What is a trust fund for private use
The legal term and institute of trust funds (Svěřenské fondy), so-called trusts, is a novelty in the Czech legal system in contrast to the countries of common law, which the Act No. 89/2012 Coll. Of the Civil Code, as amended (in Furthermore only "BGB"), which has been effective since 1.1.2014, in its part contained in the provisions § 1448 to 1474 BGB.
The trust fund (Czech. Svěřenský fond) is according to the legal definition contained in the provision § 1448 BGB, an independent outsourcing of the property, which is completely separated from the property of the founder by the fact that the founder is a specific person with the management of this Wise outsourced assets by means of a contract or a disposition upon death - an analogy of the Will mandated, with the mandated trustee undertaking to borrow, hold and manage such assets in accordance with the instructions of the founder. The trust fund is not a legal entity.
With the establishment of a trust fund (Czech Svěřenský fond) a complete separate, independent Ownership of the spun off assets managed by the trustee who does this on behalf of the founder who remains completely anonymous. The trustee exercises ownership of the property in his own name for the account of the fund.
It is worth noting that these assets in the trust fund (Svěřenský fond) are neither owned by the administrator nor the founder, nor are they owned by the person - the beneficiary, to whom the trust fund is to be paid.
With regard to the above, a simplified version of the definition of the trust fund (Svěřenský fond) is available in the following version: A trust is an asset that the owner voluntarily separates from his sphere of property and disposal and a specific person with his Holding and managing for the specific purpose and for the benefit of the persons defined by the owner. One can reasonably suspect that this trust fund institute is something very extraordinary, since the anonymity of its ownership background gives the founder a wide range of options for using the assets segregated in this way and determining the types of disposal over him.
The reason a trust fund is created can be both charitable and private, the main difference being the fact that the purpose of a charitable fund cannot be for profit.
If it is a fund that has been set up privately, this fund will be used for the benefit of the person appointed by the founder - of the beneficiary, or in the case of a deceased person as an appreciation of their memory or to secure the future of the children, wife or any other person. Another purpose of the private character can also be the implementation of an investment project of the founder, such as B .: Investments on the stock exchange with securities by the trustee or purchase of bonds or the division of the assets in the fund between the employees and partners of the founder.
The law introduces mandatory fund designation, whereby the designation must always express the purpose of the trust fund and, among other things, contain the exact words “trust fund” (Svěřenský fond). The subsequent fund creation is bound to the agreement of the trustee with the fund management and administration. If the fund is set up for death, the trust fund is created when the deceased dies.
The trustee can be any legally competent person, possibly also a legal person. The trustee can also be the founder or the beneficiary, but a further trustee must be appointed together with him, who will participate with him in the fund administration. The trustee has full control over the management of the assets in the trust fund (Svěřenský fond), provided that it is necessary to keep the assets in a public register or in other records (e.g. public property register, commercial and patent register) record, the trustee is listed as the owner of the thing with the comment "trustee", which is another legal condition for compliance with the anonymity and independence of the entrusted assets.
Another condition for the creation of a trust fund is the existence of a statute issued by the founder, the legal system in § 1452 BGB lists the points that the statute should contain:
a) Name of the trust fund
b) Designation of the assets that the trust fund constitutes when it comes into being
c) Definition of the purpose of the trust fund
d) Conditions for the achievement of the Trust Fund's purpose
e) Information on the duration of the purpose of the trust fund, if it is not stated, this means that this fund was established for an indefinite period
f) If payment is to be made to a person as a beneficiary, the determination of this person or the manner in which the beneficiary is determined, otherwise the trustee will select the beneficiary.
One of the most common reasons why the founder decides to set up a trust fund is the founder's desire to grant the beneficiary the fruits and proceeds of the trust fund or the right to an asset from the trust fund or a share in it. The founder names the beneficiary, or he names the group of people from which the trustee selects the beneficiary, from the appointment of the beneficiary for a receipt from the trust fund (Svěřenský fond) of a certain service, everything depends on the statute and Procedure established by the legal system. The beneficiary has the right to request the performance from the trust fund only during the term of the trust fund.
A common reason for setting up a trust fund is also the will to provide for the children for the future, whereby the founder benefits from the trust fund performance from the fulfillment of certain conditions, such as e.g. B. university degree or the care of the founder, makes dependent, or the granting of material security to an illegitimate child without the rest of the family knowing about it.
In conclusion, it is essential to note that in the case of trust funds (trusts) as a legal institution that has been tried and tested abroad and is very popular, it is a completely extraordinary legal instrument that allows the founders a completely free and discreet choice of how to deal with their assets even without the knowledge of their relatives, customers or partners.
• JUDr. Spáčil, BGB III. Property rights (§ 976-1474), Verlag Beck 1 edition, 2013, pages 1186-1192
• Prof. Dr. JUDr. Eliáš und Kollektiv - The New Civil Code with updated justification report and register, Verlag Sagit 2012
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