Synopsis
Liechtenstein lies in the region of the upper Rhine between Switzerland and Austria, about 75 miles (a 90 minute drive) east of Zurich, Switzerland which is the nearest International airport. It is Europe's fourth smallest state with an area of approximately 160 square miles. Vaduz is the capital and the seat of Government.
Liechtenstein, like its neighbours, is politically neutral. It is a constitutional hereditary monarchy with a Prince as head of State and a democratically elected parliament. The legal system is based on civil law.
The total population is 32,000 of which 20,000 are citizens of the Principality. The official language of Liechtenstein is German, although English is widely spoken amongst the business community. The Swiss Franc ("CHF") is the official currency and there are no exchange controls.
Banking and financial services are one of Liechtenstein's main industries and within this industry there are high levels of secrecy and confidentiality with heavy sanctions imposed for breaches.
THE LIECHTENSTEIN FOUNDATION
The Foundation, also known as the Stiftung, is the most popular entity offered by Liechtenstein. Foundations are a hybrid entity which incorporates many of the characteristics of both a company limited by guarantee and a trust. This structure has previously been something which is peculiar to Liechtenstein but is an entity which has since been copied by other jurisdictions notably Panama. Gibraltar is also considering introducing legislation to create the Foundation. A Foundation cannot generally be formed to pursue commercial purposes so it is suitable only for holding assets such as properties, shares in other companies and other forms of investments and has traditionally been used to hold and pass assets from one generation to another in complete confidentiality.
Like a company, the Foundation has a separate legal personality distinct from anybody who has an interest in the Foundation but is managed and controlled by a Council, rather than a board of directors, for the benefit of designated beneficiaries.
If the Foundation is "registered" the formation documents ("Articles") are available for inspection at the public registry. If the Foundation is "deposited" the Articles are delivered to the public registry but are not available for inspection. Thus the deposited Foundation is most frequently used and gives the highest degree of confidentiality and the rest of the information appearing herein relates the deposited Foundation.
The Articles would generally state as a minimum:- (1) the name of the Foundation; (2) the purpose and objects of the Foundation; (3) the names of the Council and their signing rights; (4) the amount of the capital of the Foundation. In the case of a deposited Foundation the details of the beneficiaries and the extent to which they may benefit from the Foundation assets are laid down in the "By-Laws" which is a private document kept only at the offices of the local/registered agent.
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Last reviewed: Wednesday, May 26, 2010
Whilst every effort has been made to ensure that the details contained herein are correct and up-to-date, it does not constitute legal or other professional advice. We do not accept any responsibility, legal or otherwise, for any error or omission.
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