The offshore discretionary common law trust ( rust offers significant advantages to aid in this purpose. Whilst it must be appreciated that this article cannot broach each and every subject on Trusts, equity, law and practicality, nor is it intended to be specific advice, it does have general informative value. Before one delves into complex trust and company structures in multiple offshore and international jurisdictions, it is important to have answered a few simple questions. These can be broken into the adage of hat is a Trust; Do you need a Trust; Which Jurisdiction should be used; and finally, How should you choose your Trustee
The trust as a concept has been around since medieval Anglo Saxon times. It has evolved over four centuries into a refined and legally recognized structure that has intrinsic asset protection features. The primary reason for this is that when a Settlor creates a Trust and settles property with a Trustee, the Trustee becomes the legal owner of the Trust Assets with a duty to administer these Assets for the benefit of the Beneficiaries who has an equitable interest in the Trust Assets. This division of rights is what makes the Trust unique. Besides the fact that the trust concept has enjoyed centuries of Common Law (English) legal development, leading offshore international jurisdictions like Bermuda have added significant statutory strength and recognition to its trusts and related structures. Internationally the trust concept is also given recognition in civil law jurisdictions (European) by operation of The Hague Trusts Convention. In other words the Trust is an internationally recognized structure from Common Law heritage that offers significant asset protection to various role players.
The next step is to identify whether a person circumstances actually warrants the need for a Trust. If a person has acquired or is in the process of acquiring significant wealth/assets, that person also runs the risk of losing that which he has acquired. There can be as many varying degrees of risk as there are individuals, for example the risk specific to a business, due to the loss of asset value, litigious/creditor actions, jurisdictional risk in the form of statutory governmental asset alienation (also known as sset grabs to name but a few. The higher a person exposure to risk the stronger the need for a robust asset protection structure that can be offered by implementation of a Trust structure. The final two questions of which jurisdiction and which institution is intertwined. The golden rule is to choose the best possible offshore jurisdiction for the intended structure. This translates into the jurisdiction with a stable government and economy, tax free environment, robust legislation and regulation, and independent judicial enforcement of that legislation. The intended jurisdiction will also need to have a wide choice of reputable banks and other financial institutions available, have a modern infrastructure, and be a springboard into international capital and security markets. The question of which institution to choose should follow the jurisdiction of choice. When seeking out an institutional Trust Company to act as professional Trustee regard should be had to the incumbent Trustee location, reputation, level of expertise, international resources and independence. A Trustee (and accordingly the Trust) is generally governed by its Proper Law (as elected in the Trust Deed) and jurisdiction (location) of the Trustee. The reputation and level of expertise can readily be gauged by applying due diligence principles to the Trustee. An institutional Trustee may have representation in various international jurisdictions which can be valuable in the creation of structures underlying the Trust and to facilitate cross border commercial transactions.
Bermuda is an internationally acclaimed offshore jurisdiction of impeccable standard. It boasts a significant economy and is home to the top global companies in the Insurance, Re-Insurance, International Finance, Trust and Corporate, Banking, Legal and Accounting industries. International Business is the backbone of the Bermuda economy. In December 2010, the Government of Bermuda signed a bilateral tax treaty in the form of a Tax Information Exchange Agreement ( IEA with the People Republic of China, which will significantly enhance the flow of business between the countries. St. George Trust Company Limited has been an independent entity since 1970. We started out as a private trust company and family office and later evolved into a public trust company
licensed to conduct unlimited trust business by the Bermuda Monetary Authority. We are a boutique Trust Company and our experienced management and staff offers a wealth of industry expertise, excellence and independence. Our ethos of excellence underpins the service delivery standard we set ourselves onto our customers. We remain independent from any other financial institution, bank, legal or accountancy practice which enables us to be truly independent in our fiduciary duty towards those we are appointed to serve.
