Establishment of a Trust in CyprusA trust is an operation by which a person, known as the settlor, decides to transfer their own assets (real estate, cash, shares...) to another person, who shall manage said assets in accordance with the interests of one or more beneficiaries. Should the beneficiary be the same person as the settlor, then the trust shall be a self-declared trust.
Furthermore, it is possible to appoint a third party to supervise the trust operations.
Trust: when it is establishedThere are several purposes for which a trust may be established in Cyprus:
- asset protection;
- asset segregation;
- generational change;
- privacy protection;
Italy does not have a law on trusts but acknowledges the existence and validity of trusts established in accordance with Irish law, having it ratified The Hague Convention on the Law Applicable to Trusts and on their Recognition (The Hague, 1 July 1985).
Trusts in Cyprus: main types
Real estate investment trust (tab)Protection of one’s own real estate assets from aggressive creditors and hereditary asset-sharing tool: these are the two major purposes for which a real estate investment trust may be established. Hence, the settlor may appoint a trustee to manage their own assets, allowing them also to sell the goods, provided that any initiatives thus undertaken are in accordance with the settlor’s will.
Corporate trustBy this type of trust the settlor may confer the trustee equity investments, which shall thus be only subject to attacks of creditors belonging to the trust itself, but not those of the settlor. A corporate trust also comes in very handy during the phase of generational change within a business.
Warranty trustIn this case real estate assets, cash or other assets are conferred to the trust in order to create a completely separate set of assets to be managed in order to fulfil a certain objective. The beneficiary shall receive a warranty certificate which shall allow them to have a set of assets that cannot be attacked by their personal creditors and thus pursue the management objective set.
Family trust and trust for disabled people (tab)In this case, the conferral of assets of various kinds to the trust pursues the objective of governing situations like generational change, marriage crises, successions, relations between cohabitees...
A trust for disabled people is used, instead, for the exercise of judicial guardianship and curatorship.
For further information please call + 39 02 36 63 86 10