The Convention governs choice of law and recognition for voluntarily created trusts evidenced in writing.
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SR 0.221.371 · Editorial explanation
Recognition of Foreign Trusts in Switzerland: Hague Trusts Convention
The Convention has applied to Switzerland since 1 July 2007. This is an independently authored explanation of the Fedlex publication, not an official translation; the Convention does not create a domestic Swiss trust form.
Key takeaways
Key takeaways
This material explains the official publication without reproducing it and is not an official translation or individual advice. Current legislation, cantonal practice and the facts must be checked before application.
The settlor's chosen law applies first; without an effective choice, the law of the closest connection is identified.
Recognition entails segregation of trust assets and permits the trustee to act as such, but does not turn the trust into a Swiss legal entity.
Mandatory rules, public policy and third-party rights can limit the result that would otherwise follow from the chosen law.
A Swiss-facing structure also requires separate review of PILA, registration rules, trustee regulation, taxation and the parties' actual powers.
01
Scope and choice of governing law
The Convention covers voluntarily created relationships evidenced in writing where assets are placed under a trustee's control for beneficiaries or a stated purpose. It does not decide preliminary questions about the validity of a will or transaction transferring property to the trustee. The settlor may expressly or implicitly choose a law that provides for the relevant trust; absent a valid choice, the place of administration, location of assets, trustee's residence and trust purposes guide the closest-connection analysis.
02
Recognition and proprietary effects
A recognised trust is given effect according to its governing law. In particular, trust assets are distinct from the trustee's personal estate, should not form part of the trustee's insolvency estate and are not ordinarily available to the trustee's personal creditors. The trustee may sue, be sued and disclose the trustee capacity before a notary or public authority. The way rights are recorded in Swiss registers is additionally governed by domestic Swiss rules.
03
Mandatory rules and practical review
The Convention preserves mandatory provisions that apply irrespective of the conflicts analysis, including protection of minors and incapable persons, matrimonial and succession rules, transfer of title, insolvency, creditor protection and good-faith third parties. Public policy remains an exceptional safeguard. Naming a foreign trust law is therefore not enough: PILA, trustee documentation, Swiss assets and registers, trustee licensing, tax attribution and sanctions exposure must be reviewed for the actual structure.
Fedlex · ESTV · FINMA
Official source
This material explains the official publication without reproducing it and is not an official translation or individual advice. Current legislation, cantonal practice and the facts must be checked before application.
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