Swiss Advisors 1973
To date, there is no domestic Swiss law on trusts and therefore one must always refer to the international framework However, on 12.1.2022, the Federal Council launched an advance project which will end on 30 April with the presumable introduction of the Trust Law into the Swiss Code of Obligations.
The activity of Trustee is already regulated in Switzerland by the LisFI (Law on Financial Institutions), which came into force on January 1, 2020, from which it is clear that professional Trustees are subject to license and operate under the supervision of FINMA (Financial Markets Supervisory Authority).
Professional Trustees must have adequate capital assets, adequate internal control systems and risk management, and must have qualified managers to manage the trusts. The Trustee in Switzerland must also comply with the due diligence requirements of the Money Laundering Act (MLA) under the supervision of FINMA. These provisions are in accordance with European regulations and FATF recommendations.
Link: Swiss Trustees must also comply with international tax transparency regulations regarding the automatic exchange of information.
But why set up a Trust in Switzerland?
There may be several reasons for this. Switzerland is a globally recognized financial center where settlors can have their trust assets managed with complete peace of mind.
The solidity of the country's system guarantees stability and security over time where legal certainty is recognized. The activity of professional trustee in Switzerland is a supervised activity (as it is not in other European countries).
The Swiss trustee is considered to be a financial intermediary and this aspect is of certain importance and guarantee for the beneficiaries, given that the trustee is subject to specific rules relating to the exercise of the activity, internal organization, as well as requirements of honorability and professional competence of the persons who are part of the staff and deal with the administration of the trusts.
The taxation of the trust and the trustee are also a factor that may favor residence of the trustee (and the trust) in Switzerland over other jurisdictions.
