Trust and asset management

The trust is a legal instrument which, in the interest of one or more beneficiaries or for a specific purpose, allows to structure in various ways “legal positions” based on fiduciary ties.

The subjects of the trust or, more correctly, the “juridical positions”, are generally three: one is that of the settlor, that is the one who promotes / establishes the trust.

The second is represented by the administrator / manager. The settlor assigns assets (movable or immovable) to the administrator, who has the power-duty to manage them according to the “rules” of the trust established by the settlor. The third is that of the beneficiary, expressed or implied. Possible position is that of the guardian. “Positions” and “subjects” may not coincide. The same subject can assume more than one legal position, just as more subjects can hold the same position.

Modeling a trust capable of satisfying a specific interest means identifying the most suitable “rules” for the purpose: they are those developed / chosen by the settlor in the reference regulatory framework. Characteristic effects necessarily follow from a valid trust: separation and protection of assets, registration to the administrator, bound and responsible trust management of assets. The effects may coincide with the main / final purpose for which the trust was established.

The transfer of assets to the trust fund is bound by a bond between the settlor and the trustee, who is the so-called pact of trust; the settlor (settlor) transfers the title (not the ownership, as understood in Italian law) of those assets to be administered by the trustee in the interest of the beneficiaries and within the limits of what is established in the trust deed.

There are two elements characterizing the trust:

  • a transfer of title;
  • he administration of the assets, which must be diligent administration aimed at favoring the beneficiary

Someone defines the trust (at least the trust in its classic scheme) a sort of “frozen donation” where, among others, a donor (settlor) and a beneficiary can be identified. However, it is necessary to point out the objective difficulty of framing the trust in rigid or typical schemes or definitions precisely because of its aptitude to be declined in a myriad of mechanisms, all legitimate as long as they are within the limits of the Convention, the regulatory legislation referred to and the system legal where it is established. Trust is also used for the so-called orphan structures, a financial term that designates companies whose shares are owned by a trust with a non-haritable purpose and by no natural person, even a minority, in order to impute an asset, debt or other financial asset outside the financial statements of the corporation requesting the trust. They are used to “isolate” with a project company the assets and assets of a company from the others belonging to the same industrial or financial group, so as to make the applicant for the trust bankruptcy remote”: in the event of bankruptcy, the impact is minimal economic on the other companies of the group, which are already protected by the limitation of liability. In particular, they are relatively common tools for the creation of Special Purpose Vehicles for securitization purposes, through the issuance of Asset-backed security bonds