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The concept of Trusts, as understood in Anglo-American jurisdictions, is not explicitly recognized in German law, including Frankfurt. However, certain principles and arrangements akin to Trusts can be seen in German Foundation Law (Stiftungsrecht), Contract Law (Vertragsrecht), and Family Law (Familienrecht). It's highly recommended to seek expert advice to navigate within legal confines while defining similar arrangements.
Legal expertise is crucial to navigate the complex German legal system while arranging your assets, especially in a manner adhering to the principles of Trusts. A lawyer can help you define protective mechanisms for your assets, advise on tax, inheritance law, succession planning, and similar requirements. Professionals in the field also guard against the misuse of assets and ensure they are properly managed and distributed as per the stipulations of the arrangement.
The Bürgerliches Gesetzbuch (Germany’s Civil Code) and the Handelsgesetzbuch (Germany’s Commercial Code) govern matters related to asset management and distribution in Germany. German law emphasizes contractual relationships, maintenance obligations, and transfer of inheritance. Despite the absence of Trust Law per se, mechanisms like 'Treuhand' arrangements, Family Foundations and Non-Profit Foundations can be utilized to achieve a similar effect as trusts. It's also crucial to understand the impact of German tax law while arranging assets.
The concept of a 'Treuhand' is the nearest equivalent to Trusts, which is essentially an agreement where the legal title of the property is transferred to the trustee, who manages the asset for the benefit of another person or entity.
Germany's legal system doesn't recognise trusts. However, Germany is a signatory to the Hague Convention on the Law Applicable to Trusts and on their Recognition, therefore, trusts set up in jurisdictions that do recognize them are recognized for certain purposes in Germany.
If the Settlor, the Trustee, or the Beneficiary is a resident in Germany, a foreign trust may have tax implications in Germany. Detailed advice should always be sought in this regard.
'Treuhand' is an arrangement where one person owns legal title to an asset, but holds it and manages it for the benefit of another.
Yes, but it depends on the circumstances. As a signatory to the Hague Convention on the Law Applicable to Trusts and on their Recognition, Germany may recognize trusts set up in jurisdictions that recognize them, though enforcement may depend on the specifics of the case.
The Bundesministerium der Justiz und für Verbraucherschutz (Federal Ministry of Justice and Consumer Protection) and Bundeszentralamt für Steuern (Federal Central Tax Office) websites are good resources for understanding legal and tax implications. Professional bodies like the Deutscher Anwaltverein (German Bar Association) and Frankfurt's local legal organisations can also help find legal counsel.
If you need legal assistance, contact a lawyer who specializes in German civil, inheritance, and tax law, preferably one with experience in 'Treuhand' agreements or similar arrangements. Always ensure to prepare a clear outline of your needs and goals to discuss in your initial consultation.
