What are some differences between a PTC and a traditional trust?
A PTC is a company (corporate vehicle) that acts as trustee of a trust. Essentially, the trust remains the same as in a traditional trust – the only difference being the acting trustee that is in control of the trust.
Clients have the option of using a corporate trustee or the client can set up a corporate vehicle that acts as a trustee for that underlying trust. In the latter option, there are mechanisms that can be added to the constitution documents to allow more control. It is possible to elect a board and the client can choose whom they want to appoint as directors of that corporate vehicle, which typically comprises a combination of their family members or representatives and professionals experienced in trust law and administration.
A corporate trustee like First Names Group can help set up the corporate vehicle such as a Singapore company that will act as trustee; however, the constitution would be slightly different as it will be drafted specifically for a private trust company, as opposed to a standard private limited company.
For clients looking to establish a PTC in Singapore, it is a requirement to use a licensed trust company to carry out the administration of the trust. This is for the purposes of conducting such checks as may be necessary to comply with the directives of the Monetary Authority of Singapore in regard to the prevention of money laundering or countering the financing of terrorism. The licensed trust company would typically assist with the preparation of trustee resolutions, keep the trust documentation in good order, and keep a close eye on the PTC arrangement itself. Representatives from the licensed trust company may also sit on the board of the PTC.