LAV ECO

LT D.

Legal Solutions since 1991

The Trust

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LAV ECO

LT D.

Legal Solutions since 1991

www.laveco.com

What are the main reasons for establishing a Trust?

The Trust is one of the most important tools in modern-day asset protection.
Favourable tax treatment
Forced heirship laws
Continuity on death
Preserve property in the family
Protection of assets from creditors and divorced spouses
Confidentiality or discreet asset holding
The secure deposit of assets.

The concept of the Trust generally

A Trust is created when an individual (the Settlor) transfers his assets or part of his assets to
another individual or corporation (the Trustee(s)) to control and manage the assets on behalf
of a further specified individual or group of individuals (the Beneficiaries).

Parties to a Trust
The Settlor is the person who creates the Trust.
The Trustee is an individual or corporation who holds and manages the assets in accordance
with the Deed of Trust and Letter of Wishes on behalf of the Beneficiaries and, in the event of
certain circumstances, divides the assets/profits between the Beneficiaries.
Beneficiaries are the persons named by the Settlor to benefit from the assets placed in the
Trust.
The Protector is usually a trusted friend, private lawyer or a professional adviser of the Settlor,
whose role is to protect the interests of the Beneficiaries.

What assets can be transferred to the Trust?

Shares and stocks in both quoted and unquoted companies

Investment portfolios
Real and intellectual property
Bank deposits
Life assurance policies issued on the life of the Settlor
Other types of asset

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Status
The Trust is a legal relationship created by the owner of the assets or other property (Settlor)
and the person(s) willing to undertake the office of trustee (Trustee(s)), and take legal
ownership of those assets for the benefit of other parties (Beneficiaries) under the terms of the
Deed of Trust.
The trust is not a company: can not be a Controlled Foreign Company. The Automatic
Information Exchange treats Trust separately from companies.
Although the Trust is not a separate legal entity,
it can open bank accounts, and
it can be a shareholder in a company. In this case shares are registered in the name of
the Trustee, but it is stated that the Trustee holds the shares for the benefit and on
behalf of the Trust.

Establishment of a Trust
When an individual decides to set up a Trust they will arrange for their assets or a part of their
assets (the initial settled funds) to be transferred to the Trustee(s). An agreement or deed will
be prepared which sets out the duties and powers of the various parties to the Trust.

How does the Trust work?

Once the Deed of Trust has been duly executed and the assets have been placed in the Trust
the Settlor ceases to be the owner of the assets, since they will be legally held by the Trustee(s).
The Trustee(s) shall control and manage the assets and any income arising from those assets in
accordance with the provisions of the Deed of Trust and on behalf of the Beneficiaries.

The most popular jurisdictions in Europe for offshore Trusts

Alderney
Jersey
Gibraltar
Cyprus

Guernsey
Isle of Man
Malta
Liechtenstein

LAV ECO

LT D.

Legal Solutions since 1991

www.laveco.com
worldwidecitizenship.com

Accounts and record keeping

The Trustee(s) is/are responsible for maintaining the records of the Trust and
preparing the accounts.
The accounts of the Trust are not available to the public.
The Beneficiaries are entitled to request information about the accounts from the
Trustee(s).

Reportable person in case of Trusts

Settlor
Trustee
Beneficiaries.

Automatic Information Exchange

Reporting requirement only arises in cases where a distribution from the Trusts assets is made
to the Beneficiaries. When a Beneficiary receives a loan from the Trust there is no reporting
requirement.
For additional information please visit our site
www.laveco.com
or contact one of our offices worldwide:
+359-2-953-2989
bulgaria@laveco.com

+40-21-311-6176
romania@laveco.com

+357-24-636-919
cyprus@laveco.com

+248-4-322-261
seychelles@laveco.com

+ 852-2388-8051
hongkong@laveco.com

+44-207-556-0900
london@laveco.com

+361-456-7200
hungary@laveco.com

israel@laveco.com

The information contained in this brochure is not comprehensive and is only of a general informative nature. The information should
not be considered as a concrete offer, or investment or taxation advice. We accept no responsibility for any damages which may occur
as a result of its use.