Guernsey has recently introduced its own Foundations legislation. Whilst the Island has a long established reputation for its trust infrastructure, Foundations will complement the existing fidcuiary offering and will be particularly attractive to clients less familiar with the trust concept – particularly those from civil law jurisdictions.
Foundations have not always enjoyed positive media coverage and being mindful of this the Guernsey legislation has set out to ensure that the vehicle includes the best attributes of those based in other competitor jurisdictions with appropriate safeguards for beneficiaries in line with the regulatory environment the Island offers to companies and trusts.
A Foundation is often described as a hybrid of a company and a trust. The Guernsey foundation is an incorporated entity with separate legal personality but which, unlike a company, does not have shareholders. Instead, it holds assets in its own name on behalf of beneficiaries and/or purpose. It looks similar to a company but its operation is more akin to that of a trust.
The new law also incorporates provisions for migrating existing Foundations from other jurisdictions into Guernsey.