As published on step.org/industry-news, Thursday 16 December, 2021.
Macao's government has tabled a draft trust law setting out a legal framework for the establishment and extinction of trusts, trust property and the capacity, rights and duties of settlors, trustees and beneficiaries.
The measure is part of a package to develop wealth management activities in the Macao Special Administrative Region and improve regulation of the financial sector over the next five years.
The trust Bill envisages that trusts will invariably be created by a formal document setting out the trust's purpose, its assets and rights, the identity of the settlor or 'trustor' and the trustees' powers, especially any disposition and acquisition powers. The document will also include the identity of the beneficiaries or a procedure for identifying them, along with their rights to the trust (benefício fudiciário).
It states that the document setting up a contractual trust can generally be private, unless the properties or rights to be included require it to be filed with official registries. However, the Bill requires that trustees must be one of the following types of entity:
Trustees automatically have duties of care, record-keeping and updating, property separation, secrecy, loyalty and impartiality. Depending on the trust's constituent document, the beneficiary can request the trustee to hand over the trust properties, and may request information from the trustee on the management of the trust.
The draft Bill also establishes methods for extinguishing a trust and clarifies that testamentary trusts must follow the relevant rules of the Macao Civil Code.