Guernsey vs Hong Kong
The optimal jurisdiction for trusts
Guernsey vs Hong Kong
Guernsey has a long tradition of providing specialist private wealth management to sophisticated private clients and their families –the island is politically, economically, and environmentally safe and secure.
Guernsey vs Hong Kong - The optimal jurisdiction for trusts
St. Peter Port, Guernsey
Constitutional, political and geographical differences
Jurisdiction Guernsey
Political position in the world
Historical ties to UK
Hong Kong
Constitutional, politcal and geographical differences
A self-governing jurisdiction with more than 800 years of constitutional autonomy, having split from Normandy in 1204.
A British Crown Dependency – relationship with the UK is through the Crown not the UK Parliament.
A former British colony but is now a special administrative region of China.
Right to appeal in UK privy council
Political volatility
Not volatile – secure and stable with candidates typically being elected independently.
Application and principles of English common law
Origins based in Norman-French law, with a strong emphasis on English common law due to strong influence of UK.
A former British colony but became a special administrative region of China in 1997 and is on track to greater integration with China.
Environmentally and geographically stable
✔ No major weather, geological or other environmental disasters.
Highly volatile – increasing influence of China has resulted in the erosion of democratic governance, and so increased political volatility. The passing of the National Security Law is a prime example of this at work.
As a former British colony, the legal system is based on English common law with local legislation codified in the laws of Hong Kong. The passing of the National Security Law has resulted in greater influence of the Chinese Communist Party and further erosion of the common law base.
✔ No major weather, geological or other environmental disasters.
Regulatory and legal differences
Jurisdiction Guernsey
Principal trust
legislation
Hong Kong
Regulatory and legal differences
The Public Trustee (Bailiwick of Guernsey) Law, 2002.
The Trusts (Guernsey) Law, 2007.
Regulatory approvals
Government Fees
Types of trust
(except for certain unit trusts).
Discretionary trust.
Life Interest trust.
Purpose trust (charitable and non-charitable).
Bare trust.
Unit Trust.
Pension Trust.
Employee Benefit Trust.
Trusts with settlor reserved powers permitted.
Reserved powers can be granted to others and are wide ranging – enabling influence on investment and asset management, making distributions and in appointing and removing officers, advisors, trustees, and beneficiaries.
Trust Ordinance.
(except for certain unit trusts).
Discretionary trust.
Fixed trust.
Protective trust.
Accumulation & maintenance trust.
Bare trust.
Unit trust.
Pension trust.
Employee Benefit trust.
Limited reserved powers for trustees.
Regulatory and legal differences
Jurisdiction Guernsey
Establishment time
Hong Kong
Regulatory and legal differences
Within a few days for a straightforward discretionary trust subject to AML requirements being met.
Within a few days for a straightforward discretionary trust subject to AML requirements being met.
Confidentiality
No public filing requirement. Trust documents are confidential.
No public filing requirement. Trust documents are confidential.
PTC legislation and regulations
Discretionary exemptions available subject to discretion of the Regulator.
No specific legislation, but a company limited by shares or guarantee can conduct the function of a PTC.
Regulation of professional trustees
Protectors permitted
Requirement for local assets or local trust administration
Guernsey Financial Services Commission.
Since 2018 by the Registry for Trust and Company Service Providers.
International standards/ products
Jurisdiction Guernsey
Adherence to international standards
EU Economic Substance status
Compliance with OECD
Compliance with FATF
Whitelisted (2019).
Private Trust Companies permitted
Private Trust Foundations permitted
Non-charitable purpose trusts permitted
Private investment/ fund vehicles permitted
Whitelisted (2009).
Compliant with Moneyval and fully committed to the implementation of FATF and CFT recommendations
Product Comparison
✔ Under the Fiduciaries Law.
N/A.
Kong
✔ Under the Fiduciaries Law.
✔ Under the Trusts Law.
✔ A Guernsey Private Investment Fund (PIF) can be created as a bespoke private wealth structure for those investors who hold a family relationship.
Compliant or largely compliant with FATF and CFT recommendations
N/A. ✘ There is no specific legislation – PTCs are typically set up in alternative jurisdictions.
Hong
Torteval Guernsey
