Jersey is poised to introduce legislation enabling the establishment of foundations on the island fo...
Jersey is poised to introduce legislation enabling the establishment of foundations on the island for the first time.
Foundations will be available alongside existing vehicles such as companies, trusts and limited partnerships, for use in financial planning and private wealth management vehicles.
Unlike a trust, a foundation is a distinct legal entity similar to a company, although it has no shareholders. The powers of the foundation will be exercised by a council, where one of the members must be registered under the Financial Services (Jersey) Law 1998 to conduct business of this type.
The foundation's name and broad objectives must be set out in its charter, which will need to be lodged with the Registrars' department of the Jersey Financial Services Commission.
While similar in design to foundations available in other territories, Jersey has introduced a new concept of a guardian who will sit on the council that administers the foundation. The guardian will ensure the foundation achieves its broad objectives.
Under the Jersey legislation, it is proposed the founder of the foundation would be able to hold the post of guardian and council member, thereby permitting a greater level of control over the assets if required.
Geoff Cook, chief executive of Jersey Finance, said: "We anticipate that the foundation vehicle will appeal to clients based in civil law territories where they are less familiar with the trust concept, and it will also be an effective financial planning vehicle for those clients who want to maintain more personal control of the assets."
The new Foundations Law is subject to the approval of the States of Jersey Parliament before it can be formally enacted.
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