There has been the new Trust Law Bill passed by the Hong Kong government on July 17th, 2013. The new trust law is expanding the default powers of trustees and intended to attract more settlers to favour Hong Kong as their jurisdiction of choice in wealth and estate planning.
The Bill will come into force in December 1st, 2013.
Professor Chan Ka-keung, Secretary for Financial Services and the Treasury, said: “Through the bill, we seek to modernise our trust law and bolster the competitiveness and attractiveness of Hong Kong’s trust services industry, thereby enhancing Hong Kong’s status as an international asset management centre.”
There are a number of major amendments including, but not limited to statutory control of trustees exemption clauses, statutory duty of care, similar to one in the UK, establishing beneficiary’s rights to remove trustees without resorting to the courts. Moreover, the new trust law seeks to protect Hong Kong trusts from strict forced Heirship rules. Also, the Rules Against Perpetuities and Against Excessive Accumulation of Income have been abolished.
Recent amendments significantly improve the Hong Kong Trust Law thus allowing the industry to use new business opportunities in retail funds and private trusts.