In 2018, the Federal Council was instructed to provide the legal basis for a Swiss Trust to strengthen the Swiss Financial Center. Now, the Federal Council has opened the consultation on the preliminary draft of the Swiss trust law.
The legal institution "trust" has gained more and more importance in practice. Today, it is practically impossible to imagine international wealth structuring and estate planning without the trust. While other countries have known their own trust law for some time, there is still no Swiss trust. For wealth management by means of a trust, Swiss residents have therefore had to resort to trusts under foreign law, which have been recognized in Switzerland since the Hague Trust Convention came into force. In 2018, the Federal Council was instructed by Parliament to provide the legal basis for a Swiss trust, whereupon the Federal Council has now proposed the introduction of a trust law into the Swiss Code of Obligations.
The introduction of a Swiss trust is intended to meet the need in practice for a new Swiss instrument for wealth structuring and estate planning. It is also intended to strengthen Switzerland as a financial center and business location again. A Swiss trust would offer new application and business opportunities in wealth structuring and thus also allow the closing of a gap in the legal system with a Swiss rather than a foreign instrument.
As an instrument of wealth management, the trust basically offers great flexibility. In principle, only various mandatory legal provisions, such as the right to a compulsory portion under inheritance law, remain reserved. Especially in the estate planning of entrepreneurial and wealthy families, the trust can be used purposefully to secure and transfer assets over several generations. But a trust can also be used in other areas of business life to preserve, manage or secure assets.
A trust is similar to a foundation insofar as certain assets are also segregated for the benefit of beneficiaries. However, the settlor transfers the assets to a natural person, the trustee, and not to the trust itself, which, different from a foundation, does not have its own legal personality. The transferred assets form a special property and are not part of the other assets of the trustee. After all, the trustee is obliged to manage and use the assets from then on for the benefit of certain beneficiaries. It is possible to set up a trust during lifetime or at death for a maximum of 100 years.
Various international requirements are also to be integrated into Swiss trust law. Therefore, among other things, special information and documentation obligations are envisaged for the trustees. These include, in particular, the identification of the beneficial owners of the trust assets. Other duties of care for trustees are also intended to prevent trusts from being used inappropriately.
On 12 January 2022, the Federal Council opened the consultation on the preliminary draft of the Swiss trust law. This will now run until 30 April 2022, after which it will be discussed in parliament.