The private foundation is an efficient instrument for Individuals and Family Offices to structure, protect and transfer their wealth to the next generation.

Individuals and wealthy families may use

The Private Foundation for

numerous reasons, including:

The cohesion of the family patrimony

The Foundation can be used as an instrument to prevent the dispersal of assets in the event of death of a member of the family. The Foundation becomes an instrument of succession planning to ensure the continuity of a patrimony or even a family business, and to maintain or enhance the long-term family wealth.

The continuity in the management of the company

the Foundation allows the separation of economic ownership of family property and the management of the family business. This is particularly useful when the founder has no children, if he considers that some of the heirs are not suitable or when they do not want to run the family business, but also to allow a family business to move towards a more open structure to attract new capital and talent.

The holding of assets

The Private Foundation may hold any type of assets and possessions (financial, real estate, insurance policy, movable, arts, etc.) around the globe, while retaining an overview of the decision.

The achievement of a given purpose with the family

the family patrimony can be assigned to a specific purpose such as to ensure that financial needs of a child or disabled parent or the funding of education of a child.

The preservation of the original vision of the founder

The Wealth Protection Plan, developed by Creatrust, is a package enabling families to set up a secure, robust plan for retirement and succession.

The protection of privacy and family safety

The Private Foundation can meet the legitimate needs of wealthy families to limit the visibility of their assets to ensure their safety and the safety of their children.

In recent years, Luxembourg has made considerable efforts to develop its financial market with a range of legal instruments which seek to respond to the legitimate needs of both private clients and professionals active in the financial sector of asset management. For the purpose of strengthening the position of the Luxembourg financial center as a center of excellence in Europe for the management and administration of family wealth, it is proposed to complete this range of instruments with a new vehicle to facilitate estate and succession structuring and planning.

As a result of this, the Luxembourg government issued a draft law on Foundation dated 22 july 2013, which introduces an orphan structure called the “Luxembourg Private Foundation”, as an addition to company and contractual solutions (e.g. fiduciary contracts, insurance contracts) commonly used in estate and succession structuring and planning. But these provisions have not come into effect since the bill has yet to be voted.

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