A PTC is a company whose sole purpose is to provide trust services to specific trusts or specific group of trusts. A PTC is a useful vehicle to consider for wealthy families with unique needs. It acts as trustee for the family (or any such connected persons) for the benefit of the beneficiaries who have to be connected person(s). In short, a connected person is defined as someone related to the settlor either by blood or adoption. A PTC may also act as trustee for other trusts but the settlors of each individual trust have to be related to each other. Essentially, a PTC can only act as trustee for all family related trust.
How is it formed?
A PTC is formed by incorporating a private company limited by shares. This can be a private company. The PTC must have at least one director who is “ordinarily resident” in Mauritius.
A PTC must appoint a company secretary within 6 months of the date of its incorporation and the company secretary must be residing in Mauritius. He/She must not be the sole director of the PTC.
In a PTC, the settlor can retain control over the assets and his investments by appointing himself and his relatives to sit on the Board of Directors (the “Board”) of the PTC. The Board may also comprise of professionals such as the family’s lawyers, accountants, etc.
It is mandatory for the PTC to engage a licensed trust company to carry out trust administration services for the purposes of conducting the necessary checks to comply with any written direction issued by Financial Services Companies on the prevention of AML/CFT. This can be done by entering into a trust administration agreement with Trustlink International Ltd.
What are the benefits?
The main benefit of a PTC is that the settlor can still oversee the conduct of the trust and more importantly, the family business. This suits a settlor who wants to retain a high degree of control in management of the family assets/business but is keen on having the benefits of these assets being held by a trust. The following are more examples of how a settlor can benefit:-
i. The settlor is more closely involved in the operation of the trust by sitting on the Board of
Directors;
ii. The settlor is able to choose the directors of the PTC who are familiar with the trust assets or family
business where speedy decisions need to be made;
iii. The settlor can have clear succession planning strategies for the family business by identifying suitable
successors;
iv. The PTC is able to hold assets where a licensed trust company is not comfortable in administering;
v. Manage complex family circumstances or situations where an external trustee may not be in a position to manage.