Article 2.6.11 Trusts and Foundations

(a) Purpose:

This Article establishes a framework for the lawful recognition and governance of trusts and foundations within the ICT, enabling flexible fiduciary structuring for philanthropic, commercial, or personal purposes. It aims to provide legal certainty, protect beneficiaries, and encourage use of fiduciary vehicles in a manner consistent with digital governance and minimal regulatory burden.

(b) Recognition:

The ICT recognises the legal validity of express, charitable, and discretionary trusts, as well as statutory or civil law-style foundations. These structures may be used for a variety of lawful purposes including philanthropic activities, asset protection, estate planning, commercial structuring, or mission-based operations. Recognition of foreign trusts or foundations shall not confer legal personality within the ICT unless they are newly established and registered under this ICT Code. However, such structures may be acknowledged for limited purposes such as ownership registration, disclosure, or enforcement, subject to ICT standards and Registrar guidelines.

(c) Foundations:

(i) Foundations may be established as either memberless or member-based entities. They may serve purposes including but not limited to:

(ii) Public benefit or philanthropic initiatives;

(iii) Perpetual asset protection or fiduciary administration;

(iv) Family or estate planning arrangements;

(v) Ownership of commercial enterprises or hybrid entities.

(vi) A foundation shall have legal personality distinct from its founder(s), and its assets shall be ring-fenced from those of any founder, contributor, or beneficiary, except as expressly provided by law or the foundation’s governing instrument.

(vii) Foundations shall be governed by a constitutional instrument and registered with the ICT Registrar.

(a) Trust Formation and Validity:

(i) A trust shall be recognised where:

(ii) There is certainty of intention, subject matter, and object;

(iii) A settlor transfers assets to a trustee with lawful purpose;

(iv) The trust is evidenced in writing or digital form in accordance with ICT standards; and

(v) The trust is not contrary to ICT law, public policy, or international obligations.

(vi) The traditional common law rule against perpetuities shall not apply to trusts established within the ICT where the trustee maintains an express or implied power of sale over trust property.

(vii) A trust may be revocable or irrevocable, fixed or discretionary, and may include protective or spendthrift clauses.

(viii) A trust may be decanted where the Operator has provided regulations for such purpose and the decanting will further the purpose of the trust.

(e) Fiduciary Obligations:

(ix) Trustees, administrators and foundation council members (as applicable) shall be subject to fiduciary duties including:

(x) Duty of loyalty and good faith;

(xi) Duty to act within the scope of their powers and the purposes of the trust or foundation;

(xii) Duty of prudence and care, including in asset management;

(xiii) Duty to account and maintain proper records.

(xiv) These duties shall not be excluded by contract, foundational document or other governing instrument, save to the extent permitted by this ICT Code. The Operator or the Companies Registrar (as applicable) or ICT Court may disqualify a fiduciary from serving in any ICT trust or foundation where there is proven misconduct, repeated non-compliance, or breach of fiduciary duties.

(b) Regulatory Oversight:

(i) The Operator, or where relevant in a specific proceeding, the ICT Court, may supervise trustees and foundation officers where:

(ii) There is an allegation of breach of fiduciary duty or fraud;

(iii) Removal or substitution of a fiduciary is necessary to protect beneficiaries or assets;

(iv) Approval of a variation, resettlement, or termination is required in the public interest;

(v) Disputes arise concerning the interpretation or administration of the structure.

(vi) Proceedings may be initiated by a fiduciary, beneficiary, regulator, or other party with legal standing. The Operator or Companies Registrar (as applicable) may deploy automated supervision tools or risk triggers for digital fiduciary structures, including transaction monitoring, audit flagging, and threshold-based alerts.

(c) Digital Registration and Governance:

All trusts and foundations operating within the ICT shall be digitally registered through the ICT City App or ICT digital equivalent interface established by the Operator, Companies Registrar or other Operator established body. This registration shall:

(i) Be machine-readable and include details of fiduciaries and governing instruments;

(ii) Identify whether the structure is private, charitable, or commercial;

(iii) Allow secure access by authorised parties, including courts and auditors;

(iv) Provide for tamper-evident records and audit trails in accordance with ICT digital law;

(v) Record beneficial ownership information in accordance with ICT transparency and disclosure provisions, accessible by authorised regulators or courts for enforcement or compliance purposes.