The Liechtenstein foundation is administered by at least two foundation board members, one of whom must be a trustee licensed in Liechtenstein or a person with comparable authorization.
In our practice, it has proven successful for clients to draw up the foundation documents together with one of NK’s lawyers. This lawyer then usually sits on the foundation board alongside the trustee. This ensures that even after the foundation has been set up, the knowledge of the motives and objectives of the foundation’s establishment, even beyond what is written down in the foundation documents, is incorporated into the foundation’s administration.
In practice, it has proven to be a good idea to appoint the lawyer who draws up the foundation deeds to the foundation council as well.
Part 1 of this series already mentioned that the Liechtenstein foundation can grant the founding family considerable influence. Under Liechtenstein foundation law, even the founder or founders can be part of the foundation board. In most cases, however, this will not be advisable for tax reasons and asset protection considerations. For this reason, the establishment of a family advisory board has become established, which can also consist entirely of members of the founder’s family. Such an advisory board can have either mere advisory or genuine approval rights. Here too, tax and asset protection considerations are decisive.
In addition to the advisory board, a protector can also be provided, who is also granted advisory or approval rights. Such a protector is often a third party who is also a confidant of the founder or the founder’s family.
Part 3 of this series deals with the establishment of a Liechtenstein sub-foundation from an Austrian perspective.
