Trusts are a very old institution in England, but something of a novelty in Italy, having been introduced more or less 25 years ago, although all legal professionals (lawyers, magistrates and legislators) have since become convinced of their usefulness and flexibility.
A trust is an arrangement whereby a person (the trustee) holds certain assets – real estate, shares, securities, movable property of any kind, from jewels to artworks – as their nominal owner, on behalf of a beneficiary and for a certain purpose. Importantly, the assets held in trust constitute a separate and independent grouping, or pool, of assets, which is not affected by the vicissitudes of either the settlor or the trustee. Furthermore, the assets placed in trust can be changed over time (for example, a property may be placed in a trust and then sold maybe for buying shares).
The parties to a trust are:
- the settlor, who is the owner of the property and assets and the person or entity who decides to create the trust and to place the assets into the trust, for the benefit of someone else or the pursuit of a specific purpose, also establishing the rules that govern the trust. The settlor may be either a physical or a legal person (such as a company);
- the trustee, who is the person who takes over the care of the trust, to pursue the purpose indicated by the settlor. The trustee may also be either a physical or a legal person;
- the beneficiaries, the final parties who receive the benefit of the trust. A trust may also pursue a purpose that does not provide for any beneficiaries, in which case it is called a “trust for a purpose” (e.g., taking care of elderly people, or other charitable purposes, or providing care to animals, or sponsoring an artistic or cultural project);
- the guardian, who supervises whether the trustee effectively implements the purpose identified by the settlor.
All trusts are different and may be tailored to suit each settlor’s needs or a specific purpose.