How to Protect your assets in countries that do not Enforce foreign judgment
Countries around the world depend on and often expect other jurisdictions to enforce a court judgment issued in one’s home country and in return, the same request is also expected to be granted for foreign countries, this is a policy known as reciprocity.
While most countries recognize the need to collaborate and be seen as a reliable international financial partner, there are certain countries around the world that do not have the same view
Why countries do not reciprocate foreign judgments
There can be a number of reasons why a foreign judgment is not recognized in another country.
The most common reasons include:
- Lack of reciprocating treaty, which means that when a country (requestee) that is expected to enforce the judgment of the requesting country (requester), does not have any legal framework in place that would guarantee judgments of the requestee from being applied overseas, the request to enforce foreign judgment is often rejected.
- Laws in the foreign country are not in line with the home country’s regulations.
What happens when countries do not apply foreign judgment
Foreign judgment can be enforceable, if both countries have reciprocated treaties, which would allow the each other to enforce legal judgement granted in the other’s.
A foreign judgment can be considered as a point of reference, however the legal case would need to be litigated again, in the country where the judgment is to be enforced.
Foreign judgments often need to be in line with the country’s law, where the foreign judgment is requested to be enforced, in order to be considered and applied.
Countries that do not apply foreign judgment
Foreign judges are generally not recognized in the below list of countries, which makes opening an offshore bank account ideal.
This list of offshore countries that do not apply foreign enforcement should only be used as a point of reference, as regulations change from time to time.
- Opinions expressed on this page regarding reciprocating treaties should not be taken as legal advice, and proper legal consultation with the lawyers in relevant industries should be undertaken.
| Country / Jurisdiction | Foreign Judgement Applicability | Possible to open offshore bank account? |
|---|---|---|
| Argentina | Enforcement possible but often difficult with frequent rejections. | Coming soon. |
| Belize | No recognition for trusts | Yes |
| Brazil | Recognition possible but time intensive and often denied. | Coming soon. |
| China | Requires treaty or reciprocity, most foreign judgments rejected. | Yes. |
| Cook Islands | No direct recognition | Yes. |
| Ethiopia | Only with countries that have reciprocity treaty, many rejected requests. | Coming soon. |
| Indonesia | Foreign judgments only evidence / point of reference, case must be re-litigated. | Coming soon. |
| Japan | Requesting countries often fail reciprocity test, leading to enforcement being denied. | Coming soon. |
| Kenya | Only judgments from small list of countries are recognized. | Coming soon. |
| Laos | Most foreign judgments not recognized due to lack of reciprocating treaty. | Yes. |
| Marshall Islands | No automatic recognition of foreign judgment. | Coming soon. |
| Nevis (St. Kitts & Nevis) | No direct recognition and foreign creditors must file a new claim in St Kitts, as the country is one of the toughest asset protection laws, making offshore banks in St Kitts ideal for asset protection. | Yes. |
| Nigeria | Does not have reciprocity treaty with most countries, which makes a large amount of foreign judgments unenforceable. | Coming soon. |
| Oman | No general recognition mechanism; reciprocity rarely met. | Yes. |
| Papua New Guinea | Must file a new case with local courts in P.N.G. | Coming soon. |
| Samoa | Foreign judgement must be re-litigate locally in order to be enforceable in Samoa | Coming soon. |
| Saudi Arabia | Highly restricted. | Coming soon. |
| Seychelles | Foreign creditors have to relitigate the case as there is no automatic enforcement. | Yes. |
| Sudan | No general recognition as local court regulations restrict enforcement of foreign judgement. | No. |
| Thailand | Foreign judgments are not enforceable and must re-litigated in TH. | Yes. |
| United Arab Emirates | Only enforceable in DIFC/ADGM are exceptions, which practices English common law | Yes. |
| Vietnam | Only possible with countries that have a reciprocating treaty, otherwise foreign judgments cannot be enforced. | Yes. |
How offshore banking can protect assets
Offshore banks in foreign countries that do not enforce foreign judgment provide an additional level of asset protection, since any foreign creditors looking to claim your assets will need to relitigate the case in a local court.
An offshore bank account enables customers to align the strategy with lawyers and other service providers to optimize their asset protection strategy.
Best countries to open an offshore bank account for asset protection
Certain countries on this list do not enforce foreign judgments while others do.
A properly structured legal setup will enable customers to benefit from each country’s asset protection benefits. Professionals such as lawyers, tax advisers and accountants are key in determining which offshore jurisdiction is best for asset protection.
Offshore bank accounts can be opened in the below jurisdictions without the need to have any nexus (physical ties) to the country.
This means that foreign companies registered overseas, are not required to have any customers, employees, suppliers or office in the country where the international bank is located.
Private individuals that are looking to open a bank account in a foreign country, do not need to hold any residency permit, employment visa, job offer or study permit, and are still able to open bank accounts without any relations with the country where the offshore bank is located.
| Andorra | Antigua | Armenia |
| Austria | Bahamas | Bangladesh |
| Belize | Brazil | Bulgaria |
| BVI | Cambodia | Cape Verde |
| Cayman Islands | China | Comoros |
| Cook Islands | Curacao | Cyprus |
| Dominica | France | Georgia |
| Germany | Gibraltar | Greece |
| Guernsey | Guyana | Hong Kong |
| Hungary | Isle of Man | Jersey |
| Kazakhstan | Laos | Latvia |
| Liechtenstein | Lithuania | Luxembourg |
| Malaysia | Mauritius | Monaco |
| Montenegro | Mozambique | Namibia |
| New Zealand | North Macedonia | Oman |
| Panama | Poland | Portugal |
| Puerto Rico | Romania | San Marino |
| Serbia | Seychelles | Singapore |
| Slovakia | Spain | Sri Lanka |
| St. Kitts and Nevis | St. Lucia | Switzerland |
| Taiwan | Thailand | Turkey |
| United Kingdom | United States | Vanuatu |
| Vietnam |
How BUH consulting can assist
Our team will work with you to understand your requirements, eligibility criteria and apply for your business and personal bank account with the most suitable banks and assign relationship managers that can assist with the onboarding process for your offshore bank account.
Contact information
For a tailored solution, contact us to discuss about your requirements.
Email: – sam@buh-consulting.com
Phone: +971585086656
Whatsapp: +971585086656
Telegram: BUHConsultingAE