1. The Civil Code of People's Republic of China (PRC) has been officially promulgated and will come into force on 202 1 1. Article 1045 of the Civil Code stipulates the scope of relatives, close relatives and family members, which has a far-reaching impact on the determination of the beneficiary scope of domestic family trusts.
Secondly, how to determine the scope of beneficiaries in the practice of domestic family trust.
Although CBRC Document No.37 is a normative document in the CBRC, and its effectiveness level is lower than that of laws, administrative regulations and departmental rules, it is the first official definition of domestic family trust recognized by the industry, which is essentially the main basis for the development of domestic family trust business at present.
Trust company's idea: but the document does not define what family members are. In practice, the main idea of trust companies in determining the scope of beneficiaries is to help identify what is the real protection and inheritance of wealth, and to prevent the improper transfer of interests between the client and the beneficiary through the beneficiary setting. If the beneficiary is not a family member of the principal, such as the beneficiary is its business partner, the trust company has very limited means and ability to identify whether there is improper interest transfer between the principal and the beneficiary.
Third, therefore, the scope of beneficiaries in practice includes the following categories, in descending order accepted by the trust company: the principal, the spouse of the principal, the parents of the principal's spouse, the children born or adopted by the principal and his spouse, and the grandchildren of the principal and his spouse, that is, the legal heirs in the first order basically add grandchildren. Grandchildren who have their own children during the trust period are also included in the scope of beneficiaries. The people in this paper are the beneficiaries with the highest acceptance, because if we want to define the real inheritance of family wealth, we must look at who the client is most willing to pass the assets to according to ethics and humanity.
Fourthly, if it involves the second-order legal heirs of the client's brothers and sisters or their spouses, brothers and sisters' spouses, brothers and sisters' children, the client generally needs to explain what special circumstances the family has, what special considerations the client has, and the benefit distribution mechanism, distribution conditions and payment path of such beneficiaries, so as to judge the rationality. For example, customers have many brothers and sisters, and only customers succeed in their own careers. The tradition left by the parents is family unity and mutual care. Therefore, the client set up a family trust as a family education fund, and the descendants of the client and his spouse's brothers and sisters can receive education bonuses.