foundation and as such gains important tax reporting and asset protection benefits.

While the foundation cannot technically engage in business activities, it can own the shares of a company engaged in business activities. It is also permissible for the foundation to engage in any activity designed to increase the value of assets. This means that a foundation can be the owner of bank accounts, securities brokerage accounts and real estate holdings, for example.

Because many judges have taken the route of “re-interpreting” the law in such a way that Trusts are not as secure as they once were, the Panamanian Private Interest Foundation is worthy of consideration as an alternative. Foundations have some attributes that make them superior to trusts.

Clients who ask me in individual consultations about Panamanian foundations have many questions… but I have found that the most frequently asked question is: What’s the difference between a trust and a Panamanian foundation?

A Panama Foundation acts like a trust but operates like a company. It is, in essence, a company with beneficiaries instead of shareholders. Rather than trustees, the foundation is managed by a council which acts more like a board of directors.

Another way of describing it would be “an incorporated company without participating shareholders but still having limited liability.” The foundation is the owner of its own assets and functions in a codified legal system, which is less open to interpretation than common law (in other words, you know in advance the deal you are getting!)

Like a Panama company, the Panamanian foundation must have a local Registered Agent (lawyer or law firm) in order to establish its legal domicile in Panama. It also has the flexibility to move in and out of Panama in a similar way to companies that are able to change domiciles.

A Foundation is created by a charter, which is registered with the Public Registry in Panama, in the same way as a company. The terms of the foundation charter can be made as loose or as rigid as the client desires. The charter is typically written in such a way that its provisions can be easily altered to meet contingencies by means of ‘regulations.’

The charter is the only public document, and will typically include the names of nominees who serve as the Foundation Council. The typical (and most private) structure then appoints one or more ‘Protectors’ who might be the client or a trusted friend or professional etc. Typically, the Protector is responsible for the day-to-day operations, and operates through a Power of Attorney. The Protector is therefore the ‘main man’ who has sole signatory power over the bank and brokerage accounts.

The Protector is then responsible for appointing the Beneficiaries, in a private document. You might or might not choose to tell the beneficiaries directly. With suitably drafted statutes, the Protector is free to change the Beneficiaries – and pretty much anything else for that matter – at any time and without informing anybody. This in itself offers much greater flexibility than a typical trust.

All in all, therefore, it could be said that the Panama Private Interest Foundation offers better privacy, security and asset protection than a trust or fiduciary arrangement.

According to its management, the business strategy is to focus on asset management, offering clients a broad spectrum of offshore banking and financial services as well as offshore financial advice.

Credit Andorra is the leading private bank in the Principality of Andorra, where it has a 40 percent share of the Andorran retail banking market. The bank emphasizes professional service while working closely with family businesses, as well as small and medium-sized firms.

Miquel Valls Roca, President of Credit Andorra’s Panama operation, said that Panama would be the company’s gateway to Latin American opportunities. The opening of Banco Credit Andorra Panama is part of Grup Credit Andorra’s internationalization strategy, which seeks to grow and strengthen the company’s business beyond Andorran borders. The new bank sees Latin America as its best hope for expansion, given the common language and of course the threats to banking secrecy in its Andorra home market which may be scaring off its traditional European clientele.

The bank also has a new office in Montevideo, Uruguay, having received a license on December 20, 2008, where it is also the second Andorran bank present (Banca Privada d’Andorra, the smallest of the Andorran banks, has had a presence in Uruguay for some years).

Roca noted that Panama’s location and the area’s economic development were strong reasons to open an office here. The move, according to press releases, will also let the bank work with European clients who “want to develop projects in the area.”

Faced with new international challenges and paradigms, the Banco Credit Andorra Panama President acknowledged that the bank would adapt its services to be more advisory, with simpler banking products focused on risk management and global solutions.

According to Roca, Panama’s excellent compliance with international regulatory standards, such as those designed to prevent money laundering, was another key factor. He recalled the words of Panama’s superintendent of banks, Olegario Barrelier, who noted at the bank’s opening that Panama and Andorra are both small countries that have had to reinvent themselves in order to move forward.

The bank received its license last September, and executives are not ruling out developing other types of operations here in the future.

In 2007, Grup Credit Andorra reported 13 billion euros of managed assets with 638 million euros in reserve, a net profit of 128 million euros and 460 employees.

I have always enjoyed the morning chorus, the birds chirping just before dawn. It not only brings joy to the heart but is a sign that things are right with nature. I particularly enjoy hearing the morning chorus outside my apartment in downtown Panama City. There is a lot of concrete where I live close to a major Latin American banking district, the “Panama Bancaria.” However, there are also a lot of trees and the occasional vacant lot awaiting another high rise. The birds seem to cope pretty well and I enjoy the wild green parakeets that come to “chat” with our two caged Australian parakeets on the balcony.

The other frequent visitors are the little ruddy ground doves who, I suspect, only come to visit because the parakeets are messy eaters and there are seeds all over the balcony floor. There are bright blue birds, and red birds, and others that flit on past but don’t visit. The point of all this is that these guys are all chirping and flying and visiting in the depths of January when North American is covered with ice and snow. That would be Panama’s summer for those not familiar with Central America.

Falcons in the Bancaria

Ongoing concerns in Panama and elsewhere include deforestation, global warming from greenhouse gases, and the loss of species due to change of habitat. However, not all species are hurt by human activity and some habitats seem to be healthier than others. One particular species of lowland falcon, Milvago chimcima, the yellow headed caracara has extended its range and increased its numbers in open areas after forests are cleared. This bird is common from Southern Central America to Northern Argentina and is found on a number of Caribbean Islands. The Yellow Headed Caracara, however, is not a pigeon to be commonly found nesting in sheltered areas in cities. Thus, I was surprised on a recent Sunday afternoon when I heard a scree, scree out behind our apartment where the balcony faces the banking district across Via Espa?a.

The two parakeets were uncharacteristically silent. The ruddy ground doves, that spend their lives eating the seeds that the parakeets spill, were nowhere in sight. Looking down onto the roof over the parking lot next door I saw two yellow headed birds, roughly 18 inches from head to tail. They were preening, flying from spot to spot, and generally just hanging out. After half an hour these lowland falcons with the yellow heads flew away. A look on the internet told me that our visitors were yellow headed caracaras. These birds may be pretty common around Gamboa on the Panama Canal but the birds came from the cement streets and buildings between Via Espa?a and Calle 50.

Anyway, the caracaras flew away and, maybe an hour later, the parakeets started chirping again and the next morning the little doves came back to clean the balcony floor of seeds. I am of the opinion that Panama is not just a place where property values are currently low and not just a healthy place for Northern retirees to cluster. It is a healthy place for wildlife. Panama has more separate bird species that all of North America. Subsistence farms abandoned when folks move to the city for work have 30 foot tall trees in 10 years. All in all this is not just a good place to invest and do business. It is a place to rejuvenate while listening to bird song at dawn.

Panama is a 100% Tax free Haven. Non-resident Panamanian International Business Corporations (IBC’s) and Private Interest Foundations do not pay tax on any of their income (as indicated below), nor do they have any reporting requirements to the Panamanian government on non-Panamanian source income:

No income tax. No capital gains tax.No interest income tax. No sales tax.No tax on issuance of corporate shares. No tax to shareholders.No stock sale or transfer tax.No capital stock tax.No property tax. No estate tax.No gift tax. No stamp tax.No succession tax. No inventory tax.

For more information about setting up your IBC in Panama, please visit our website: http://www.confidentialbanking.com/jurisdictions-panama.html

There are many hotels and resorts available in Panama. One of these is sure to fit your budget and lifestyle.

Americas Best Value Inn – The Americas Best Value Inn is an ocean-front hotel only a block away from the Gulf World Marine Park. It is a four-story building consisting of 80 fully-furnished guestrooms. Some rooms have a private balcony that overlooks the ocean.

Guestroom Amenities:

Mini fridge
TV with premium channels
Multi-line phone with voice mail
Complimentary local calls
Microwave oven
Coffee maker

An outdoor pool is free to guests. Children are free to play in the playground.
There are many restaurants around the hotel.

Comfort Suites Panama City Beach – The Comfort Suites Panama City Beach provides good service with discounts on its normal rates. It is situated half a mile away from the many beaches in Panama City. Guests are treated with a complimentary breakfast served on a daily basis.

Guestroom Amenities:

Non-Smoking rooms
Sofa bed
Desk
Cable TV
Multi-line phone with voice mail
Complimentary high speed Internet access
Microwave oven
Refrigerator
Coffee maker
Hair dryer

Hotel Amenities:

Outdoor pool
Fitness room
24- hour front desk

Among the many attractions near the hotel are:

Hombre Golf Course
Shipwreck Island Water Park
Hidden Lagoon Miniature Golf
Gulf World Marine Park
Frank Brown Park
St. Andrews State Park

Country Inn and Suites Panama City Beach – The Country Inn and Suites Panama City Beach is less than half a mile from Signal Hill Golf Course, and less than a mile from the renowned Rain Forest Republic Zoo World. It is five miles away from the Florida State University.

This is a four-story building that houses 22 guestrooms.

Guestrooms Amenities include:

Large desks
Complimentary high-speed Internet access
Cable TV with premium channels
Complimentary local calls
Mini fridge
Microwave oven
Coffee and tea maker
Hair dryer
Iron and ironing board

Hotel Amenities includes:

Seasonal outdoor pool and spa tub
Complimentary continental breakfasts
24-hour front desk

Days Inn Panama City Beach – This hotel in Panama is a famous getaway in spring breaks. The hotel stands in the middle of more than 20 miles of beaches ideal for water activities such boating, fishing. Water is abundant with fresh seafood. An outdoor pool offers its guests a fun and relaxing splash on the water to escape from the heat.

Guestroom Amenities:

Dial-up Internet access
Cable TV
Free local calls
Refrigerator
Microwave oven
Non- smoking rooms

Days Inn is a seven-story property, with 188 spacious guestrooms fully-furnished with excellent interior designs for maximum comfort. Restaurants abound in the area, serving local and international cuisines.

Panama’s political economy is widely considered safe enough to buy and sell property however, there are some inconsistencies in Panama’s laws that can render an overseas property buyer’s investment lost. The key distinction lies in the types of property rights you have over your property investment namely titled and right of possession. Titled land means you have the right to live on and sell the land which is the most simple and straightforward property ownership in Panama. Right of possession property is land that you have been granted the right to live on it or build on it however you do not own the title to. Right of possession properties are most common rights given that most overseas property investment opportunities consist of off-plan blocks of luxury apartments.

Investors with rights of possession to have few problems as they can sell their land and the rights to a second party, and the land can be built on with little or no problems. However, it has been known for investors to lose their properties when unscrupulous land owners would use their influence to get senior civil servants to turn a blind eye to getting houses, with the right of possession, demolished in order to get the land sold to international commercial developers.

As a result of legal disputes concerning property rights, the Title Insurance industry has emerged in popularity allowing buyers to now have options giving substantial protection on their property investment. Although expensive in nature, the premium charged as a percentage of the property price, reflects protection offered in the minefields of Panama property [http://www.panamaventure.co.uk].

Therefore it is important to not only do legal research on the property developers and appraise the investment on the location amenities but to also take the relevant insurances in order to guard against serious losses.