- An asset protection trust is an arrangement for the holding and administration of property under which property or legal rights are vested by the owner of the property (the Settlor) in a person or persons (the Trustees).
- The Trustees then hold the property for or on behalf of other persons (the Beneficiaries).
- It is essential that the transfer is gratuitous otherwise the transaction takes on the characteristics of some other legal entity.
- A trust may therefore be defined as an equitable obligation which binds the trustees to hold and deal with the trust assets for the benefit of the beneficiaries in accordance with the terms of the trust.
- A trustee administers the asset trusts assets and distributes them to the beneficiaries in accordance with the terms of the trust deed and the proper law of the trust.
- The flexibility and protection afforded by trust arrangements are such that they have become an important part of long term wealth management.
Through the use of asset protection trusts it is often possible for family assets to be preserved over succeeding generations substantially free from:
- probate requirements,
- succession laws,
- expropriation and
- Foreign exchange controls.
There is no requirement in Mauritius to register trusts, thereby maintaining confidentiality.
A corporate structure allows its shareholders to have business conducted, own assets and limit liability. The ability to manage assets through a combination of trusts and companies is proving increasingly valuable and the legislation in force in Mauritius provides an effective framework for the conduct of international fiduciary activities and providing services in that respect.