Corporate trust

The corporate and patrimonial trust – which in its literal translation means “trust” – is an institution of the Anglo-Saxon common law legal system, which arose within the jurisdiction of equity, whose purpose is to regulate a multiplicity of legal relationships of a patrimonial nature.

In particular, the trust is a legal relationship that arises from an inter vivos or mortis causa device act, with which the settlor (settlor) – which can be a natural person or an entity (with or without legal personality) – transfers all or part of its assets (assets) to a trustee, who has the task of administering and managing them in accordance with the provisions of the trust deed, in the interest of a beneficiary or in order to achieve a specific purpose (purpose ). In this context, sometimes there is also another person – the guardian (protector or enforcer) -, appointed by the settlor as supervisor of the work of the trustee, with the power to revoke and replace the same trustee.

In summary, the subjects of the trust or – more correctly – the “legal positions”, are the following:

  • the settlor (or settlor or grantor), that is the person who establishes the trust;
  • the administrator (trustee), who has the power-duty to manage the assets according to the “rules” of the trust, set by the settlor;
  • the beneficiary (beneficiary);
  • the guardian (protector).

Positions” and “subjects” may not coincide. In fact, the same subject can assume more than one legal position – as, for example, in the “self-declared trust”, in which a subject is both settlor and trustee –; just as more
subjects can hold the same position – as in the case of  trust  with a plurality of settlers –.

The main and inherent effect of the trust is the so-called “Segregation effect”, which determines the separation of the assets conferred from the assets of both the settlor and the trustee; from this it follows that the assets conferred cannot be the subject of executive and / or precautionary actions, by neither the particular creditors of the settlor nor the creditors of the trustee; without prejudice to the limits set out in Articles 2901 et seq. and now of art. 2929-bis of the Italian Civil Code.

In the case of a self-declared trust, its constitution does not determine – on the other hand – any transfer, but takes the form of the sole affixing of a restriction of destination on certain assets of the settlor’s assets. For this reason, jurisprudence questions its legitimacy, stating that “The self-declared trust (or sham trust), whose distinctive feature is integrated by the meeting of the settlor, the trustee and the beneficiary in the same person, goes beyond the limits of admissibility configured by art. 2 law n.364/1989. A prerequisite coessential to the nature of the trust institution is that the settlor loses the availability of what has been conferred on it, beyond certain powers that may compete with him on the basis of the constitutive rules. This condition is unavoidable to the point that, where it appears that the loss of control of the assets by the settlor is only apparent, the trust is void and does not produce the segregatory effect that is proper to it “. It should also be remembered that – with the 1985 Hague Convention, ratified without reservations by Italy with law no. 364, made enforceable and in force since January 1, 1992 – Italy has undertaken to recognize in its legal system the effects of trusts having certain characteristics, without however
any obligation to introduce internal trust regulations.