Commercial Trusts

Trust arrangements are widely used in a wide variety of commercial transactions and for various commercial purposes, including:

• Holding loan security: A security trustee may be appointed to hold security over land on behalf of a group of private or pension investors in a property development. A security trustee may also be involved in more complex, higher-value syndicated loan arrangements.

• Asset holding: An asset such as a property may be held by a nominee if the beneficial owner cannot hold the asset directly. This may be for regulatory reasons or to provide commercial anonymity.

• Commercial supply arrangements: A trust may be put in place to provide security for one party for the performance of the other’s obligations, such as in a contract. It could be as straightforward as funds being placed in an account that is held by a trustee and released in specified situations (potentially in tranches) to a supplier. This gives confidence to the supplier that the full funds are available, once it performs its own obligations.

• Share voting: Parties to a commercial arrangement may place shares with a trustee to ensure that corporate strategies are followed as agreed.

• Exempt unit trusts: These trusts may be used for investment by tax-exempt investors, such as charities and pension schemes.

Involving an independent professional trustee:

• Ensures the structure is properly managed and complies with regulations

• Provides reassurance to all participants

• Recognises and addresses external factors, such as changes in legislation and regulations

• Offers impartiality and expertise in decision-making

• Gives access to a broad, market-wide perspective on all aspects of the structure

• Is sometimes required by law

At ITL, we have extensive experience in trustee and administration services. Along with our in-house team of legal and trust practitioner experts, we can work with clients and their advisers to provide the appropriate commercial trustee services for their needs.

Please contact our team of pension trustee experts for more information.