Private Trust Companies via the Jersey Shore
By Jeff Corbett
We often receive quires as to which jurisdictions – other thanSwitzerland– might offer a suitable location to structure a Private Trust Company (PTC). On the surface, the Channel Islands jurisdiction of Jersey seems to fit the bill. If you read on, however, you will see the not too subtle differences between a Jersey PTC and a Swiss Trust Company (STC) and why there is no comparison.
Jersey
It is difficult to resist the temptation to crack a “Snooki” joke here but somehow we will refrain. Jersey – theChannel Islands and original version – is not likely to be a place where she or any of her MTV reality show cohorts would find to be a desirable destination. The largest of theChannel Islands is a great tourist destination which exudes class and tradition. Jersey is an island nation which lies about 12 nautical miles fromNormandy,France and 87 nautical miles south ofGreat Britain. Is not part of theUnited Kingdom or the European Union but is treated as part of the European Community for trade purposes. The 2011 census totaled resident population at approximately 98,000. The name Jersey -going back to good old “Snooki” for one second – was whereNew Jersey got its title since it was owned by a local resident of the island at one time. Tourism and financial services are its major industries.
Related Links
http://www.jersey.com/English/Pages/default.aspx
http://www.youtube.com/watch?v=7wPkPxDyqvc
Private Trust Company
A private trust company (PTC) inJersey is a privately owned and incorporated company that may operate as a trust company. Typically, Jersey law requires any person who carries on trust company business in or from theIsland to apply to the Jersey Financial Services Commission (“JFSC”) to be registered to do so. This can be an expensive and time consuming process. There is, however, an exception which can expedite matters for ownership. Jersey law allows for those trust companies which will only administer services to a specific trust or related group of trusts to avoid the registration process. This would usually benefit a particular family with substantial common holdings or potentially a philanthropic trust. It may also assist in consolidating the administration of multiple trusts. Accordingly, in order to avoid the obligation to register, the activities of the PTC must be limited to being truly private inasmuch as it does not offer trustee services to the general public.
To qualify for a potential registration exemption the company needs to meet the following criteria:
- The company’s principle function must be solely to provide trust company services to a restricted list of specific trusts.
- The company will not solicit business from the public;
- The company will have its interests carried out by a qualified and registered Jersey Administrator.
Conclusion and Contrast
In summary,Jersey’s “light touch” approach to the regulation of PTCs means that such an entity may be incorporated quickly without burdensome and costly licensing procedures. Therefore, there can be no question that it has its benefits for the right client profile. Its extreme limitation on activities and who may benefit form services rendered, however, make it a pale alternative when compared to the Swiss Trust Company.
Posted in: Miscellaneous, Uncategorized on July 7, 2012
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