Dharshi Wijetunga, Elinor Boote and Chloe Garcia write about Economic Substance for Trust Quarterly Review
Dharshi Wijetunga, Elinor Boote and Chloe Garcia explain the potential application of economic substance laws to private trust company structures, and do economic substance rules apply to private trust company structures (PTCs)?
The article notes although the economic substance laws are not enacted under UK law, they are present in various jurisdictions that are highly relevant in the private wealth space, including the British Virgin Islands (BVI), the Cayman Islands and the Crown Dependencies, all of which are commonly used in PTC structuring.
Many advisors are aware that economic substance principles do not apply to trusts, but can economic substance principles apply to PTCs?
This article discusses several scenarios where the directors of PTCs will need to be aware of the potential application of economic substance laws to the various entities administered and owned as part of a PTC, as well as some of the more common issues arising since the enactment of economic substance laws, in the context of its application to PTCs.
The article was first published in Trust Quarterly Review (TQR), published by STEP and available to read on pages 25-30.
