Asset Protection: The Cayman Islands Versus Other Jurisdictions
A trust has been the most dependable vehicle for asset protection. But in the presence of more than 50 jurisdictions to settle a trust, how should you know where to settle your trust?
Jurisdictions having reliable trust laws could readily be chosen from any of England’s current and past colonies. These jurisdictions have inherited England’s rules that make trust accounts possible. Basing on this criterion alone still leaves you with numerous choices, but there are factors to consider that might help you choose the best place for you to settle a trust.
First, you should ensure that the jurisdiction that you want to settle your trust on is both economically and politically stable. Nigeria, Zimbabwe and the Cayman Islands had been English colonies and are able to handle trust. But a favorable trust law will be the least of your worries if you are considering placing a trust on one of these countries.
Another concern that you should consider in choosing a jurisdiction to place your trust in is its fraudulent conveyance rules. These rules establish criminal penalties on acts of withholding properties to creditors. At the same time, it voids claims coming from unknown future creditors.
The primary concern of an OAPT is to protect your asset from judgment coming from foreign countries specifically the settler’s domicile. Though some claims may be considered on the grounds of the assets being derived from fraud and other illegal activities, this process could not be done without a court order.
Another important thing about protection your assets via an offshore trust is that it should not be taxed by the country that has the jurisdiction over the trustee.
Taking all this considerations in mind, jurisdictions such as the Bahamas, Cayman Islands and the Cook Islands comes relatively well for jurisdictions to settle an offshore asset protection trust.