The Private Trust Companies Act, 2012-22 (the Act) has
been enacted into law in Barbados and was proclaimed on May 16,
2014. The Act provides an innovative product to enhance the
international structure offering for companies and ultra high net
worth individuals and families.
A Private Trust Company (PTC), essentially, is a company which
is incorporated for the main purpose of acting as a trustee of a
specific trust, or a number of related trusts. To give some
perspective, this can be compared to a professional trust company
which is in the business of acting as trustee, and providing trust
administration services to the public at large for a fee. PTCs have
been quite popular in various jurisdictions for about 20 years,
with the main benefits including:
Allowing wealthy individuals and/or
families to establish trusts and maintain a substantial degree of
control over the trustees. This control is achieved by the
individuals or family members being directors on the board of the
A corporate structure tends to be
more readily understandable by non-professionals, particularly
those from non-trust jurisdictions, and can be easily integrated
into a family office or commercial structure
PTC structures can enhance
confidentiality, which is of particular interest to clients from
jurisdictions where concerns over financial privacy are driven by
issues of personal safety
PTC structures offer some protection
to trustees in circumstances where the underlying assets of a trust
comprise speculative investments, or investments which involve a
degree of risk (e.g. private shares of an operational company owned
by the family) which might, in some circumstances, be regarded as
unacceptable to a risk–averse professional trustee.
In order to qualify as a PTC under the Act, certain conditions
must be met. These include:
The company must be a Barbados
company which was first incorporated under the Companies Act,
Cap. 308 of the Laws of Barbados
The articles of incorporation must
state that it is a PTC and the name of the company must end with
the words "Private Trust Company", or the abbreviation
The company must not solicit trust
business from members of the public
No business other than that of being
the trustee, protector or administrator of the trust (or managing
or administering trusts) must be carried on by the company
All of the company's trust
business must be 'related trust business'
The company must appoint at least one
'Special Director' who is a resident of Barbados and has at
least five years' experience in a discipline related to the
administration of trusts. This discipline may include law, finance,
accounting, investment management, or trust and estate
The company is required to have a
Registered Agent in Barbados at whose office the registered office
of the company shall be located.
The Registered Agent's Obligations
The Registered Agent of the PTC must satisfy itself that the
conditions of the Act are met, and it is required to do this both
at the outset, and on a continuing basis thereafter. It is also
obliged to take all reasonable steps to ensure that up-to-date
copies of documents, such as the trust deed and any document
varying its terms (in relation to each PTC for which it acts as
registered agent),are kept at its office in Barbados.
The Registered Agent is required to file an annual declaration
of compliance which includes a statement to the effect that the PTC
satisfies the requirements of Money Laundering and Financing of
Terrorism (Prevention and Control) Act 2011-23 of the Laws
of Barbados, and that it operates only as a PTC.
If the trust is managed by a trustee licensed under the
International Financial Services Act, Cap. 325, and its activities
are restricted to engaging exclusively to trading (i.e. buying,
selling, holding or managing) securities, it is exempted from tax
under the laws of Barbados.
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.
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