[ESTABLISHING A BUSINESS ENTITY IN LIECHTENSTEIN]
304
benefiting specific individuals or institutions. Within the framework of the administration of the assigned assets, the trust may at any time acquire stakes in companies and exercise holding functions. As in the case of the foundation, the trust can be used to secure assets over the long term and to settle the estate of the settlor. The assets are not held by a legal entity. Instead, a contractual relationship is established with the trustee. However, the assets assigned to the trustee no longer form part of the assets of the settlor. The settlor can designate himself as the beneficiary during his lifetime and can designate how the assets are to be used after his death. Protected Cell Company The concept of a Protected Cell Company is a relatively new addition to Liechtenstein law. A Protected Cell Company is not a separate legal entity, but rather allows other entities to be split into different segments. Therefore, it allows for additional structuring possibilities under Liechtenstein law. Possible uses include the allocation of specific assets or benefits to a specific segmented cell of an entity. Steps and time to establish As a general rule, an entity will be formed in Liechtenstein by a licensed fiduciary. The fiduciary forms an entity in a fiduciary capacity in its own name, but on behalf of the client. The formation of an entity usually does not take more than one week. Legal entities are formed by way of an incorporation deed and articles of association which must be filed with the Commercial register. The types of companies outlined above may be formed by one individual or legal entity. The sole
exception in this regard is the Company Limited by Shares whose formation requires two founders. Commercial Registry fees are normally circa CHF 1,000.00 but will be higher if the share capital exceeds CHF 50,000.00. The Company Limited by Shares, Limited Liability Company, the Trust Enterprise, and the Foundation subject to a duty to register, do not acquire legal personality until they have been entered onto the Commercial Register. The deposited Foundation and Trust Settlement come into existence as early as upon the signature of the formation documents.
Governance/Regulation Highest governing body
All legal persons and the Trust Enterprise have a supreme governing body (the members meeting, the holder of founder’s rights or another body) vested with the supreme powers, which include, for example, approving the annual accounts, passing resolutions on profit appropriation, appointing the other governing bodies, amending the articles of association, increases in share capital etc. As far as foundations are concerned, these powers are generally vested in the foundation council. Management Organ The management organ is the executive governing body of the entity. All legal persons must have an administrative council (board of directors, foundation council or manager) which, unless provided for otherwise, may consist of one or more individuals or legal entities or firms and is generally appointed by the highest controlling organ. Requirement for local directors/shareholders It is generally required that at least one member of the administrative body be the
ILN Corporate Group – Establishing a Business Entity Series
Made with FlippingBook Ebook Creator