Legal System In China Family Trust

Family Trust is a family member(usually refers to high net worth individuals)will be handed over to their legitimate property trusts,trust plays the role of trustees,management or operation of the trust property,asset management gains enjoyed by the beneficiary.Among the family wealth management among family trust has dramatically since the advantages,including bankruptcy isolation function,the wealth of heritage features,reasonable tax saving function,the function to protect privacy,high net worth individuals will usually family trust as wealth Inheritance choice.From the perspective of China’s economy,the development of a family trust business is the only way of deepening economic restructuring is an inevitable requirement of economic globalization is the main trend of development of financial markets.Since the reform and opening up,China’s rapid economic growth,the number of HNWIs continued to grow,after many years of accumulation of wealth,the high net worth Chinese people consider not only makes wealth through a variety of investment is increasing,more importantly,realize family wealth effective heritage,although the wealth of heritage there are many ways,the most common is the intestate succession and insurance,but comparing them in terms of a family trust system has unparalleled advantages,therefore,in the development of our family trust is necessary.Although the family trust system in China started late,slow development,but China formulated the "Trust Law" in 2001,the introduction of the Act prelude Trust System in China,"Trust Law" establishes trust such an innovative,flexibility,security,property management and other institutional strengths for the family trust set up and run to provide the basic legal support,coupled with the encouragement and promotion of HNWI wealth concept continues to mature,regulators,and the transformation of trust for the family trust system provides feasibility condition in our country’s development.Development of the road is not always smooth sailing,family trust our legal system on the road to development is also facing some institutional barriers,specifically in the following aspects: 1 registration system aspects: trust registration to take effect too harsh doctrine,our registration system will generate trust as an element of the effectiveness of such registration so rich assets exposed to the public,neither the protection of privacy,but also lead to high-end customers uneasy,trust relationship is not built on the parties to the public interest with to the detriment of the case,will not harm the interests of third,also interfere with the freedom and efficiency of the registration,the registration authority at the same time lack of trust,so that the family trust property registration link can not be effectively carried out,hindering the follow-up of the family trust business.2 Tax regime: China has not established a sound trust taxation,nor clearly defined property inheritance tax issues,tax guidelines ordinary contrast,there will be difficult to avoid the double taxation problem,resulting in increased costs to set up a family trust,thereby affecting family trust services to market,at the same time as a family inheritance important driver of trust in our country has not yet been introduced,making wealth inheritance taxes low,family trust tax advantages are not reflected,led to the establishment of awareness of the need for family trust is not strong,traditional methods are more dependent on the legacy of power has not changed,hindering the development of the family trust.3.Ownership: the conflict a matter of a right system with dual ownership between systems,resulting in ownership of the trust property becomes very difficult to measure,the Western countries can not be the same as the definition in additional equity,the trust property ownership unknown,undermining the independence of the trust property,thus affecting the trust property protection implementation.4.The regime trustee: trustee obligations too principled,lack of specific implementation details,limited range trustee,the trustee of the trust in our family are all trusts,individuals largely banned in the trust business,this Although the provisions of the trustee helps prevent moral hazard,to prevent fraud,but reduced the scope of the trustee,it is not conducive to the development and expansion of family trust industry.In response to these obstacles to the development,from a legal perspective we put forward some solutions: the registration antagonism,determine trust registration authority,the implementation of different tax policies,the implementation of inheritance,ownership clear,detailed obligations of the trustee,the trustee expand range,promote the development of family trust the legal system.