Why set up a trust in Switzerland?
Switzerland is a globally recognised financial centre where settlors can have the trust assets they establish managed with complete peace of mind. Thanks to its strong regulatory system and extremely solid legal structures, Switzerland has an excellent asset protection jurisdiction.
The solidity of the country’s system guarantees stability and security over time; legal certainty is recognised.
10 of Switzerland’s strengths:
2. Strategic geographical location
3. Stable, reliable political government
4. A cosmopolitan, international society
5. Liberal economic structure
6. Capacity for continuous innovation
7. Excellent infrastructure
8. Acknowledged financial solidity
9. Attractive taxation
10. Strong international relationships
The Swiss trustee
In Switzerland, the role of professional trustee is a supervised activity (which it is not in other European countries). The role of trustee is already regulated in Switzerland by the FinIA (Financial Institutions Act).
Professional trustees must have adequate capitalisation, internal control systems and risk management, as well as qualified trust managers. Trustees in Switzerland must also fulfil the due diligence requirements of the Anti-Money Laundering Act (AMLA) under the surveillance of the various supervisory bodies. These provisions comply with European regulations and FATF recommendations. Swiss trustees must also comply with international tax compliance regulations regarding the automatic exchange of information.
A trustee’s activities are already regulated in Switzerland by the FinIA (Financial Institutions Act), which entered into force on 1 January 2020. This legislation states that professional trustees are subject to a licence and must operate under the supervision of the FINMA (Financial Markets Supervisory Authority).
Link: Swiss trustees must also comply with international tax transparency regulations regarding the automatic exchange of information
Advantages and strengths of Swiss trustees
Swiss trustees benefit from the advantages of geographic proximity, the culture and language of Switzerland itself – a multilingual, multicultural country in the heart of Europe.
Being in a position to draft trust deeds in the language of the respective settlor is an impressive advantage for beneficiaries themselves – both now and in the future.
Compared to international trustees, who are based in all parts of the world, Swiss trustees make geographic proximity and contact with settlors their strong point, supporting them during both the establishment phase and the life of the trust itself, in order to assess settlors’ and/or beneficiaries’ new needs.
Thanks to periodic, regularly shared reporting, the ease of contact with settlors or any protectors enables trusts to provide continuous updates on the status of the assets under management.
Thanks to the transposition of the Hague Convention in 2017, Switzerland has officially introduced the use of the trust, although this has not been introduced into the national regulatory system; instead, it avails itself of the regulatory laws of other countries with Anglo-Saxon roots that fully recognise the institution.
Transparent pricing and speedy decision-making by the Swiss courts are an undeniable advantage for settlors, beneficiaries and all those involved in the deed itself.