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International Trusts

What is a trust?
A trust is a legal structure that is created by a legal entity that can be either a person, company or any other legal entity, called a Trustor or Settlor, settling or entrusting some asset it owns to a legal entity called Trustee. The Trustee will manage and deal with the asset in accordance with the wishes of the Trustor for the benefit of persons designated by the Settlor as beneficiaries of the Trust.

In order for a trust to comply with the provisions of the International Trust Act of Seychelles, firstly, the trust must have a lawful aim or purpose, secondly, the asset given by the Settlor to the Trustee must have been owned by the Settlor and thirdly, the trust must be documented in writing signed by the Settlor and the Trustee.

What terms must be set out in the Trust Agreement?
The trust agreement must include the following:

• The purpose of the Trust
• A complete and accurate description of the asset
• Names and addresses of the Settlor, Trustee and Beneficiaries
• A complete description of the range of Beneficiaries
• The terms and conditions that will determine when a Beneficiary is entitled to obtain all or a portion of the
   Trust assets
• Terms setting out the authority of the Trustee to deal with the Trust assets
• Terms setting out how the Trustees are changed during the term of the Trust
• The term of the trust and the conditions for terminating the trust
• Compensation for the Trustee administrating the Trust

Who can be a Settlor, Trustee and Beneficiary named in a Trust and what are the rights/obligations of such parties?

Any natural person with full legal capacity and any other legally established entities with those specific qualifications that are set out in the regulations to the Trust Law.

A beneficiary must be either a natural person or a legal person or any other legally established entity.

A Settlor has the right to inquire into the status of the Trust and the management of the Trust assets. The Settlor can also request changes to the management of the Trust. In addition, the Trustee owes a duty to the Settlor to properly manage the Trust assets.

The Trustee must avoid any conflicts of interest and maintain separate accounts for their own assets and the Trust assets. The Trustee’s authority to manage the Trust assets is set out in the written Trust Agreement.

The beneficiary is the legal entity that is entitled to the benefit of the Trust assets. A Settlor can be a beneficiary, but the Trustee can only be beneficiary of a Trust if there is another beneficiary named in the Trust Agreement. A beneficiary is entitled to benefit from the Trust but the beneficiary can also renounce the Trust, transfer its rights to the trust assets and gift such rights by inheritance.


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