Macau is finally taking the final steps of a long legislative journey to approve and implement a trust regime in Macau.

Generally approved by the Legislative Assembly of Macau, the new Trust Law (“Law”) provides the respective legal regime, which was absent from the laws of Macau, preventing the use of this legal figure, accepted in many jurisdictions of the worldwide by Trustees, Trustees and Beneficiaries.

The Law, which is still in the process of being legislated, intends to meet market expectations by offering a legal and safe net for wealth management through trusts. It provides for the definition, constitution and liquidation of the assets of the trust, as well as the capacity, rights and obligations of all parties involved, i.e. the trustee, trustee and beneficiary.

According to the law, a trust is a legal relationship under which the trustee transfers the rights to specific assets to the trustee, so that the latter manages them, as his own, with the interests of the designated beneficiary in mind, or to meet a specific need. goal.

The trust is formed by the execution by the parties involved of a private contract or by will, unless the assets to be part of the trust require a specific form of transfer (for example, real estate which requires a deed) . If so, these formal requirements must be met. Similarly, the formation of a trust is subject to registration if the transfer of the underlying assets must also be registered.

Although managed by the trustees as their own, the underlying assets of a trust must be separate and independent from the assets of the trustee, trustee and beneficiary. Credit institutions, insurance companies, financial companies, investment fund management entities, wealth management companies and pension fund management companies are the entities listed in Macau authorized to provide fiduciary services and to undertake fiduciary activities in the near future.

The new law specifically regulates the activity, rights and obligations of trustees, in order to protect the best interests of all parties. Strict compliance with the duties of diligence, loyalty, impartiality, confidentiality and information are part of the obligations that agents must respect.

On the other hand, any person or entity capable of disposing of their property and assets can set up a trust. Similarly, any person or entity – even the trustor – can be designated as the beneficiary of a trust. However, a trustee cannot be designated as the sole beneficiary. It will be permitted to designate several beneficiaries who will have equal rights to the assets of the trust in the absence of a specific rule providing otherwise.

The law also provides for the rights of the respective beneficiaries and heirs who, unless otherwise specified, will become the beneficiaries of the rights of the trust upon the death of the original beneficiary.

Finally, we have yet to understand how Macau’s tax laws, which are also under intense scrutiny by the legislature, will deal with the creation, termination and transfer of the rights of a trust.

In view of the above, the trust regime and this welcoming law will create significant opportunities for financial and wealth management market participants, improving Macau’s financial services accessible to the public.

Previous

TTG - Travel Industry News

Next

Company Growth Puts Multi-Academy Fiduciary Finance Specialists IMP Software in Pole Position for Future Expansion - FE News

Check Also