Guide to Guernsey foundations
The long-awaited Foundations (Guernsey) Law 2012 is now in force and the Guernsey Registry is accepting applications for registration.
This additional or alternative wealth management vehicle, and the structuring opportunities that accompany it, are likely to be of considerable interest to a wide variety of clients, in particular for those from civil law countries less familiar with trusts. It will also be of interest to those with existing foundations who are attracted to Guernsey’s G20 “white” list status and excellent wealth management reputation and who are looking to migrate their existing foundations from less well regulated or less convenient jurisdictions.
The Guernsey foundation is an incorporated entity with separate legal personality but which, unlike a company, does not have shareholders. Instead, it holds assets in its own name on behalf of beneficiaries, or particular purposes, or both, and it operates in accordance with a constitution comprising of a charter and a set of rules. Unlike a company, it cannot carry out commercial activities except those necessary for, or ancillary or incidental to, its purpose.1 As such it is an entirely new legal entity for Guernsey; it will look similar to a company but its operation is more akin to that of a trust…
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