The Foundations (Jersey) Law 200
Jersey is the first of the British Crown Dependencies to enact legislation permitting the establishment of foundations. The Foundations (Jersey) Law 200 - (the 'Foundations law') was passed by the States of Jersey on 22 October 2008 and is expected to become law there in the first half of 2009.
Foundations are rooted in Roman law, which has meant that they are more familiar to inhabitants of civil law jurisdictions than those of common law jurisdictions.
Liechtenstein was the first jurisdiction to introduce the modern foundation (in 1926) and has built a whole economy on the principle. Other jurisdictions, such as Panama and the Bahamas, have enacted their own legislation for the same reasons. There has been pressure to introduce foundations in Jersey for several years - not as a replacement for trusts, which are well established in the island - but as a new vehicle for wealth management, particularly for those for whom the trust is an unfamiliar concept, where transparency is necessary or where a degree of control which is not permitted with trusts is required.
The foundation is neither trust nor company, but a brand new concept for Jersey. Many civil law jurisdictions do not recognise the concept of a trust but are happy with the foundation. It is expected that foundations will be used by those who require transparency, wish to control assets, or who prefer a structure with which they - and their advisers or the authorities in their home jurisdiction - are familiar. It is hoped that this new product will keep Jersey at the leading edge in the provision of international financial services.
This article is abbreviated from the work of Carolyn Cowan, Senior Associate, Ozannes Jersey. The full version can be found in Ozannes' newsletter 03/09
Email Carolyn.firstname.lastname@example.org or telephone (+44) 1534 723466