Jersey: Foundations: Popular Addition To Structuring Opportunities In Jersey

Last Updated: 30 September 2014
Article by Zillah Howard


The Jersey foundation was introduced in 2009 as a new form of incorporated vehicle. From the beginning, three broad categories of use for the Jersey foundation —for succession planning, as orphan structures for specified purposes and for philanthropy —have been clearly identified and continue to grow and develop, utilising the flexibility offered by the Foundations (Jersey) Law 2009 (the `Law'). Before looking at these, it is, perhaps, helpful to highlight some of the key features of the Jersey foundation and to outline the principal components of its structure, recognising that it is not an exact equivalent or copy of a foundation established in any other jurisdiction.

Key Features

Some of the key features of the Jersey foundation are as follows:

  • Incorporated vehicle: A foundation is an incorporated vehicle brought into existence following the completion of a registration process.
  • Legal personality: A foundation is a separate legal entity that holds assets and enters into contracts in its own name.
  • Public record: A foundation's existence can be determined as a matter of public record by conducting a search of the register of foundations. The entry of a foundation's name in the register is conclusive evidence that the foundation has been incorporated and that the requirements of the Law in that regard have been complied with.
  • No ultra wires: The doctrine of ultra wires does not apply, and a foundation can exercise all the functions of a body corporate, save only that it cannot directly (a) acquire, hold, or dispose of immovable property in Jersey or (b) engage in commercial trading that is not incidental to the attainment of its objects. However, both of these restrictions can be overcome by interposing an underlying company so that the relevant activity is not undertaken directly by the foundation.
  • Orphan vehicle: A foundation does not have shareholders or any other form of owner.
  • Indefinite existence: Foundations can continue to exist for an indefinite period.


The principal components of a foundation's structure are outlined as follows:

  • Founder: The founder is the person upon whose instructions a foundation is incorporated. A founder need not endow assets upon the foundation: it can come into existence without assets.
  • Constitutional documents: A foundation's constitutional documents are its charter (which is registered and open to public inspection) and its regulations (which are not registered and, therefore, private).
  • Objects: A foundation's objects can be charitable or non-charitable (or a combination of both) and can be to benefit a person or class of persons, carry out a specified purpose, or to do both.
  • Council: A foundation has a council, which is similar to a company's board of directors. The council's function is to administer the foundation's assets and to carry out its objects. The council can have one or more members, with one member being a `qualified person' with an appropriate regulatory licence: this member is known as the qualified member. Council members are required to act honestly and in good faith with a view to the foundation's best interests and to exercise the care, diligence, and skill that reasonably prudent persons would exercise in comparable circumstances.
  • Guardian: Every foundation has a guardian whose role is to take such steps as are reasonable in all the circumstances to ensure that the council carries out its functions. The founder and the qualified member (but not others) may fulfil a dual role as both council member and guardian.

What are foundations being used for?

In view of the Law's flexibility, foundations are being used for a wide variety of reasons, and three broad categories of use stand out.

Succession and estate planning

Significant numbers of clients are incorporating foundations for succession and estate planning, and, in addition to inherent preference of a foundation over a trust on the part of some clients, there are several features of the Jersey foundation that can be important in influencing this choice.

  • Disclosure of information: Save to the event expressly required by the Law or by its constitutional documents, a foundation is not required to provide beneficiaries (or others) with information about the foundation. In relation to express statutory requirements, the Law provides for copies of the regulations to be supplied to those appointed under the regulations (namely council members, the guardian, and anyone else appointed under the regulations to carry out a function in relation to the foundation). This feature of the Law can be very important, as it allows for a tailored and individual approach to be taken in relation to the topic of disclosure. For some, it may be desirable that there should be no disclosure, whilst, for others, it may be considered that beneficiaries should be given information —but not until a predetermined age or in predefined circumstances. The ability to make such decisions can often be very helpful — particularly, for example, where younger family members are concerned, and efforts are being made to encourage them to develop their own careers and independence.
  • Fiduciary duties: Another feature that can be important is that, where a foundation's objects are to benefit a person or class of persons (either exclusively or in conjunction with the carrying out of a purpose), the beneficiaries have no interest in the foundation's assets and are not owed a duty (by the foundation, council, guardian, or anyone else appointed under the regulations to carry out a function in relation to the foundation) that is or is analogous to, a fiduciary duty. However, where a beneficiary becomes entitled to a benefit pursuant to the foundation's constitutional documents and that benefit is not provided, the beneficiary can apply to the courts in Jersey for an order that the foundation should provide the benefit.
  • Separate existence: For some clients, it is important that assets will beheld in the name of the newly created foundation and will continue to be held in that name throughout the foundation's existence.
  • Nature of assets: In some cases, the nature of the assets to be held will influence the choice of structure. A foundation can be established with the express object of holding specified assets, and this (coupled with the absence of fiduciary duties being owed to beneficiaries) can make it an attractive choice where, for example, wasting assets (such as boats or aeroplanes) or `family silver' assets (such as shares in a family business) are concerned. The use of a foundation to hold such assets can be helpful to manage or avoid some of the tensions that can arise between different groups of family members, with some being keen for a particular asset to be retained whilst others would prefer it to be sold in -order to maximise investment returns.
  • Family governance: A foundation's regulations, whilst required to contain certain information, can also incorporate additional material as required. They can, therefore, be used as a key document in a client's consideration of family governance issues.
  • Reservation of powers: A founder can be both a council member and a guardian and can also have such rights (if any) in respect of the foundation and its assets as the constitutional documents provide. These features can be important for clients who wish to retain a significant degree of control in relation to the structure being created.

Orphan structures for specified purposes

Significant numbers of foundations have been incorporated as orphan structures for specified purposes, whether to own certain assets or to perform particular roles.

  • PTCs: A particular example to note is that of a foundation being used to hold the shares in a private trust company (PTC)> which acts as trustee of one or more family trusts. This can be an attractive option for some clients, as an alternative to the PTC being owned by a charitable or non-charitable purpose trust. A foundation can also be incorporated to act as the trustee itself in place of (or as) the PTC. This option simplifies the structuring, as it involves just one vehicle (the foundation) rather than two (the PTC and the vehicle that owns the PTC).
  • Other examples: Other examples to mention are of foundations being incorporated to hold the shares in a company, which acts as a protector of a trust, an enforcer of anon-charitable purpose trust, a council member of a foundation, or a general or limited partner of a limited partnership. Alternatively, a foundation can also be incorporated to discharge any of these roles itself.


One of the most important uses for Jersey foundations identified to date is in relation to philanthropy.

  • Choice of objects: A foundation can be incorporated to pursue a client's chosen causes — causes that he or she is passionate about — whether or not they are technically charitable. This flexibility is clearly attractive, and significant numbers of foundations have been incorporated with philanthropic objects, either alone or in conjunction with objects for the benefit of people.
  • Incorporated vehicle: A foundation exists as a legal entity that holds assets and enters into contracts in its own name. The ability to refer to a foundation as such —and, for example, to use the foundation's name when distributions are made — can be important for clients when considering how their philanthropic giving will work in practice.
  • Ongoing involvement: One of the attractions of foundations for philanthropy is that they allow opportunities for ongoing involvement. For example, the founder can choose to be a council member (and so might participate in a giving committee, distributing the foundation's assets) or might be the guardian (with a monitoring role, to ensure that the council administers the assets and carries out its objects as required by the constitutional documents).
  • Open profile: For some clients, it will be important that a foundation's existence is a matter of public record and that its charter can be viewed by conducting a search of the register of foundations. Where a structure is being established for philanthropic purposes, it can often be appropriate to establish and maintain an open profile and relevant information can be included in a foundation's charter to satisfy a client's objectives in this regard.
  • Choice of name: Another important factor is that there is considerable flexibility as to the choice of name for a foundation, provided that it ends with the word `foundation' or a foreign language equivalent. It is> therefore, possible to use a family name or other name of personal significance for a philanthropic foundation if that is desired or, alternatively, to choose a name that preserves the anonymity of the client.


The number of incorporations and variety of uses seen to date show that the Jersey foundation adds significantly to the structuring opportunities available to clients selecting Jersey as a jurisdiction. Three broad categories of use have become well established, and these continue to grow and develop, utilising the flexibility offered by the Law. It is clear that the Jersey foundation is of interest to clients familiar with foundations and those wishing to take advantage of the features and flexibility offered by the Law, together with other factors (such as political, economic, and geographic stability; a robust and highly regarded regulatory regime; a well-respected judicial system with adherence to the rule of law; a depth and breadth of experience amongst its professional advisers; and proximity to London and its financial markets), which combine to make Jersey an attractive choice of jurisdiction for private wealth-management purposes.

Originally published by Women in Business Law Expert Guides, Trust and Estates.

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.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.