¶ 1301
Overview
Two subjects. This chapter completes Part II with two subjects that meet in practice. The first is the private trust company, a Belize company formed to act as trustee of the trusts of one family or one connected group without holding a licence from the Financial Services Commission. The second is the administration of a Belize trust after it has been created and registered: the records the trustee must keep and where it must keep them, the information it must give and to whom, the annual attestation to the Commission, the procedure for distributions, dealings with banks, audit, and the handover of the trust from one trustee to another. The private trust company is the setting in which the administrative duties fall most heavily on persons who are not professional trustees, and the two subjects are therefore treated together.
The statutory sources. The private trust company is a creature of the Belize Companies Act 2022. Part VII of that Act, sections 126 to 128, defines the private trust company, provides that it needs no licence to carry on the trust business the Act permits it, and authorizes regulations for its registration and maintenance. Belize Companies Act, 2022, No. 11 of 2022, ss. 126–128 (Belize). The Belize Companies (Private Trust Companies) Regulations, 2022, made by the Commission with the approval of the Minister and gazetted on November 26, 2022, supply the detail: capital, registered office, registration with the Commission, an annual compliance declaration, fees, a special director and limits on contributions. Belize Companies (Private Trust Companies) Regulations, 2022, S.I. 154 of 2022 (Belize) ("PTC Regulations"). The administrative duties of every trustee, whether a private trust company, a licensed trust company or an individual, come from the Trusts Act as amended in 2023, the Money Laundering and Terrorism (Prevention) Act, the Financial Services Commission Act 2023 and the regulations made under it.
Why families use a private trust company. A family that settles substantial wealth on trust faces a choice of trustee. A licensed trust company brings professional administration and a regulator's supervision, but it is a stranger to the family and its business and charges for its services by reference to the value or complexity of the fund. A private trust company allows the family to place on the board persons who know the family and its enterprises, to keep decisions about a family business within a circle the family trusts, and to change the professional advisers without changing the trustee. The board can include family members, long-standing advisers and independent professionals, in proportions the family chooses within the limits the law sets. Where several family trusts exist, one private trust company can serve as trustee of all of them, so that the trusts are administered consistently and their holdings in the family business are voted together.
The costs of the choice. The private trust company is not a means of escaping regulation. Belize has drawn the exemption narrowly: the company may act only for trusts whose contributors are connected persons, or without remuneration; it must also register with the Commission, keep its registered office with a licensed registered agent, file an annual compliance declaration, pay an annual fee and appoint a special director with experience in trust administration (see infra ¶¶ 1310–1320). The company is a trustee like any other for the purposes of the Trusts Act, so that its directors must see that it performs every duty the Act imposes on a trustee, including the record-keeping and reporting duties added in 2023 (see infra ¶ 1370). A family that forms a private trust company takes on the work a licensed trustee would otherwise do, and the governance of the company becomes a question the family must answer for the life of the trusts.
Relationship to other chapters. Licensing of trust and company service providers, including the registered agents who stand behind every private trust company, is examined in chapter 3 (see supra ¶¶ 330–390). The duties, powers and liability of trustees generally are examined in chapter 7, including the records and reporting duties added in 2023 (see supra ¶¶ 740–750). The use of a non-charitable purpose trust to own the shares of a private trust company is examined in chapter 10 (see supra ¶ 1080.01), and the model purpose clause for such a share trust appears there. Companies under the Belize Companies Act 2022 more generally are the subject of chapter 18, beneficial-ownership reporting and AML/CFT of chapter 29, and economic substance of chapter 28 (see infra chs. 18, 28, 29). This chapter refers to those discussions where they bear on a private trust company and does not repeat them.
Plan of the chapter. Paragraph 1310 examines Part VII of the Belize Companies Act and the definitions on which the exemption from licensing depends. Paragraph 1320 examines registration under the PTC Regulations. Paragraph 1330 examines the private trust company as trustee of a Belize international trust, including the 2023 requirement that such a trust have a Belize corporate or licensed trustee. Paragraph 1340 examines ownership and governance, and paragraph 1350 the duties and liability of the directors. Paragraph 1360 examines the registered agent, AML obligations, beneficial ownership and economic substance. Paragraphs 1370 and 1380 turn to trust administration generally, and paragraph 1390 draws the material together in a set of planning notes and a checklist for establishing a Belize private trust company.