These legal structures, established within the Hong Kong jurisdiction, serve as vehicles for managing and protecting assets across generations. They involve a settlor who transfers assets to a trustee, who then holds and manages those assets for the benefit of designated beneficiaries. A common example involves a family establishing such an arrangement to ensure the long-term financial security and well-being of their children and grandchildren.
The employment of these structures offers several key advantages, including asset protection from creditors, potential mitigation of estate taxes, and the facilitation of succession planning. Historically, their popularity has stemmed from the desire to maintain family wealth within a controlled framework, avoiding the complexities and potential pitfalls associated with direct inheritance or business ownership transitions. The stability and robust legal system of the jurisdiction contribute significantly to their attractiveness.
