Guernsey Foundations

Guernsey has long been recognised as one of the leading jurisdictions for the delivery of trustee services. A trust is essentially an Anglo Saxon concept and it is sometimes difficult for individuals to accept the concept of giving away legal ownership of their assets to a third party trustee. This is particularly true of those who come from civil law countries, where the concept of the trust is not readily recognised. In response to this, Guernsey introduced a new Foundations Law on 25 July 2012, with a view to providing a trust style financial planning vehicle to individuals from countries such as South America, Mainland Europe, China and Russia.

Key Features

A Foundation is in many ways similar to that of a company in terms of having a legal persona but it is also similar to a trust in that, essentially, it is an asset holding vehicle to benefit persons or specific purposes. Specific features are:-

  • They are readily understood by civil law clients
  • They are ideal for family succession planning structures
  • They can hold wide-ranging assets such as real estate, stocks and shares, bank accounts etc.
  • There is wide flexibility to structure foundations to the specific needs of the individuals and families establishing them.




  • A Council There must be at least two Councillors, one of which is a Guernsey licensed fiduciary.
  • Constitution and Rules All Foundations must have a constitution which is split up into the charter and the rules. These documents set out key aspects such as the name, duration, initial capital and anything else required by the Founder.
  • The Founder The Founder is the person who sets up the Foundation, introduces the capital and sets out his or her requirements to be incorporated into the constitution and rules. The Founder does have the ability to reserve certain powers to himself, which would tend to include the ability to amend or revoke the constitution during their lifetime.
  • Registration Once established, the Foundation must be registered with the Guernsey Registrar. This would include the name, charter, names and addresses of the Councillors and other key data.
  • Legal Position A Foundation has a legal personality similar to that of a company. This means it can be sued and the assets of the Foundation belong to the Foundation not to the Council, Founder or beneficiaries. Key parties such as Councillors have to act in the best interests of the company rather than the beneficiaries. By contrast, if a Guardian is appointed, they do owe duties to the Founder and the beneficiaries to protect their interests under the charter.
  • Beneficiaries Like a trust, these can be either named or identified as a member of a class. Unlike trusts however, beneficiaries can either be enfranchised with rights to access details of the Foundation or disenfranchised. This is a unique feature to the Guernsey Foundation and allows families to block certain beneficiaries from being aware of, or receiving, any information about the Foundation to protect them from any negative effects of knowing about, and entitlement to, future benefits. Typically, a disenfranchised beneficiary would lose this restriction on reaching a certain age or event.
  • The Guardian Where there is a disenfranchised beneficiary in place, the Guardian is put in place to ensure that the Council discharges its duties under the constitution to the disenfranchised beneficiaries. In summary, this is just an outline look at the key features of Foundations. For further information or to arrange a meeting to discuss our range of services, please refer to the contact details at the bottom of this newsletter.


Managing Director

Estate Planning

Is your house in order?

We specialise in the creation and administration of trust structures, keeping assets outside a person’s estate for any number of reasons. We recognise, however, that people often keep assets in their own name. In these situations you really need to ask yourself “is my estate in order?”

Where did I put my keys?

Misplacing your car keys or forgetting where you put your bank statement can be a pain but that’s nothing compared to sorting out your estate, so it is best to get your affairs in order whilst you are still able to. It will make things far easier for your family or personal representatives when the inevitable happens.

Keep records of where accounts are held, who to contact at the bank and where your shares are. It may seem straightforward to you but just think that one day someone is going to come in, probably with less knowledge of your financial affairs than you have, and will need to have a full understanding of what you have and where it is. You don’t want your family to miss out on vital funds because your offshore bank account cannot be identified.

The Financial Times has previously reported that there is a “sea of unclaimed assets sloshing around the financial system,” estimated to be worth £77 billion.

Imagine the situation. There you are walking to work one morning, minding your own business and whistling a catchy theme tune to yourself when out of nowhere, the number 7 bus takes an unexpected swerve in your direction........ The End.

Now, at some stage someone has to unravel your personal estate. Your local property and bank accounts may be in order (although, own up, how many of us have still to sort out even the local part of our estate) but what about the bank account in the Isle of Man, the investment portfolio in Jersey or the bundle of UK share certificates currently sandwiched between that Dire Straits album and the Guitar Monthly magazine at the back of the bedside cabinet?

What happens now?

You may have bank accounts, investment portfolios or shares in a separate jurisdiction to where you live. But have you considered the veritable marathon your Executor will have to run to deal with your offshore assets?

If you have a Jersey portfolio then, depending on the value, your Executor is going to need to deal with this by going through the probate process in the Island. The same needs to be done in any jurisdiction where assets are held.

We can help. Being based in Guernsey, we are ideally placed to assist Executors in obtaining probate in a number of offshore jurisdictions, such as Guernsey, Jersey, the Isle of Man and even the United Kingdom.

Losing the Will

For our South African based colleagues, both within the FirstRand Group and outside, the Executor is going to need to obtain Letters of Executorship from the Masters Office, not necessarily an easy feat in itself, but after this, probate still needs to be obtained offshore. If this is the case then we can undertake this part of the process for you.

However, sometimes it is easier and more efficient to prepare a separate Will now to deal specifically with these offshore assets. This will enable your Executor to start the process offshore whilst the same process is being carried out locally, thereby dealing with the entire estate more efficiently.

Wayne Mollet
Relationship Manager