The regulation of trust companies and other financial services providers in Jersey is governed by the Financial Services (Jersey) Law 1998 (the "Financial Services Law"). The general rule is that no person may carry on financial services business (which for the purposes of the Financial Services Law includes investment business, trust company business and general insurance mediation business) in or from within Jersey, and no person being a company incorporated in Jersey may carry on such business in any part of the world, unless the person is for the time being a registered person under the Financial Services Law, and acting in accordance with the terms of his or her registration.

A person carries on trust company business for the purposes of the Financial Services Law if that person carries on a business that involves the provision of company administration services or trustee or fiduciary services and in the course of providing those services the person provides any of the following services:

  • acting as a company or partnership formation agent;

  • acting as or fulfilling the function of or arranging for another person to act as or fulfil the function of director or alternate director of a company;

  • acting as or fulfilling the function of or arranging for another person to act as or fulfil the function of a partner of a partnership;

  • acting or arranging for another person to act as secretary, alternate, assistant or deputy secretary of a company;

  • providing a registered office or business address for a company or partnership;

  • providing an accommodation, correspondence or administrative address for a company, a partnership or for any other person;

  • acting as or fulfilling or arranging for another person to act as or fulfil the function of trustee of an express trust;

  • acting as or fulfilling or arranging for another person to act as shareholder or unitholder as a nominee for another person.


A number of exemptions from this general rule, both limited and unlimited, are contained in the Financial Services (Trust Company Business (Exemptions)) (Jersey) Order 2000. In particular, a company is permitted to operate as a private trust company without being obliged to apply to the Jersey Financial Services Commission (the "Commission") to be registered under the Financial Services Law.

The private trust company business exemption applies where a company (the "PTC") meets the following criteria:

  • the purpose of the PTC is solely to provide trust company business services in respect of a specific trust or trusts;

  • the PTC does not solicit from or provide trust company business services to the public; and

  • the administration of the PTC is carried out by a registered person registered to carry out trust company business.

Accordingly, in order to avoid the obligation to register, the activities of the PTC must be limited to acting as the trustee of a single trust or a series of related trusts (usually with a common settlor or relating to a particular family). Coupled with this, the PTC must be truly "private" inasmuch as it does not offer trustee services to the general public. There is no need for the PTC's memorandum to state that it will operate as a corporate trustee or that any particular wording appear in the PTC's articles of association.

The administration of the PTC must be carried out by a service provider in Jersey which is itself a registered person under the Financial Services Law and the Commission will look to the service provider to ensure that the terms of the private trust company business exemption are met in each case. The legislation offers no practical guidance as to what constitutes administration in these circumstances. Whilst there is no legal requirement that the service provider supply directors of the PTC, typically, it will be represented on the board along with the settlor, members of his family and his trusted advisers (or a combination thereof).

The private trust company business exemption is available both to Jersey and non-Jersey incorporated companies. There is no requirement that the Commission formally approve the availability of the exemption or that the documents relating to the underlying trust or trusts be submitted to the Commission for scrutiny. Provided the three criteria above are met, the only formality will be to notify the Commission of the name of the PTC.


Although the PTC will not be required to register under the Financial Services Law, it should be noted that the private trust company business exemption is limited; certain provisions of the Financial Services Law will still apply to the PTC as if it were a registered person with the result that it remains subject to the overall supervision of the Commission.


Prior to 27 October 2006, Article 56 of the Trusts (Jersey) Law 1984 (the "Trusts Law") provided that where a corporate trustee committed a breach of trust, every director of that trust company at the time the breach occurred was deemed to be a guarantor of the trust company in respect of damages and costs awarded against the trust company. This corporate guarantee, first introduced in the early 1980s, was considered by many to have become redundant in the light of the regulatory framework of the Financial Services Law with the introduction of minimum requirements for trust company businesses in terms of financial resources and professional indemnity insurance. It was also perceived to be a major deterrent to a prospective settlor wishing to establish (and sit on the board of) a PTC in Jersey.

With the repeal of Article 56 by the Trusts (Amendment No. 4) (Jersey) Law 2006, this potential obstacle to the establishment of a PTC has been removed.


Deciding who owns the shares of the PTC will depend largely on the personal circumstances of the settlor and, clearly, appropriate tax and/or other advice will need to be sought on this in the settlor's own jurisdiction.

One option might be for the settlor to hold the shares personally, although this is rarely a satisfactory solution for tax and succession planning reasons. Whilst perhaps a more costly alternative, it is usually preferable for the shares to be held in a Jersey trust; either a charitable or non-charitable purpose trust would be appropriate for this. Typically, the regulated service provider providing administration services to the PTC would also as trustee of this trust. In the case of a non-charitable purpose trust, the Trusts Law requires that an enforcer be appointed, independent of the trustee, whose duty it is to enforce the execution of the trust. A member of the settlor's family or an advisor is often appropriate to take on this role.


Jersey's "light touch" approach to the regulation of PTCs means that a PTC may be incorporated quickly and without the burdensome and costly licensing procedures which currently exist in certain other jurisdictions.


Peter Harris, Partner

David Pytches, Associate

Cayman Islands

Grant Stein, Partner

Andrew Miller, Partner


David Whittome, Partner

British Virgin Islands

Christopher McKenzie, Partner

Hong Kong

Carol Hall, Partner


Rod Palmer, Partner

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.