Guatemala Anonymous Bearer Share Corporations

Introduction to Guatemala Incorporation - Guatemala has excellent anonymous bearer share corporations, which can also be referred to as an Anonymous Offshore IBC. These corporations are legally referred to as S.A. or Sociedad Anonima. The corporations can also be called bearer share corporations in that the person who has possession of the bearer share certificates has the control and ownership of the corporation. Control can also be accomplished through the use of a General Power of Attorney, which we can provide in your favor or in favor of another person. This can be used if you want to have a lawyer somewhere execute a real estate transaction on behalf of the corporation.

The bearer shares can be kept anywhere in the world and can be made out in blank, or in the name of a natural person, or a corporation, foundation or trust. There is no requirement to report transfers of the shares. The names of the owners of the Guatemala S.A. Corporation does not appear in any public registry and the government of Guatemala does not know who owns the corporation. We provide a nominee director whose name appears in the public registry. The nominee director is a trusted person who does not know anything about you or your affairs. Nominee directors cannot cause you any harm or damages. There is also a nominee shareholder who owns 1% of the shares, usually one out of one hundred shares. We need two people in the public registry and one of them is never going to be you. Banks will not add, delete or change any signatories on any bank account without permission in writing of the existing signatories. Banks do not want to be sued for bank fraud. Nominees generally do not even know the account number of any bank account. You can make sure you are the only signatory at the bank by calling the bank before you put any money in other than the opening deposit which is $500 to $1500.

Guatemala Tax Information Exchange Agreements – Guatemala has no treaties that provide for any exchange of information for tax matters with other governments other than the other central america nations (Nicaragua, El Salvador, Honduras and Costa Rica). Guatemala has no tax treaties of any sort with any North American, Asian or European nation. No Tax Information Exchange Agreements and no Double Taxation Treaties. No EU withholding tax.

Guatemala Mutual Legal Assistance Treaties – None with USA, Canada, Australia, New Zealand, Asia Nations, and Europe. Guatemala would be likely to cooperate in cases involving: murder, kidnapping, child prostitution, abuse of children, genocide, narcotics and real terrorism. Guatemala does not support frivolous litigation regarding allegations of fraudulent conveyance of funds going into the Guatemala Bank account. Such an action in Guatemala brought by foreigners from another country claiming that funds were moved into Guatemala to place them out of the reach of creditors from another country would have practically no chance of success in Guatemala.

Foreign Judgement Enforceability in Guatemala – Guatemala is not in any treaties for the collection of foreign judgments. For starters if there is a judgment against a natural person from another country it is going to be extremely hard, if not impossible to try to execute a foreign judgment against a person, to a corporation in Guatemala. A corporation has it's own debts and liabilities. How can the judgment transfer? It really can't since it is not a debt of the corporation. Additionally, how is anyone going to know who owns the corporation since the names of the owners of a Guatemala Corporation are not in any public registry or database. The government does not even know who owns the corporation. Even if the other side knew you were the owner of the corporation that does not mean the judgment can be executed against the corporation. You and the corporation are two separate legal entities. So this is an extremely unlikely occurrence. We always have clients bank using anonymous corporations. These same corporations are used to own real estate, cars, stock brokerage accounts, businesses, etc. A foreign judgment taken against a Guatemala Corporation or person while in domicile in Guatemala is not going to be enforceable if it is a default judgement. How you get good service on a Guatemala Corporation being sued in a foreign court is a really complex question and is country specific. Does the foreign court have good authority and venue to start with. Does the merits of the case lend itself to good venue and authority in the foreign land? Did they get personal service on the corporation? This is a tough and expensive start for the plaintiff right off the bat. Legally a foreign judgment is not likely to be enforced in Guatemala, and any effort to do so is a most expensive and unlikely event. For a foreign judgment to be enforceable in Guatemala, the Guatemala judgment must be enforceable in that specific country. There are no treaties for this, so this is where the foreign judgments are most likely to become unenforceable. We will show you why more graphically.

Numerous Conditions Necessary for a Foreign Judgment to be Enforceable in Guatemala - Since Guatemala is not a party to any foreign judgment reciprocity treaties. This voids out the foreign judgments but we will go into deeper to make sure you understand how strong Guatemala is. Guatemala law will prevail in any effort to collect a foreign judgment. The foreign judgment must first of all be a final judgment not open to any appeals. Usually this means the judgment has to be 90 to 180 days old. The judgment must have resulted from a matter where there was direct personal service made on the defendant. This means a process server was used and handed the legal process papers to the person who signed for them. Service by mail, fed ex, publication in a paper is not valid service in Guatemala. Dropping them outside a closed door is not valid legal service. Taping the papers onto a door is not valid. Going into an empty house and reading documents to the four walls and taping the papers to a wall is not valid service. Ex parte orders done without serving you are not valid. This means if you were served in a such a way lacking personal service even though a judgment resulted, such a judgment would be invalid in Guatemala. This knocks out a very large amount of USA judgments that are done by mail, courier, and publication.

The judgment has to not be for default. In other words if you failed to respond to a foreign court action and were in domicile in Guatemala and they got a summary judgment that would not be a valid judgment. Wait it gets much better. If the judgment was for contempt of court it makes the judgment not valid in Guatemala. If a court ordered you to repatriate money from Guatemala to the home country so the court could seize it, you would generally be held in contempt if you failed to comply. This sort of judgment would not be valid in Guatemala. And it gets better yet. The violation of law that resulted in the judgment must also be a violation of law in Guatemala. Guatemala law is not as crazy as USA, Australia, and UK law so this again is going to present hurdles regarding any judgment enforcement. If even a portion of the judgment award is for something contrary to Guatemala law one could argue against the entire judgment.

If you were sued for sending out faxes that were unsolicited, this judgment would be void in Guatemala since they have no such law in Guatemala. Many USA lawsuits are for civil violations that are absent from Guatemala law. The foreign lawyer has to consult with a Guatemalan lawyer to see if the judgment is in compliance with Guatemala law. The plaintiff is now paying two sets of lawyers. Ok so now the Guatemalan lawyer needs to read the entire case, probably in Spanish but maybe he can proceed in English. This is going to take some billable hours just to read the file. Then comes the research into the Guatemala law books. Then discussions with the foreign lawyer.

The Guatemala legal system is not anywhere as onerous as USA, Canada or the UK. The obligation claimed in the foreign judgment must be considered to be lawful in Guatemala under Guatemala law. To prove this in court the entire court file that resulted in the judgment would need to be translated into Spanish by a certified translator. Sure a regular 6 or 8 inch thick file might not be a major expense figure maybe $10 to $15 a page. If the file was four feet high how much would that be? Oh it can easily get to be over $25,000. All the depositions, interrogatories, writs, evidence documents, pleadings, motions, decisions, complaints, findings, appeals etc need to be translated. If the lawsuit references cases then these cases will need to be translated in their entirety. A deposition that took most of an afternoon can be 150 pages alone. Paying over $10,000 for translation is not much. A seriously large case could run $50,000. If the case was based on rulings inconsistent with Guatemala law, then the judgment is not enforceable. There is a serious interpretative twist to this process that is prohibitive to a plaintiff looking for his recovery. Please bear in mind the defendant can appeal any negative decision from a lower court two ways. The defendant can appeal to the Supreme Court claiming the law was not followed correctly. He can also claim procedures were not followed correctly.

The other option is to appeal to the special Constitutional Courts Guatemala has to just decide constitutional issues. How hard would it be to argue that the defendant had some constitutional rights violated in the process somewhere. If all that fails after years of waiting for the process to work its way through the courts, then there is bankruptcy. Guatemala has a complex bankruptcy court system that could be utilized for shelter from creditors. Using these appellate processes is going to run up the bill for the plaintiff substantially think tens of thousands of dollars. Remember the opposition is paying lawyers from the country of the judgment plus Guatemala lawyers.Without the appeals system, the time required for cases can run up to the 3-5 year mark easily. Then add in appeals. and the bankruptcy. The plaintiff could conceivably go broke or die of old age before the appeals process runs out. They might recover nothing especially if a bankruptcy is used. The plaintiff might never prevail. The expenses involved could be more than the amount of the judgment. By the time all the appeals are used, the time limit for the judgment may have expired (7-10 years usually) and then the case could be dismissed because the judgment is not longer valid, thus not enforceable. And on and on it goes. Bottom line is how the heck is a creditor going to execute a personal judgment against a corporate entity? Answer – They have two chances, slim and none. Such collection efforts are indeed rarely ever seen because they are a waste of time and money.

Taxes – Guatemala does not tax offshore-derived income. If you receive money offshore to Guatemala there is no income tax on this money due to Guatemala. There is no tax on bank account interest if it is set up correctly using a corporation. The beauty is Guatemala is not considered a tax haven and thus is under the radar.

Time to Form a Corporation – Typically 3 working days for the preliminary corporate papers which are sufficient for bank account openings. One does not have to come to Guatemala to form a corporation. The corporations can be used to own real estate, cars, Guatemala Government issued and backed Bearer Bonds, and have bank accounts.

Identity Documents Required – One needs a photocopy of a valid passport sent as a scan is all.

Price - Guatemala S.A. Corporation only (no bank account) $3495. With Guatemala bank account $3995. Corporate renewal fees starting in year two is $700 and includes the registered agent, nominee and registered address.

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