Guatemala is one of the most secure offshore jurisdictions to choose from today. It has a number of unique features that make it an ideal choice for several key aspects of any offshore banking strategy. The first is the integrity of its banking secrecy laws. Banking law in Guatemala protects account holders assets and information from unlawful prying, so-called "fishing expeditions" and claims by third-party or foreign entities. Short of criminal financial activity such as money laundering, Guatemalan authorities will not permit the security and confidentiality of their banking clients' accounts to be compromised. Guatemala's banking secrecy laws are some of the toughest in existence.
The banks themselves are reputable institutions, with multi-billion dollar assets and good liquidity. There are a total of 18 banks operating in Guatemala today, including national banks and branches of foreign banks, with assets in excess of $15 billion USD. Banks are backed by the Guatemalan government.
Guatemala is the largest economy in Central America, growing 2.8% in 2010 and more than 3% in 2011, despite unfavorable global economic conditions. Guatemala's economy has long been stable, and inflation has been consistently low for decades. This creates a stable financial environment for foreign investment, which has grown to nearly 40% of GDP.
Foreigners can establish corporations, open bank accounts and conduct business with relative ease. Foreign investors enjoy the same legal protections as nationals, including private property rights and ownership in Guatemala corporations. There are no foreign currency controls or limits on the repatriation of capital. All of these protections and incentives have served to create a very favorable environment for foreign investment.
Guatemala's tax system operates on a territorial principle, so that only income earned on Guatemalan territory is subject to taxes. Offshore profits are not subject to taxation by the Guatemalan tax authority. Nor does Guatemala have any Double Taxation Agreements or Tax Information Exchange Treaties (TIEAs) with any other country; this serves to further reinforce Guatemalan banking secrecy laws. Guatemala is one of the few solid jurisdictions for which this is true; most other offshore jurisdictions have now signed tax agreements with other nations. Because Guatemala has not entered into any tax agreements, there are none of the vulnerabilities associated with the provisions for information sharing that these agreements can force upon signatories.
All of these factors combine to make Guatemala an outstanding offshore jurisdiction, with substantial assurances of privacy and security for offshore investors, a stable economic and legal framework, and some powerful instruments to use as key components of an overall wealth management strategy. So these are the reasons why Guatemala is a great place for an offshore corporation.
