Belize Trust
It is required, that a Trust be registered with the Belize Trust Registry In Belmopan for a fee of US$100, in exchange for which the Registrar issues a Certificate of Registration to the Trust Agent The Register of Trusts cannot be revealed as to that trust without the specific, written consent of the Trustee.
A Trust can only be registered by a licenced (one who is registered with the Belize International Financial services Commission) approved Trust Agent.
Trusts may be formed either orally or by written declaration, with no mandatory declarations and only a few statutory requirements, with the exception of unit trusts or trusts which relate to Belize property (these must be formed by formal written documents).
It is possible to draft the trust and specify that particular parts will be governed by the laws of other jurisdictions, and it is possible to specify that in the event of changes in a designated jurisdiction's laws that yet another jurisdiction's laws will apply. This provision can be important for "international" trusts insofar as a change of law in a designated jurisdiction may operate to void an important provision of the trust; in that case, the designation of the alternative jurisdiction will help ensure that the trust will be enforced according to the wishes of the settlor. However normally the Laws Of Belize will apply to all Belize Trusts.
Abolition of the Rule against Perpetuities
Belize has abolished the Rule Against Perpetuities as it relates to Belizean trusts. A trust may be created for a maximum of 120 years without regard to whether proper beneficiaries have been identified or not. Charitable trusts, as defined under the statute, may be established with unlimited duration.
Asset Protection
Belizean courts cannot vary or set aside a Belizean Trusts. Belizean courts also are prohibited from recognizing foreign judgments against a Belizean trust or against Belizean trust property, in respect to marriage or divorce, succession of heirs, or claims by creditors (including foreign bankruptcy courts). The Belizean trust companies claim that a Belizean trust has never been compromised, and that Belizean trust assets are completely insulated from all creditors, unhappy heirs, and mad ex-spouses which attempt to use fraudulent conveyance laws and bankruptcy orders to penetrate the trusts. The Belize Trust Act also provides that an asset transfer has protection from fraudulent conveyance allegations as of the date of the transfer.
Settlors, Beneficiaries and Purposes
The settlor (creator) of a trust may be any person having the capacity to own and transfer property. Because of the abolition of the Rule Against Perpetuities as to trusts, virtually any person, entity, or thing may be a beneficiary, and it is possible to create broad classes of potential beneficiaries or leave the designation of beneficiaries to the trustees (i.e., "discretionary" trusts are allowed).
Both settlors and beneficiaries may give the trustees "Letters of Wishes" which are non-binding guidelines as to how the trust should be administered. The Trustees are not legally bound to recognize or follow these letters, but in practice they almost always do.
Trustees and Protectors
Belizean trusts must have at least one trustee and may not have more than four trustees, which the exception of charitable trusts which may have an unlimited number of trustees. A Trustee may also be a settlor and a beneficiary of the trust.
All Trustees are held to a very high standard of conduct and faithfulness to the trust. In addition to most typical trustee powers, a trustee of a Belizean trust is empowered by the Trust Act to advance moneys to potential beneficiaries of the trust even before their interests in the trust have vested. Trustees who are engaged in a profession or business which supplies services to a trust are entitled to have the reasonable fees and charges for such services paid by the trust.
The Belize Trust Act specifically allows for (and, for some types of trusts, requires) the appointment of a "Protector" who individually owes fiduciary duties to the trust beneficiaries. While the Protector has the power to remove and appoint trustees, the Protector is not considered to be a trustee. The Protector can also be the settlor, trustee, or beneficiary of the trust.
Breach of Trust
In the event of a breach of trust, trustees are personally liable for the loss or depreciation of the trust assets (but directors of a corporate trustee or trust company do not become personally liable). Further, any who receives trust property with knowledge of the breach of trust become constructive trustees of the trust. For a breach of trust, Belizean law allows for the "tracing" of assets and no Statute of Limitation will apply.
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