Liechtensteins legal forms
The continuity of the legal principles and many years of experience in their application make Liechtenstein company forms one of the leading instruments of international asset structuring. The most frequently used legal forms are:
Foundations have a long tradition in Liechtenstein and offer the founder many structuring options. He can use them for example for the benefit of his own family or for charitable purposes. The foundation is a legal entity where the assets have been given for a specific purpose. It is created by a founder who determines its purpose and the possible beneficiaries and also dedicates its assets. In this way, the assets become independent and acquire their own legal personality. As a result, it is no longer attributed to the private assets of the founder. The family foundation is an excellent vehicle to secure assets for one or more generations, for this reason this form is the most frequently deployed in Liechtenstein. The minimum capital amounts to 30 000 Swiss francs, euros or US dollars.
The Liechtenstein trust is as well as the foundation suitable for planning the protection of assets and for succession planning. Trust assets are dedicated to the trust, which are transferred by the Settlor to a Trustee. The transfer is accompanied by the Trustees obligation to administer and use these trust assets in his own name but for the benefit of one or more beneficiaries. A trust is not a legal person, but instead a contractual legal relationship. Trusts may also be used for charitable, social, cultural or similar purposes and may be compared to the trust settlements or family trusts of English-speaking jurisdictions. The Liechtenstein Trust is filed with the public register.
The company limited by shares
The Liechtenstein company limited by shares (“Aktiengesellschaft”, short form: “AG”) is a legal entity and is suitable for large as well as small and medium enterprises. The purpose of the Liechtenstein AG may be of a commercial or non-commercial nature, and may be established for any legally permissible purpose, e.g. for trading in goods or patents, acquiring shareholdings or real estate, financing, property management or asset management. The capital pursuant to the articles may be stipulated in Swiss francs, euros and US dollars, whereby the minimum capital amounts to 50 000 Swiss francs, euros or US dollars. The minimum capital must be fully paid up at the time of incorporation or provided in the form of tangible assets. The capital is freely available to the company once this has been entered in the commercial register. The liabilities of the company are covered by the assets of the company only. The supreme body of the company is the shareholders’ meeting, which is responsible inter alia for electing the management and utilising the profits. The management is responsible for the management and representation of the company. Liechtenstein AGs are obliged to file audited accounts.
The establishment is a special Liechtenstein legal form; it does not exist in this form in any other country. Because of its flexibility, it can be used in many ways. The Liechtenstein establishment is a legal form under private law and should not be confused with the public-law establishments that exist in other legal systems. The Liechtenstein establishment is a legal entity for whose liabilities the assets of the establishment may be held liable only. The Liechtenstein establishment may be structured in the manner of a foundation or a corporation and the capital may be divided in shares. Depending on its structure, it can be used for commercial purposes, for succession planning, asset protection and management. Most establishments in Liechtenstein are those that have neither members nor partners or shareholders, i.e., they have beneficiaries who receive pecuniary benefits from the establishment. The minimum capital amounts to 30 000 Swiss francs, euros or US dollars and is freely available to the establishment once this has been entered in the commercial register.
The registered trust company
A registered trust company (“Trust reg.”) is a form of legal entity which only exists in Liechtenstein. It is registered in the public register and can than be put – like an establishment – to a wide variety of uses. The company may be structured like a corporation and pursue commercial purposes, or it may be structured like a foundation and serve private or charitable purposes. The capital of a registered trust company is known as the trust fund, and amounts at least to 30 000 Swiss francs, euros or US dollars. The supreme body is the trustor, who makes the resources for the trust fund available as the capital provider. The administrative functions of the registered trust company are exercised by a board of trustees according to the purpose of the Trust reg. Like all other companies in Liechtenstein, the registered trust company is subject to normal tax rates, which guarantees legal certainty in an international business environment.