A trust set up in Hong Kong can last forever if you do not terminate it, which means your assets would be protected by a trust for an unlimited period. However, you can always terminate it if you are subject to a revocable trust (s3A Perpetuities and Accumulations Ordinance Cap. 257).

The Law of China strictly restricts transfer of assets to other countries. In most cases, assets held in China cannot be transferred to an offshore family trust directly. If these assets are held or will be held by an overseas company, you can consider having your trustee hold that overseas company on trust for and on behalf of you. Our legal department will assess whether or not that is feasible and provide alternatives which fit your situation.

Family trust is a type of private trust. A family trust is any trust vehicle that you’ve set up to benefit members of your family. The family trust is a popular vehicle in estate planning. You know your family best, and a family trust can help you customize how you provide for your family, both during your lifetime and after your death.

The initial trust property of a family trust can be:

· Current assets (e.g. cash, securities, fund units)

· Fixed assets (e.g. land and real estate, art, antiques and collectibles)

· Contracts and agreements (e.g. including insurance contracts, private contracts, commercial agreements)

Benefits of a Family Trust:

· Avoid expensive court certification procedures for probate of the Will while the estate might be being frozen during the probate period.

· High confidentiality. Estate information does not become a public record like a Will.

· Promote family harmony since family trust is very difficult to refute or challenge.

· Prevent squandering money for pleasure in the next generations. Family trust can distribute the property exactly as you want to avoid future generations being profligate.

· Scalable. the establishment can increase assets at any time as needed, and the establishment of a “durable power of attorney” to designate someone to deal with in times when they cannot manage the transaction.

· When the establishment loses the legal physical and will judgment ability, it is not necessary to appoint an asset manager through a certified court.

The custodial trust service provided by One Fiduciary Services Limited can act as a firewall of property. According to Section 89 of Chapter 29 of the Trustee Ordinance, the trust assets are a separate fund that is not part of the Trust Company’s property. Furthermore, the legal title of trust assets is the trustee, who is responsible for managing the trust assets in accordance with the terms and special duties imposed on him. If the purpose of the trust is not illegal and the trust period is more than 5 years, the chance of the trust assets being claimed is low.

No. All the investment powers and asset management functions will be reserved by you. You are also obliged to assign a new trustee or revoke the trust deed anytime provided that you are the settlor of a revocable trust.

Your assets will then be distributed in accordance to s4 Intestates’ Estates Ordinance (Cap. 73). The family members of the deceased have to apply for a death certificate and then they can apply for a grant of probate at the high court. Rule 21 Non-contentious Probate Rules (Cap 10A) provides that where a person dies wholly intestate, the persons having a beneficial interest in the estate shall be entitled to a grant to administration. For instance, the surviving spouse, children or parents of the deceased.

If you have set up a trust which is managed by a licensed trust company, the trustee will distribute the trust assets in accordance to his or her wishes when the settlor dies. The beneficiaries do not need to go through all kinds of expensive and long statutory procedures. You also do not have to choose an executor(s). To avoid any dispute in the future, you are advised to make arrangements when you are of sound mind.

1) High compliance regulation

Trust service in Hong Kong has a history of more than 100 years and are regulated by the Hong Kong Trustee Ordinance, which mirrors British Trust Law. Hong Kong trusts are also protected by the Hong Kong Recognition of Trusts Ordinance of which The Hague Convention also applies to it. Trust licensed companies in Hong Kong are directly monitored by the Financial Secretary of the Hong Kong Special Administrative Region.

2) Independence of the trust asset

Section 89 of Chapter 29 of the Trustee Ordinance stipulates that all money, property and securities received or held by any trust company as a trustee shall always be kept separately from the money, property and securities of the company. Each trust is marked in the account book to distinguish it from any other money, property and securities in the company’s register and other account books. Therefore, no trust money shall form part of the company’s assets or be mixed with the company’s assets at any time . The client’s assets will never be used to repay the debts of the trust company according to the Article 11 of Cap. 76 Recognition of Trusts Ordinance. Therefore, the trust assets are protected in law and not affected by the collapse of the Trust Company.

Yes. Trust regulation has predominantly evolved upon Common Law and equitable principles where fiduciary duty is the overarching requirement. In contrast, banking regulation is typically based on well formulated rules and regulations which govern almost all actions and reporting requirements which banking institutions need to follow to the letter.

Arguably, trust regulation provides the trustee with greater flexibility in terms of actions which it can execute on management of trust assets and in its reporting requirements. Trust regulation will often allow settlor and beneficiaries to maintain a significantly higher level of discretion.

From application of Common Law and equitable principles, the legal title of assets vested under trust (subject to certain timeline constraints) will no longer be in the name of the original contributor but be transferred to the trustee. Hence, personal creditors of the settlor or claimants under matrimonial, family feudal or other civil litigation will not be able to claim the assets under trust. Unlike under banking regulation, customers’ assets are under personal or corporate legal title which means there will be less legal protection from any legal challenge or claimant against the assets of the person or corporate.

One Fiduciary Services Limited is regulated by a high standard legal and compliance department and fulfills all legal requirements. In accordance with Section 2(1), Chapter 1 Section 2(a), of the Trust Recognition Ordinance (Cap. 76), the assets of the trust are an independent fund, held in the name of the trustee, and the client and asset information is confidential. All trust management and operation will be carried out in the name of the trustee (One Fiduciary Services Limited), the assets and contents of the trust are strictly confidential and will not be disclosed to any third parties.

s95(1) Trustee Ordinance provides that the Financial Secretary may at any time appoint an inspector to investigate the affairs and management of any trust company if it appears to the Financial Secretary that there are circumstances suggesting that the Trust Corporation is in breach of trust, persons concerned with its formation or the management of its affairs have in connection therewith been guilty of fraud, misfeasance or other misconduct towards it or towards its members or the Trust Corporation is insolvent etc.

s95(2) further provides that all officers and servants of the company have the duty to produce all books, accounts, vouchers and other documents in their custody or control in relation to matters under investigation, and to answer truly all inquiries addressed to them respecting any matter affecting the affairs of the company.

Anyone. You, as a settlor of the trust, can also be the beneficiary of your own trust. According to Section 2(c) Recognition of Trusts Ordinance (Cap. 76), if you have not decided who will be the beneficiary/beneficiaries of your trust, you can always assign a class of persons as your beneficiaries. For instance, your children or grandchildren.

Section 89 of Chapter 29 of the Trustee Ordinance stipulates that all money, property and securities received or held by any trust company as a trustee shall always be kept separately from the money, property and securities of the company. Each trust is marked in the account book to distinguish it from any other money, property and securities in the company’s register and other account books. Therefore, no trust money shall form part of the company’s assets or be mixed with the company’s assets at any time . The client’s assets will never be used to repay the debts of the trust company according to the Article 11 of Cap. 76 Recognition of Trusts Ordinance. Therefore, the trust assets are protected in law and not affected by the collapse of the Trust Company.

Under section 41Y of the Trustee Ordinance (Cap. 29), the validity of transfer of movable assets would not be affected by the foreign law of succession. For immovable property, clients should make a transfer in accordance with the law of the country where the property is situated.

Yes. You can assign a class of persons as your beneficiaries. For instance, your children or grandchildren. Under s46 Trustee Ordinance (Cap. 29), where any interest in land is subject to a contingent right in an unborn person or class of unborn persons who, on coming into existence would, in respect thereof, become entitled to or possessed of that interest on any trust, the court may make an order releasing the land or interest therein from the contingent right, or may make an order vesting in any person the estate or interest to or of which the unborn person or class of unborn persons would, on coming into existence, be entitled or possessed in the land.

The custodial trust service provided by One Fiduciary Services Limited can act as a firewall of property. According to Section 89 of Chapter 29 of the Trustee Ordinance, the trust assets are a separate fund that is not part of the Trust Company’s property. Furthermore, the legal title of trust assets is the trustee, who is responsible for managing the trust assets in accordance with the terms and special duties imposed on him. Therefore, if you are involved in matrimonial proceedings, the assets which are held in your trust account will not form part of your matrimonial property. Furthermore, if the purpose of the trust is not illegal and the trust period is more than 5 years, the chance of the trust assets being claimed is low.