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Seychelles unique legal system Seychelles legal system: Common Law and Civil Law Seychelles Financial Services can offer asset protection solutions for entrepreneurs from both Common Law and Civil Law countries: Trusts for Common Law countries Private Foundations for Civil Law countries China – Civil Law Hong Kong – Common Law
Securing future via Trusts and Foundations Asset Protection: To protect assets against creditors, excessive taxation, political instability, forced heirship rules Family: For succession management, to protect closely held businesses providing continuity into second and third generations, to protect minors, disabled persons; to manage payments or distribution of assets to family members, to provide for their education, housing Business: Pension and employee benefit schemes; a vehicle for the collection of royalties; to hold shares in private and public companies Charitable: To carry on religious, philanthropic, humanitarian or educational purposes, or to manage funds or assets for such purposes Investment: To own real estate or other assets of considerable value such as Art works, to invest in shares, bonds, bank deposits, mutual funds
What is a Private Foundation? Separate Legal Entity A hybrid of a Company and a Trust Holds assets under Foundation’s name
Private Foundation Founder Foundation Assets Beneficiaries Charter&Regu lations Council Protector Transfers assets to Foundation
Advantages of Private Foundation Asset Protection: the assets of the foundation cannot be used to satisfy the debts of the Founder or of beneficiaries. Where the assets have been transferred to the Foundation and out of the reach of creditors, claims must be made within 2 years. Neither the foundation nor transfer or property to a foundation shall be void, voidable Arbitration: The Foundation Charter may provide that any dispute arising in connection with the foundation be resolved by arbitration, thus avoiding the public sphere of litigation Capital Requirements: A minimum of US$1 of assets must be transferred to the Foundation. there is no public records of the capital amounts other than this minimum transfer, so the sum of total assets held by the Foundation remains confidential
Advantages of Private Foundation Privacy: Beneficiaries are not publicly known Foundation can be shareholder of record of the underlying Companies Taxation: No taxes payable in Seychelles The transfer, donation of assets to the Foundation is not subject to any tax in Seychelles, neither is the modification, dissolution of the Foundation. Income generated by the assets is not subject to taxes in Seychelles
Advantages of Private Foundation Control: Founder can amendment Charter Regulations, appointment/remove Councillors, restrict beneficiary rights and entitlement, can add or exclude beneficiary, etc Founder can be one of the Councillors Protector may be appointed by the Founder or the Foundation Council with authority to remove the approve actions of the Foundation Council and remove Councillors Founder may transfer his rights and powers to third party Recognition: Recognised in all common and civil law jurisdictions
Structure Example China Business HK Co Foundation
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