How the Process Works

Phase 1 — Preliminary analysis and objective setting

Every trust establishment begins with an in-depth analysis phase. The trustee, in collaboration with the client's legal and tax advisers, reviews the future settlor's financial, family and tax situation to determine whether a trust is the most appropriate structure and, if so, which type of trust is best suited.

This phase typically includes:

• A confidential meeting with the future settlor to understand their objectives (asset protection, succession planning, family governance, philanthropy)
• Analysis of relevant jurisdictions for the trust's establishment (choice of proper law)
• Assessment of tax implications in the jurisdictions of residence of the settlor, beneficiaries and asset location
• Identification of stakeholders: trustee, protector, beneficiaries, investment adviser
• An initial estimate of costs and timeline

Phase 2 — Structuring and drafting

Once the objectives have been defined and feasibility confirmed, the structuring phase begins. This is the most critical step as it determines the legal architecture of the trust for decades to come.

The trustee coordinates the drafting of the constitutive documents, which mainly comprise:

• Trust Deed: The founding document establishing the terms of the trust, the trustee's powers, the classes of beneficiaries, distribution rules and governance mechanisms.
• Letter of Wishes: A confidential document in which the settlor expresses non-binding intentions regarding the management and distribution of trust assets.
• Memorandum of structure: An internal document describing the economic and estate planning rationale for the trust, essential for compliance and substance.

The drafting of the trust deed is typically entrusted to a law firm specialising in the chosen jurisdiction (Jersey, Guernsey, etc.), in close coordination with the Swiss trustee and tax advisers.

Phase 3 — Due diligence and compliance

Before the formal establishment of the trust, the Swiss trustee must carry out comprehensive due diligence in accordance with the Anti-Money Laundering Act (AMLA) and international standards. This phase includes:

• Identification and verification of the identity of the settlor, beneficiaries and beneficial owner
• Verification of the origin of funds and the legality of assets to be transferred into the trust
• Screening against sanctions lists (SECO, OFAC, EU, UN)
• Risk profile assessment and file classification
• Documentation of the compliance file (KYC/AML file)

Phase 4 — Establishment and asset transfer

The formal establishment of the trust takes place upon execution of the trust deed by the settlor and acceptance by the trustee. The settlor then transfers assets to the trust according to a pre-defined transfer plan.

In parallel, the trustee proceeds with opening bank accounts in the name of the trust with a Swiss bank. This step typically takes 4 to 8 weeks as the bank conducts its own due diligence. The choice of bank depends on the size of the trust, the nature of assets and the services required (wealth management, custody, Lombard lending, etc.).

Phase 5 — Ongoing administration

Once the trust has been established and assets transferred, ongoing administration begins. The FINMA-licensed trustee carries out its fiduciary obligations on a continuous basis:

• Asset management in accordance with the trust deed and letter of wishes
• Trust accounting and preparation of annual accounts
• Distributions to beneficiaries according to the terms of the trust
• Tax reporting (CRS, FATCA, local declarations where applicable)
• Periodic meetings with beneficiaries and the protector
• Annual compliance and risk profile review
• Coordination with wealth managers, lawyers and tax advisers

Trust administration is a long-term responsibility. The trustee must constantly adapt to changes in beneficiaries' circumstances, applicable regulations and the economic and tax environment.