Gaining a Global View of Ownership Structures(to Channel Ultimate Tax Efficiency and          Asset Protection)         by...
Challenges of Global Assets  Marcus Evans Elite Summit   Barbara R Hauser LLC   2
To Opportunities   chaos                          Strategy                   Marcus Evans Elite Summit                   B...
Goal: Safeguard from Risks Country Instability Foreign Taxes Claims against the client Failure to leave to the chosen heir...
Example Swiss accounts Paris apartment New York apartment Equity in private firms Stock in US public/listed companies Jers...
Likely Chaos Taxes could apply: UK, France, USA etc ◦   Wealth tax ◦   Capital gains tax ◦   Inheritance tax ◦   Will a tr...
Client Concerns Minimize all taxes Ensure that wealth passes on as the client wishes Avoid exposure to risks and claims   ...
Global Four-Step Solution       Four-1.   Conduct an Ownership Audit2.   Choose/change the Jurisdiction/s3.   Consider a T...
The 4-Step Process    4-                                                           Governance                             ...
#1-Ownership Audit#1-1.   The first and most critical step is for the     family to have an "ownership audit" of     exact...
Ownership Audit -- Elements             • The legal type of asset matters    What             • The legal owner matters   ...
ExampleOwnership of stock may be an “intangible”—locatedwhere the client “is”Ownership of a home is likely to be a “fixed”...
What do they own?                              Listed                              Stock                                  ...
Who is the legal owner? Individual client Married couple (spouse rights) Undivided Hindu Family Private company Off-shore ...
Why does the owner matter?                         Right to                     transfer/sell/gift       Inheritance      ...
Example Individual owner – free rights to transfer Married owner – must consider spousal rights Partnership – terms of agr...
Why does the location matter?                          Right to                      transfer/sell/gift        Inheritance...
Example USA – freedom to dispose (with taxes) UK – dependents’ claims France – forced heirship Switzerland – may follow ci...
#2- Choose a Jurisdiction (or two)#2-                    Marcus Evans Elite Summit                    Barbara R Hauser LLC...
Why the Jurisdiction MattersImportant General Attributes: Stable law (including trust law) Good Professionals Convenience ...
What the Jurisdiction Controls Taxes Inheritance Claims ◦ Commercial creditors ◦ Family disputes                          ...
Jurisdiction in ParticularConsider client’s particular risks: Where are the client’s assets                and Who might m...
# 3 Use a Trust (or two)?  Client                                Beneficiaries             Trustee                       M...
Why Consider a Trust ?Advantages: Diversification Central Management Safety Control through generationsDisadvantages: Comp...
Choice of Trustee Extremely important Many choices: ◦ “big bank” ◦ Professional private trust company ◦ Family private tru...
Last: The Worst Risk: Family Conflict LOreal Heiress Liliane Bettencourt --Loses Control Of Her $23 Billion Fortune Pritzk...
# 4-Create Strong Governance  4-Create a strong family governancestructure to keep the family in alignment(and to avoid th...
What is Family Governance?Answer:“How the family makes decisions together”                        Marcus Evans Elite Summi...
Range of Governance OptionsDictator (some Patriarchs/Matriarchs)Benevolent Ruler (some Patriarchs/Matriarchs)Appointed Lea...
Best Practices Globally Family Constitution Family Council Family Assembly                       Marcus Evans Elite Summit...
Process to Follow        Constitution          Council         Assembly            Marcus Evans Elite Summit            Ba...
The Family Constitution    • Preamble: Why are we doing this?    • Who will make what rules on what      subjects and how?...
The Family Council  Who is on it?  What can it do?  What can it not do?                        Marcus Evans Elite Summit  ...
Participatory Process: The Key All contribute to the Process All views are considered Compromises and Consensus Result Fle...
Strong Governance ResultsCreates a strong family governancestructure to keep the family in alignment(and to avoid family d...
Conclusion: Four Steps to Success#1—Conduct Ownership Audit#2—Choose good Jurisdictions#3—Consider Trusts#4—Create strong ...
References--Books ◦ International Family         International Estate   Governance (Amazon)          Planning: A Reference...
Additional References See www.brhauser.com (includes articles to download) and Appendix in International Family Governance...
Selected BooksGeneration to Generation: Life Cycles of the Family Business(Gersick, Lansberg, etc.)Family: The Compact amo...
Questions?Thank you, and feel free to email me withany additional questions.  Barbara Hauser (BRHauser@gmail.com)         ...
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Gaining a Global View of Ownership Structures - Presentation by Barbara R Hauser LLC - Elite Summit

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For more information contact: emailus@marcusevans.com

Barbara R Hauser LLC shared her presentation entitled "Gaining a Global View of Ownership Structures" at the marcus evans Elite Summit 2012

Join the November 2014 Summit along with leading European family offices and global asset managers in an intimate environment for a focused discussion of key new drivers shaping wealth management strategies today.

For more information contact: emailus@marcusevans.com

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Gaining a Global View of Ownership Structures - Presentation by Barbara R Hauser LLC - Elite Summit

  1. 1. Gaining a Global View of Ownership Structures(to Channel Ultimate Tax Efficiency and Asset Protection) by Barbara R Hauser LLC For Marcus Evans Elite Summit Montreux 31 May 2012
  2. 2. Challenges of Global Assets Marcus Evans Elite Summit Barbara R Hauser LLC 2
  3. 3. To Opportunities chaos Strategy Marcus Evans Elite Summit Barbara R Hauser LLC 3
  4. 4. Goal: Safeguard from Risks Country Instability Foreign Taxes Claims against the client Failure to leave to the chosen heirs Poor Management Family Disputes Marcus Evans Elite Summit Barbara R Hauser LLC 4
  5. 5. Example Swiss accounts Paris apartment New York apartment Equity in private firms Stock in US public/listed companies Jersey trust Marcus Evans Elite Summit Barbara R Hauser LLC 5
  6. 6. Likely Chaos Taxes could apply: UK, France, USA etc ◦ Wealth tax ◦ Capital gains tax ◦ Inheritance tax ◦ Will a treaty help? Disclosure reports for USA? (FBAR & FATCA) Local inheritance rules apply? Trust recognized? Marcus Evans Elite Summit Barbara R Hauser LLC 6
  7. 7. Client Concerns Minimize all taxes Ensure that wealth passes on as the client wishes Avoid exposure to risks and claims Marcus Evans Elite Summit Barbara R Hauser LLC 7
  8. 8. Global Four-Step Solution Four-1. Conduct an Ownership Audit2. Choose/change the Jurisdiction/s3. Consider a Trust4. Create strong Governance Marcus Evans Elite Summit Barbara R Hauser LLC 8
  9. 9. The 4-Step Process 4- Governance Trust Jurisdiction/s Ownership audit Marcus Evans Elite Summit Barbara R Hauser LLC 9
  10. 10. #1-Ownership Audit#1-1. The first and most critical step is for the family to have an "ownership audit" of exactly what they own2. In whose name, and3. where it is located. Marcus Evans Elite Summit Barbara R Hauser LLC 10
  11. 11. Ownership Audit -- Elements • The legal type of asset matters What • The legal owner matters Who • The “location” matters Where Marcus Evans Elite Summit Barbara R Hauser LLC 11
  12. 12. ExampleOwnership of stock may be an “intangible”—locatedwhere the client “is”Ownership of a home is likely to be a “fixed” asset—subject to the laws of where it is locatedInvestment ownerships (and insurance) may becontrolled by a contractMarital property may be subject to spouse rights Marcus Evans Elite Summit Barbara R Hauser LLC 12
  13. 13. What do they own? Listed Stock Private Homes Equity Client Insurance Collections Marcus Evans Elite Summit Barbara R Hauser LLC 13
  14. 14. Who is the legal owner? Individual client Married couple (spouse rights) Undivided Hindu Family Private company Off-shore company Trustee Holding Company Other Marcus Evans Elite Summit Barbara R Hauser LLC 14
  15. 15. Why does the owner matter? Right to transfer/sell/gift Inheritance Exposure to impact taxes & claims Marcus Evans Elite Summit Barbara R Hauser LLC 15
  16. 16. Example Individual owner – free rights to transfer Married owner – must consider spousal rights Partnership – terms of agreement? Corporate owner– who owns the company? Trust – will the Trust be valid? Marcus Evans Elite Summit Barbara R Hauser LLC 16
  17. 17. Why does the location matter? Right to transfer/sell/gift Inheritance Exposure to impact taxes & claims Marcus Evans Elite Summit Barbara R Hauser LLC 17
  18. 18. Example USA – freedom to dispose (with taxes) UK – dependents’ claims France – forced heirship Switzerland – may follow citizenship Gulf Region – Shariah law may apply Marcus Evans Elite Summit Barbara R Hauser LLC 18
  19. 19. #2- Choose a Jurisdiction (or two)#2- Marcus Evans Elite Summit Barbara R Hauser LLC 19
  20. 20. Why the Jurisdiction MattersImportant General Attributes: Stable law (including trust law) Good Professionals Convenience Marcus Evans Elite Summit Barbara R Hauser LLC 20
  21. 21. What the Jurisdiction Controls Taxes Inheritance Claims ◦ Commercial creditors ◦ Family disputes Marcus Evans Elite Summit Barbara R Hauser LLC 21
  22. 22. Jurisdiction in ParticularConsider client’s particular risks: Where are the client’s assets and Who might make a claim (and what kind? and where?) Marcus Evans Elite Summit Barbara R Hauser LLC 22
  23. 23. # 3 Use a Trust (or two)? Client Beneficiaries Trustee Marcus Evans Elite Summit Barbara R Hauser LLC 23
  24. 24. Why Consider a Trust ?Advantages: Diversification Central Management Safety Control through generationsDisadvantages: Complexity, cost & administration Marcus Evans Elite Summit Barbara R Hauser LLC 24
  25. 25. Choice of Trustee Extremely important Many choices: ◦ “big bank” ◦ Professional private trust company ◦ Family private trust company Add a Protector? ◦ Ability to remove Trustee ◦ Expand into a family Protector Committee? Marcus Evans Elite Summit Barbara R Hauser LLC 25
  26. 26. Last: The Worst Risk: Family Conflict LOreal Heiress Liliane Bettencourt --Loses Control Of Her $23 Billion Fortune Pritzker Lawsuit Divides Family The notoriously private owners of Hyatt – The Pritzker family – have decided to part ways, leaving billions in assets up for grabs. GCC - The Saad-Algosaibi disaster Lack of transparency in Saudi firms’ feud leaves billions in losses hidden Family Feuds Grip Ho Casino Empire & Yung Kee Restaurant brothers Marcus Evans Elite Summit Barbara R Hauser LLC 26
  27. 27. # 4-Create Strong Governance 4-Create a strong family governancestructure to keep the family in alignment(and to avoid those claims) Marcus Evans Elite Summit Barbara R Hauser LLC 27
  28. 28. What is Family Governance?Answer:“How the family makes decisions together” Marcus Evans Elite Summit Barbara R Hauser LLC 28
  29. 29. Range of Governance OptionsDictator (some Patriarchs/Matriarchs)Benevolent Ruler (some Patriarchs/Matriarchs)Appointed LeaderElected LeaderParticipatory System Marcus Evans Elite Summit Barbara R Hauser LLC 29
  30. 30. Best Practices Globally Family Constitution Family Council Family Assembly Marcus Evans Elite Summit Barbara R Hauser LLC 30
  31. 31. Process to Follow Constitution Council Assembly Marcus Evans Elite Summit Barbara R Hauser LLC 31
  32. 32. The Family Constitution • Preamble: Why are we doing this? • Who will make what rules on what subjects and how? • How will we allow changes and ask the next generation to sign on? Marcus Evans Elite Summit Barbara R Hauser LLC 32
  33. 33. The Family Council Who is on it? What can it do? What can it not do? Marcus Evans Elite Summit Barbara R Hauser LLC 33
  34. 34. Participatory Process: The Key All contribute to the Process All views are considered Compromises and Consensus Result Flexibility & Amendability are Crucial Marcus Evans Elite Summit Barbara R Hauser LLC 34
  35. 35. Strong Governance ResultsCreates a strong family governancestructure to keep the family in alignment(and to avoid family disputes) Marcus Evans Elite Summit Barbara R Hauser LLC 35
  36. 36. Conclusion: Four Steps to Success#1—Conduct Ownership Audit#2—Choose good Jurisdictions#3—Consider Trusts#4—Create strong family Governance Marcus Evans Elite Summit Barbara R Hauser LLC 36
  37. 37. References--Books ◦ International Family International Estate Governance (Amazon) Planning: A Reference Guide (JurisPub) Mommy, Are We Rich? Marcus Evans Elite Summit Barbara R Hauser LLC 37
  38. 38. Additional References See www.brhauser.com (includes articles to download) and Appendix in International Family Governance LinkedIn Group: “International Family Governance” Marcus Evans Elite Summit Barbara R Hauser LLC 38
  39. 39. Selected BooksGeneration to Generation: Life Cycles of the Family Business(Gersick, Lansberg, etc.)Family: The Compact among Generations and Family Wealth:Keeping it in the Family (Jay Hughes)Creating Effective Boards for Private Enterprises (John Ward)The Rule of Law: On History, Politics,Theory (Brian Tamanaha)Theory of Justice (John Rawls)Flow: The Psychology of Optimal Experience (MihalyCsikszentmihalyi) (core meaning of “a good life”) Marcus Evans Elite Summit Barbara R Hauser LLC 39
  40. 40. Questions?Thank you, and feel free to email me withany additional questions. Barbara Hauser (BRHauser@gmail.com) Marcus Evans Elite Summit Barbara R Hauser LLC 40

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