‘Ahead of its time’ fiduciary law under review

Russell Clark, pictured, who heads the trust and private wealth practice at Carey Olsen, said the Guernsey Trusts Law remains a reminder of the island’s ability to innovate and adapt to changing market conditions – a decade on since it came into full effect.

‘Since its inception in 1989, the Guernsey Trusts Law has been extremely welcome and robust legislation that has helped to underpin the development of the fiduciary industry in Guernsey,’ said Advocate Clark.

The Trusts (Guernsey) Law, 2007 replaced the Trusts (Guernsey) Law, 1989, and was designed to create a more flexible framework for the local trust industry and to provide better protection for both settlors and trustees.

‘We have continued to improve it and tweak it over time and are now seeing many of the changes introduced in 2008 being copied elsewhere. For example, Jersey is now looking to introduce an “on-possessory lien” along the same lines of that which we introduced in the 2007 revision.’

The legislation is now being reviewed. Carey Olsen is a member of a new working party tasked with the job, as it was when the 2007 law itself was introduced.

‘It is reassuring that our innovations of a decade ago are being adopted elsewhere, but we must continue to keep the legislation under review.

‘We need to ensure that it remains fit for purpose and that it maintains a balance between the desires of settlors on the one hand and the rights of beneficiaries on the other,’ added Advocate Clark.