Investment Fund in Liechtenstein
INVESTMENT FUND IN LIECHTENSTEIN
The Principality of Liechtenstein offers funds of interest to businessmen with specific variations called “Stiftung”. They are a kind of hybrid between a company whose liability is limited to safeguards and trust. The main purpose of their creation is to preserve, increase and disposition all available property. Affiliates are available initially, the goal setting is rather narrow and concrete, and it excludes commercial orientation. The Liechtenstein funds allow for private transfer of funds between generations, to perform a donation, as they will act as property that is not a private person but a certain structure.
OBJECTIVES AND PROCEDURE OF REGISTRATION
Liechtenstein Stiftung, in process of acquiring legal personality, conducts the separation of assets, both from the juridical person and from the founders. Its basic purpose is to realize the intentions that the founders profess. This is done by a body that provides management and the participation of its members. Recognition is subject exclusively to beneficiaries, the role of which can be the founder.
Considering main goals of Stiftung, it is worth first allocate such of them:
- Work with assets, including family members belonging to the transfer of ownership, education fees and other;
- The public – level focus on artistic, scientific, cultural and social;
- Charitable activities, support of religious activities;
- Transfer of funds for existence and their accumulation.
Commercial use of funds is also permitted, provided that the objectives achieved are non-economic in purpose. A mixed variant of benefits is possible – family or for other beneficiaries.
The registration procedure is standard, takes 3 working days, and its cost is 3500 Swiss francs. The procedure itself includes:
- Name checking;
- Payment of stamp duty;
- Preparation and transfer of the agencies package of the required documentation;
- Capital tax payment;
- Hiring a local agent or a representative;
- Opening of the account in the bank, preparation of printing.
EXISTENCE OF FUND AND DISTINCTIVE FEATURES OF THIS FORM
The creation of investment structures is available to any person. In this case, legal or physical, it has no value, as there are no restrictions of territorial or civil character. To achieve legal personality it is necessary to make certain data in the structure of unambiguously, although many types do not need even this. Provided that the public has access to the constituent documents, the foundation is assigned the definition “having registration”, in the absence of “escrow”. The latter category includes family members, including mixed structures, church-religious structures, and units with a specific beneficiary definition.
When studying main features that are similar to Stiftung, one should note such of them:
- Capital requirements. The lowest amount required in the initial phase is 30000 Swiss francs, which should be transferred to the Liechtenstein Banking institution before the fund is opened. Upon completion of the procedure, the receipt of funds to the account is also possible from other persons or founders;
- Goal setting. The principality is characterized by rather flexible and simple rules of their defining. The main thing is that the goals are not immoral and have no contradictions with the law. Often, they are fixed at the moment of rendering assistance, in covering expenses, at the stage of support of talents, carrying out of activity on scientific and cultural direction, in the process of reception of religious education or upbringing, Life support in general;
Name. Approval of it takes place in register, and it is necessary to ascertain in advance that it does not have names of countries or wide known titles of transnational scale. If the name has a reference to a particular activity, its confirmation is possible only on the basis of the relevant license;
- Information and their confidentiality. Formed in the role of deposit funds, have documentation, access to which by external stakeholders is absent. Within the framework of the judicial register of funds in the territory of the Principality is kept only basic information (Instrument of Foundation), other data are under reliable protection;
- Responsibility. Debt repayments are carried out by means of raising funds, and it is suggested that the beneficiary may not be deprived of its benefit at the insistence of creditors;
- Stock funds. There is a separation from capital, with the formulation of the total amount for all available assets with the control carried out by the founders. It is also possible to commit exclusive rights, total control or the purpose of the protector in the event of death of the founder;
- Completion of activities. Provided that the foundation documents do not stipulate otherwise, the fund exists in noncancelable form. It is permissible to formulate clear reasons for dissolution, terms of the process and its legal procedure. If it is impossible to reach the range of the set goals, the Fund shall be cancelled.
BENEFICIARIES AND ADMINISTRATIVE BODY
In process of registration the document describes the purposes of the formed structure and duration of its functioning, with indication of beneficiaries and the managing body which will supervise its work. The beneficiaries are often shown in the form of additional annexes, which are combined with the constituent registers. In establishing the Council, the body responsible for management, it is quite possible to do without their promulgation. The status of members, as well as their number, is not stipulated, which makes it possible to appoint corporate units, the spouse of the founder, foreign citizens who do not have princely domicile. But there is a restriction-a minimum of one of the members of the Fund, is obliged to have Liechtenstein citizenship.
The following requirements apply:
- Obligatory licensing in the role of trustee, lawyer, auditor or agent;
- Possession of the qualification, which is confirmed in the territory of the Principality; • Accommodation within the country.
The rights of the Foundation board include administration, instruction and presentation, with each aspect being separately specified within the framework of the constituent documents used. The powers are allocated by founders; it is possible to create additional bodies whose activities are aimed at specific purposes, as well as advisory boards. In the case of commercial activity, the presence of the auditor’s Fund in the staff is obligatory.
The “framework” under the interests of beneficiaries and themselves are formed based on constituent norms. The law does not provide for restrictions on their structuring. The founder has the right to identify himself as a beneficiary, to ensure his own continuity or to protect assets that requires them to move beyond the expectant property rights (this may be, for example, transfer of real estate to nearest relatives).
State supervision and peculiarities of taxation
The government controls all funds except for family distributing profits (administrative), religious and special beneficiaries. The structure is obliged to have a legal representative, which will also be used as a legal address. In addition to mandatory reporting, which is carried out annually, including data on the status of assets, there is a tax on capital, the amount of which is 0.1% and it varies based on the size. The minimum rate is 1000 Swiss francs. Payment of fees on property, income and growth of assets is not provided. In case the founder resides outside the state, the transfer of finances is not subject to taxation on inheritance and donation. There is an additional tax revenue and Stump, the rate of which is 0.2 percentage points, and it is applied in respect of nominal capital. The minimum payout is CHF 200.