Category Archives: African Tax & Money Havens

Liberia Foundation – Introduction

The Liberian foundation, modeled on the 1993 modern Austrian law of foundations (Stiftung), is a useful and flexible vehicle, used for various purposes, including charitable, public and personal.

Treasure Chest

Liberia have since WWII been one of the worlds largest and most well reputed international shipping bases. Many of the worlds leading cruise operators, tanker owners etc. are formally based in Liberia. Legal entities like a foundation is an expansion of the types of legal vehicles available from this jurisdiction.

Similar to all foundations, the Liberian private foundation is a separate legal entity and all assets transferred to it, usually in the form of a gift by a donor, are irrevocable and the sole property of the foundation. The private foundation is established through the memorandum of endowment, and an initial endowment (Donation/Gift). The donor(s) cannot withdraw the assets once they are donated or endowed to the foundation. The assets are placed at the disposal of the foundation.

Treasure Chest, Courtesy of Wiki Commons

As with the donor, there are no statutory restrictions on the residency or nationality of the officers or secretary. Moreover, there are no requirements for assets to be located in Liberia.

There are minimal filing requirements with Liberia, thus protecting the privacy of the beneficiaries and the donor. Once formed, there is a mandatory annual return for the privatefoundation, which must be signed by the Secretary and submitted to Liberia. The annual return confirms that the information filed in the extract is correct and that proper accounts are maintained. Liberia does not require submissions of financial accounts, nor are they required to publically file such information. Any changes or amendments to the extract must be filed with Liberia.

A foundation domiciled outside Liberia may, if permitted to do so by its constitution, apply to migrate its domicile to Liberia. In the same way, Liberian law allows for conversion of any recognised entity to a private foundation, provided its own constitution allows for this.

Liberia imposes no gift tax on the donated assets at the time the private foundation is established. Moreover, any income generated by the assets of the private foundation is exempt from tax in Liberia. However, there may be tax implications for the beneficiaries in their respective places of domicile for any income they receive.

In conclusion, a foundation is useful for preserving wealth and for asset protection, and allows for flexibility in international tax planning. The above gives a brief overview of  how a Liberia foundations.

Countries With Capital Controls

We have compiled a list of countries that currently have capital controls. However, notice that Belize have a two system economy. The local banks and the local economy with capital

Great Blue Hole Belize

controls,and the international banks with their international clients with no capital controls.

To some extent this is “more or less” the case with some other countries as well, like for example Cuba and Malaysia.


Great Blue Hole in Belize, a paradise for foreingers. Phone courtesy of Wiki Commons

Here are the countries with capital controls in alphabetic order:

Ecuador (1
Mexico (2
South Africa
South Korea


1.) Ecuador taxes you 5% on every wire, check, ATM or visa/master card transaction you make outside of Ecuador.

2.) Mexico have a limit on cash US Dollar transactions. However, Mexico is mainly a cash society.

Let us know if you are aware of updates to the countries mentioned above or other countries that should be added to the list.

Billions hidden in South African banks by Gadaffi

Early morning sunrise over the city of Johannesburg. Picture by Dylan Harbour.

The hunt for slain Libyan dictator Muammar Gaddafi’s missing billions has moved to South Africa, where a fortune in cash, gold and diamonds is believed to be stashed.

The investigators believe there is evidence of more than $1-billion in cash, gold and diamonds being held by four banks and two security companies in South Africa.

Early morning sunrise over the city of Johannesburg. Picture by Dylan Harbour.

The Sunday Times has established that Libyan investigators have already met top government officials to discuss locating, securing and repatriating the loot brought here by Gaddafi and his children.

It could be the largest haul of Libyan assets found until now, although it is only a fraction of the estimated $80-billion of Gaddafi’s foreign assets.

It has been established that the Libyans:
■Met President Jacob Zuma in Pretoria on December 10 2012;
■Held a follow-up meeting with Zuma at Nkandla on April 20, which was also attended by Libyan embassy official Salah Marghani and Zuma’s cousin Sibusiso “Deebo” Mzobe;
■Met Finance Minister Pravin Gordhan on April 26; and
■Wrote to Justice Minister Jeff Radebe on May 9 for help tracing and securing the loot and preventing “illegal attempts [to] move the funds”, sparking a probe by the Asset Forfeiture Unit.

A follow-up letter sent by ANC head of security Tito Maleka on April 23 confirms that the visit “with our president in Nkandla” is an indication that “the South African government is prepared to cooperate” in “identifying all assets belonging to the Libyan people”.

Marghani confirmed this week that the Libyan investigators had met Zuma and Gordhan.

Zuma’s spokesman Mac Maharaj said that Zuma “was approached by a group saying they represented the Libyan government. They were referred to the National Treasury”.

Gordhan’s spokesman, Jabulani Sikhakhane, also confirmed that the National Treasury was approached by the group.

“The process of verifying the group’s claim is under way,” said Sikhakhane.

The National Prosecuting Authority, parent body of the Asset Forfeiture Unit, said it was “not in a position to comment at the moment”.

Some of the information investigators are using to trace the funds is understood to have come from Libya’s former intelligence chief, Abdullah al-Senussi, who was arrested in March 2012 for crimes against humanity. He is in jail in Libya awaiting trial.

The Libyan investigators declined to be interviewed. But Marghani said they had “been appointed to investigate and secure assets in Africa on behalf of the people of Libya”.

This is confirmed by letters from Libya’s justice and finance ministers to their South African counterparts. The letters ask for cooperation in tracing and securing “all funds and assets that have been illegally possessed, obtained, looted, deposited or hidden in South Africa and neighbouring countries by the late Muammar Gaddafi, his wives, his sons, his daughters and other relatives, close associates, private and government [or] business persons in Africa”.

The letters say that the Libyan investigators have “uncovered large funds and assets in South Africa and neighbouring states”.

See the full story in Times Live here.

Tax & Money Havens

American companies are living the United States because of high taxes

The corporate tax rate in the United States is the second highest in the developed world.

American companies are finding new overseas tax havens to legally protect some of their profits from the U.S. tax rate of 35 percent, among the highest in the world. Lesley Stahl reports. Move your corporation or part of your corporation out of the United States while it still is possible. Do not wait as the current negative sentiment could result in restriction on US companies in the future.

See the video covering the story at:


Libya’s hidden wealth

According to The New York Times “As the battle for Libya rages on, the struggle over control of the country’s sovereign wealth fund and its $70 billion in assets has just begun.

The fund’s nominal head is Muhammad H. Layas, perhaps Libya’s most experienced international banker. He has had a leadership role in institutions including the Libyan Arab Foreign Bank, the only bank allowed to conduct international business during the imposition of United Nations sanctions against Libya; British-Arab Commercial Bank, a London-based wholesale bank now majority owned by Libya; and the Arab Banking Corporation, a Bahrain-based bank also majority controlled by Libya.”

See the full story in The New York Times here.