On 25th April 2016, Act XI of 2014 amended the Trusts and Trustees Act (TTA) which introduced the concept of Private Trust Company to Maltese law.
A Private Trust Company (PTC) is an entity authorized to act as a fiduciary and is an alternative to professional trust company. Such PTC is generally prohibited from soliciting business from the general public.
Benefits of PTC:
· A PTC gives prospective settlors or family members the opportunity to be involved in its management;
· Family dispute avoidance and more effective communication with those beneficiaries not directly involved, through which their needs may be ascertained;
· The settlors and the beneficiaries can make a positive contribution to the management;
· There is the possibility of reducing administrative costs.
According to Article 43B of the Trusts and Trustees Act, a PTC is a trustee company which shall upon its registration be permitted to:
· act only as trustee in relation to
a specific settlor or settlors of family trusts and in any case not more than five settlors at the time;
· provide administrative services only in respect of a specific family trust or trusts.
For the sake of clarity, a family trust aforementioned, is a trust created to hold property settled by the settlor/s for both present and future needs of family members of family dependants who are definite and can be ascertained.
A PTC is not required to go through the full authorisation process with the Malta Financial Services Authority (MFSA), but need merely register with them. For the purposes of this registration procedure, the MFSA has issued rules on 29th April 2016 regulating trustees that are subject to this procedure. These rules have laid down additional requirements and conditions relating to the activities of a trustee company, the procedure of registration, the duties of the Directors and any other matters that the authority considers appropriate.