Posted on 24th June 2009
From July philanthropists will be able to set up a 'flexible' foundation with a mixture of charitable and non-charitable purposes free from mainland charity regulation as a result of new Jersey laws passed this week.
Jersey Foundations will have features of both corporations and trusts. They will have to be registered in Jersey, will be subject to Jersey law and will have to have at least one Jersey resident on their council of members.
They will be tax exempt as charitable foundations are in the UK.
“Jersey Foundations are likely to be popular because they will be flexible and allow a combination of charitable and non-charitable objects,” commented Simon Weil, a partner and charities specialist at law firm Bircham Dyson Bell: “They will also give founders more independence and many philanthropists value this.”
Clive Boothman, Head of the London Office of Jersey Finance, a Jersey government backed non-profit making organisation which promotes and develops the benefits of Jersey as an international finance centre and was instrumental in the creation of the new law, told Philanthropy UK that some investors are looking at a Jersey Foundation as an alternative to a trust, some as a philanthropic vehicle, or both.
“People without a background in common law jurisdictions are less familiar with the trust concept and can sometimes be concerned about losing control over their money, albeit with a letter of instructions to trustees,” Boothman said.
A Jersey Foundation must have a guardian, who can be the founder, whose role will be to monitor a foundation’s council as it carries out its managing role.
“Through this a founder, can keep an eye over the Council, which he can also be a member of, and therefore can perhaps retain more control than he would over a charitable trust,” Boothman said.
