Structures for Private Wealth Management
Almaty, Kazakhstan
Presented by Simon Mackenzie
Partner – Ogier Group
Group Director - Ogier Fiduciary Services
May 2011
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Contents
1.
2.
3.
4.
5.
Introduction to trusts
Foundations
Companies
Case study and example structure
Administration issues
• Control
• Due diligence / “KYC”
• Confidentiality
• Incorporation
• Ongoing administration
• Liquidation
6. Features and benefits of international jurisdictions
7. How can Ogier help?
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Trusts - introduction to the trust concept
A trust is a legally binding arrangement whereby a person (known as a settlor) transfers assets
to another person (known as a trustee) who is entrusted with legal title to the trust assets, not
for his own benefit, but for the benefit of other persons (known as beneficiaries, who may
include the settlor or for a specified purpose).
The components of a trust:
• Settlor
• Trustee
• Beneficiaries
• Trust fund
• Protector (optional)
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Trusts - structure
Protector
(optional)
Letter of Wishes
Settlor
Trustee
Beneficiaries
Company
Trust Fund
Company
Settled assets
Company
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Uses of trusts
Trusts can be established for many reasons, be it business continuity, personal succession,
asset protection, tax efficiency, family governance or confidentiality. Potential benefits include:
• Provide for dependants - distributions can be made to children at predetermined ages, or
for specific purposes such as funding education
• Business continuity and preservation of family wealth - pass on wealth intact through
generations
• Protection of assets against future claims against the owner
• Estate planning - avoid costs, delay, legal problems, publicity and unwanted procedures on
death
• Avoidance of forced heirship
• Tax planning
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Foundations - introduction to the foundation concept
• Foundations are vehicles for holding assets.
• A foundation is traditionally viewed as being somewhere between a trust and a company
• A foundation must usually be established with one or more ‘objects’. Objects can be
charitable, non-charitable or a mixture of both
• Permissible objects might include, for example, benefiting a particular person or class of
persons or carrying out a specific purpose or holding a particular asset
• “Ownerless” incorporated vehicle with separate legal personality
• A foundation’s powers will be exercised by its council (similar to a company’s board of
directors)
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Foundations – structure
Advisors
(optional)
Founder
Guardian
(optional)
Foundation Council
Objects
Company
Foundation
(charter and regulations)
Company
Registered office
Company
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Uses of Foundations
Common reasons for the establishment of a Foundation include:
• Business planning
• Holding assets to benefit family members.
• Succession planning to enable family assets such as businesses to benefit the next
generation without the need to physically divide that asset.
• Carrying out charitable or philanthropic purposes.
• Retaining and preserving specific assets.
• Holding an asset such as a company to carry out a specific transaction.
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Companies
A company is an incorporated body with separate legal personality formed for the purpose of
business or a special purpose
Uses of international companies:
• Holding vehicles
• Segregation of assets
• Funding and financing
• Listing vehicles
• etc
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Company structure
Shareholders
Business
Board of Directors
Advisors
Memorandum of Association
Articles of Association
Registered office
Business
Business
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Case Study
Kazakh Individual
Key considerations:
100% owns
Kazakh
Holding Co.
• Income for owner and family members
• Succession planning for the business
• Asset protection
Subsidiary
Subsidiary
• Estate planning
Businesses in Kazakhstan
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Example Structure
Trust
International
Holding Co.
Holding Company
(Double Tax Treaty Jurisdiction)
International Holding Companies
(Assets outside Kazakhstan)
Kazakh
Holding Co.
Kazakh
Holding Co.
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Business Assets in Kazakhstan
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Administration - issues of control
• Governance
• Potential tax liability
• Methods of retaining influence
• Trusts
• Foundations
• Companies
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Administration – due diligence / “KYC”
• Why is it required?
• Documents / information required
• Who is it provided to?
• Confidentiality
• In what circumstances could it be released?
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Administration – incorporation
• Incorporation
• Memorandum and Articles of Association
• Subscribers
• Beneficial Ownership
• Corporate Purposes
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Administration – ongoing issues
• Directors
• Company secretary
• Registered office
• Accounting
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Administration – liquidation
• Liquidation plan
• Declaration of solvency
• Filings at the registry
• Effect of appointment of liquidator
• Certificate of dissolution
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Features and benefits of international jurisdictions
• Tax neutrality
• Stable jurisdictions – politically and economically – internationally recognised by banks,
multi-nationals, stock exchanges etc
• Flexible and robust regulatory regimes and effective court systems
• Confidentiality
• Flexible corporate legislation
• Exit strategies
• Internationally compliant – AML, regulation, tax – OECD/IMF/FATF/EU
• Professional expertise
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How can Ogier help?
•
Integrated legal and administration expertise – “one-stop shop”
•
Bespoke services tailored to individual client requirements
•
Access to highly qualified and motivated staff
•
Responsive and consistent client service – “can do” attitude
•
Transparency / flexibility regarding fee charging arrangements
•
Access to multi-jurisdictional expertise through one group
•
Geographic / time-zone locations
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Our Global reach
Over 800 staff, 52 partners, 190+ lawyers and 285 professional administrators across nine jurisdictions
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Thank you
Presented by
Simon Mackenzie
Partner – Ogier Group
Group Director, Ogier Fiduciary Services
Tel: +44 1534 504392
Fax: +44 1534 504444
[email protected]
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