TY - JOUR
AU - Goldsworth, John
AB - It is six years since the first edition of this book was reviewed in Trusts & Trustees (See Trusts & Trustees Volume 7, Issue 5, April 2001, pp. 30–33. The new edition reflects many of the changes in international trust jurisdictions. Geoffrey Shindler sets the scene in his preface. His comment that we have barely seem to have drawn breath since that first edition is reflected in the numerous new and revised chapters of the book. In every jurisdiction where trusts are practised, he says, the overriding concern is the extent that our thoughts have been dominated by regulation and anti-money laundering measures. The trust has been used as the scapegoat for the government's inability to deal with crime—internal and external. He uses succinct phrases in referring to the occasional assumption by governments that: ‘trusts must, by definition, be involved in money laundering in one form or another’. Also international quangos are not inhibited from ‘pontificating about the nefarious uses to which the trust can be put’. Such remarks reflect the stiffening of attitudes of the international trust industry to unwarranted interference. This is reflected in many of the other chapters. Geoffrey Shindler, however, is more sanguine about the greater regulation of trust providers with a warning that regulators must act sensibly in a way to ensure that enforcement of the regulation is commensurate with the risks involved. This edition follows the general format of the first with introductory articles, a jurisdiction overview of selected countries and articles on special topics. It is, however, not merely an update of previous chapters but a reappraisal of the relevant situations. Some chapters appear to be hardly altered and therefore we can be reassured that they are stable and the information still topical and relevant. An important contribution, which has hardly altered, but which is useful in view of contemporary developments, is Hein Kötz’ chapter on The Hague Convention on the Law Applicable to Trusts and Their Recognition, written from the point of view of German conflict of laws and, with examples on the interpretation of the Hague Convention according to Japanese law, brings a new look to this Convention. This is particularly relevant since current interest is in the accession of Switzerland to the Convention and the German view looks at some of the problems, which might be faced in Switzerland. Germany is unlikely to accede to the Convention. Martyn Gower has brought up to date the overview of trusts in England and Wales previously prepared by Martin Frost. In referring to government regulation, the section referring to the Financial Services Act remains and omits to note that Financial Services & Markets Act, stated to be enforced shortly, already came into force in 2001. Terry Johansson, on Australia, updates his chapter as of 1 July this year. The considerable emphasis on taxation in the chapter suggests that taxation and trusts are closely connected and that Australian trusts have been mainly used in tax planning. The types of trusts are described and their particular tax treatment. Peter Maynard updates his chapter on The Bahamas and reminds us of some of the individual features of Bahamian law and makes a comparison with UK law, as with the Variation of Trusts Act, and also some other important differences such as Section 41 of The Bahamas Trust Act, under which it is lawful for a trust deed to prevent the alienation of trust assets during the life of a beneficiary for any period. Christopher Mckenzie, who wrote the original chapter on the British Virgin Islands, is now assisted by Ayana Hull-Brathwaite, and they make some substantial amendments that take into account the 1993 Trustee Amendment Act, which makes some radical changes to the BVI's conflict of laws provisions relating to trusts. They also make mention of the important new vehicle, VISTA trusts, under the well-known Virgin Islands Special Trusts Act 2003. The chapter on Canada, very much tax-orientated, remains very much the same. Justin Appleyard's treatment of Cayman Islands follows the previous pattern, an element of which is the Cayman Island's particular view of trusts and the conflict of laws. China forms one of the new chapters. Candice Liu starts with a unique historical review of China's trust law that shows that the early form of trust business came into being in that country in 1917 when the Shanghai Commercial Savings Bank set up its safekeeping department which, four years later, was transformed and renamed as the trust department. Although other trust companies were set up, most of the business conducted by these companies was inconsistent with their names as their main business lay in the role of stock and bond brokers and agency. It was not until 1979 that China's trust business was rejuvenated. The creation of the China International Trust and Investment Company (CITIC) marked the resumption of China's trust business. The main objective of CITIC, at that time, was to provide assistance to foreign investors. This historic introduction is followed by an explanation of China's trust law. The conclusion reached by the author is that the borrowing of common law concepts and the lack of implementing rules may lead to conflicts with the traditional Chinese legal concepts. The author also comments that private trusts are still almost non-existent, although this is likely to change soon. The chapters on Gibraltar, Guernsey, Jersey, India and Israel take the form of the previous edition. Another new chapter is on Japan. It is a fascinating introduction into Japanese law with the interplay, as far as trusts are concerned, between Japan's civil and commercial codes which are independent of each other, contrary, according to Makoto Arai, to the tendency in countries such as Switzerland, Italy and Holland to combine these two codes, unlike the position in the United Kingdom and the United States where there has never been a distinction between civil and commercial codes. Trusts in Japan go back to the early part of the 20th century when many companies bore the name 'trust' although they had no connection with the legal definition of trust. Legislative reform followed. The Trust Law of 1922 and the Trust Business Law of 1922 is the origin of the modern trust system, although trusts were known before this as far back as the 16th century in connection with the proceeds from the sale of farm produce and with religious societies. The author considers that since the modernisation of Japanese trusts, now about 80 years old, it is time for revision. Any revision will have consequences beyond the country's borders because South Korea, Taiwan and China all base their trust laws on the laws of Japan. The chapter on Liechtenstein, an extensive chapter, deals with the comparison of trusts and foundations. A new chapter on Luxembourg by Eyal Grumberg take into account that Luxembourg ratified the Hague Convention in 2003. The chapter is virtually a comment on the effects of that ratification. Much of the material, formerly in a chapter on the utilisation of foreign trust structures in Luxembourg, is now omitted. New Zealand has not recognised the Hague Convention although, in Michael Reynold's new chapter recommended by the Law Commission Report on trust law in 2002 that it will be appropriate for legislation to be passed whereby the settlor's choice of governing law should be determinative. Considering the current popularity of New Zealand trusts, this chapter will be a useful addition. An account of Panama trusts, by Rubiela Samaniego, is also a new arrival, as is one on Singapore trusts by Lian Ee Teoh. The re-written chapter on Switzerland by Edgar Paltzer and Patrick Schmutz shows the importance of Switzerland's proceeding to the ratification of the Hague Convention. The chapter goes further, however, than the usual comment on this event and deals extensively with trust operations in Switzerland, many of which are dictated by the legislation on the prevention of money laundering. Barbara Hauser, co-editor of the book, deals with the United States and surveys the general principles as well as giving some useful lists of the particular rules of individual states, distinguishing between states which have adopted the uniform ‘prudent investor’ rule or those where they have abolished the perpetuity period. US asset protection trusts are covered by the previous author on this subject, Gideon Rothschild, and David Faust continues this subject with some practical guidelines on asset protection trusts. The book is concluded by a chapter by Maggie Gonzalez on the UK tax treatment of offshore trusts. Overall the book maintains a standard set by its first edition in 2000 and, with its modern updates and new chapters, should provide essential reading as a basic textbook on international trusts for all trust practitioners and advisers. © The Author (2006). Published by Oxford University Press. All rights reserved.
TI - Trusts in prime jurisdictions By Alon Kaplan and Barbara R Hauser, Eds
JF - Trusts & Trustees
DO - 10.1093/tandt/ttl034
DA - 2006-12-01
UR - https://www.deepdyve.com/lp/oxford-university-press/trusts-in-prime-jurisdictions-by-alon-kaplan-and-barbara-r-hauser-eds-kIRfplXO1g
SP - 39
EP - 41
VL - 12
IS - 10
DP - DeepDyve
ER -