The Trust, a useful and dynamic instrument, may be used in numerous applications
overruling the rigid and formal characteristics of traditional civil law instruments
The Trust is a regulation of Anglo-Saxon origin which has gained importance in Italy as a result of the transposition, by means of Act No. 364 of October 16th,1989, of the Hague Convention (dated July 1st,1985) in relation to the Law Applicable to Trusts and their recognition (the “Convention”).
Pursuant to Art. 2 of the Convention, trust means ‘legal relationships created – inter vivos or on death – by a person, the settlor, when assets have been placed under the control of a trustee for the benefit of a beneficiary or for a specified purpose.”
The Trust in the Italian Legal System
As domestic legislation, governing the legislation fully, has not yet been adopted in Italy, any trust established by Italian citizens resident, having as their object property situated in the territory of the state and in favor of Italian beneficiaries (so-called “Domestic Trust”) must be governed and operate in compliance with the provisions of the Convention as well as the law regulating foreign trust that has been chosen by the settlor. In the area of taxation, the establishment has received a first regulation with the Act of 27 December 2006 No. 296.
Consider, however, that Article 15 of the Hague Convention is without prejudice to the application of the mandatory rules of the law that cannot be violated by the establishment of trust with respect to which, its typical effects are not produced. In particular, among others, strictly enforceable are the provisions relating to (i) the protection of minors and disabled persons, (ii) personal effects and assets of marriage, (iii) wills and devolution of successor goods and (iv) protection of creditors in cases of insolvency.
Trust Fund Assets
May be linked to a trust fund for movable and immovable property, registered movable property, money, social equity and other rights, including benefits and use derived from the goods and rights included in the fund itself.
With the signing of the statutory deeds or of successive transfer deeds, the settlor transfers ownership of certain assets to the trustees, who will have to manage, administer them and distribute them in accordance with the provisions contained in the statutory deed and in compliance with the provisions of the applicable law.
For the purpose of such transfer, trust assets shall be, for the entire duration of the trust, separate and distinct with respect to the personal assets of the settlor, but also from the personal assets of the subject that plays the role of trustee and from the personal assets of the beneficiaries.