Luxembourg: A New Trust Jurisdiction?
Author: Paolo Panico
Publication date: 14/09/2005
Topics Covered :
Paolo Panico TEP, is Adjunct Professor of Applied Economics and Internationalisation Processes at the University of Modena, Italy. He is equally a faculty member of SDA Bocconi, Milan, the leading Italian business school.
On the professional front he is the Deputy Chairman of the international holding company of an Italian private banking group and in that capacity he holds non-executive directorships in several companies based in a number of countries.
As of 1st January 2004 the Hague Convention on the Law applicable to Trusts and on their Recognition of 1st July 1985 came into force in the Grand Duchy of Luxembourg. Trusts have therefore obtained a full right of citizenship in a further civil law country, after the successful experiences of Italy, the Netherlands and Malta.
By the same token, the domestic regulation of Luxembourg fiduciary contracts was amended in such a way to fit the definition of “trusts” under the Hague Trusts Convention and therefore to qualify as the civil law equivalent to a trust.
A pragmatic and effective legislation allows to consider the Luxembourg fiduciary contract as a possible alternative to other international fiduciary arrangements, especially in a financial context.
This book provides an accurate and updated coverage of Luxembourg fiduciary contracts and their main applications in the context of banking transactions, financial security arrangements and securitisation.
The alternative forms of fiduciary set-ups available under Luxembourg law are equally surveyed with a comparative perspective. At the same time, the book provides an extensive coverage of the use of trusts in Luxembourg, with a specific focus on case law, tax issues and banking practice.
The taxation of trusts under the European savings Directive 2003/48/EC of 3rd June 2003 is specifically dealt with, as well as the interplay between the Luxembourg banking secrecy requirements and disclosure duties under the “know your customer” regulations currently in force. Some practical issues as regards banking operations involving trusts are dealt with in some detail.
Chapter 1 : The Luxembourg Legal System: A Few Historical Remarks
Chapter 2 : Fiduciary Relationships in Luxembourg Prior to the Hague Trusts Convention
Chapter 3 : Trusts and Fiduciary Contracts in Luxembourg under the Law of 27th July 2003
Chapter 4 : Fiducie Sûreté and Transfer of Title by way of Security
Chapter 5 : Tax Treatment of Trusts and Fiduciary Contracts under Luxembourg Law
Chapter 6 : Trusts, Banking Secrecy and “Know Your Customer” Rules in Luxembourg
Chapter 7 : Securitisation and Security Trustees in Luxembourg under the Law of 22nd Mar 2004