"In Fiducie we trust !"
As an outstanding legal management and guarantee instrument, the fiducie is now a key driver for optimizing both professional and personal assets.
Created in 2015, Fidal Fiducie, a law firm dedicated to fiduciary activities and those of security trustee, is guiding companies, financial institutions, associations, local authorities and individuals throughout France in protecting and enhancing the value of their assets. Drawing on the legal and tax expertise of Fidal's lawyers, Fidal Fiducie offers its clients an original and innovative value chain: fiduciary activity/fiduciary advice that provides strategic and global guidance which is unique in the market.
Although there are numerous applications for the fiduciein all areas of law, Fidal Fiducie and Fidal are particularly recognized for their expertise in wealth management and family matters. Our complementary teams also enable us to offer our clients innovative ways to make use of the fiducie, in particular in managing and securing full value for intangible assets.
Fidal Fiducie is authorized by the Paris Bar Association to act as fiduciary and security trustee.
What is a fiducie?
The fiducie, often referred to as a "French-style trust", is a transaction by which a settlor transfers property, rights or sureties, present or future, to a trustee who keeps them separate from its own assets and acts for a specific purpose for the benefit of a beneficiary, who may be the settlor itself. It involves a temporary transfer of ownership of property, with a compensatory entry, that is ring-fenced in the hands of the trustee.
The fiducie can be used as a surety (property is transferred to the trustee to secure the performance of an obligation) and as a management tool (property is transferred to the trustee who is responsible for managing or even selling it over a certain period).
What is a Security Trustee?
Since 1 October 2017, a group of creditors such as a banking pool or a bondholders' group may designate the person of their own choosing as security trustee, who will act on their behalf but in its own name.
Its duties will consist in accepting, registering, managing and, where applicable, selling any personal (surety bond, independent first demand guarantee, letter of intent) or real (mortgage, lien, pledge, trust) surety on the property of the debtor or third parties to guarantee the claim of this group of creditors.
These sureties, as well as the proceeds of their possible disposal, will enter into special-purpose assets that the security trustee will keep separate from its own assets and which will thus be ring-fenced for the benefit of the group of creditors, while remaining sheltered from the consequences of collective proceedings initiated by the debtor or the third-party grantor.
A fiducie can be effectively set up on the basis of corporate securities:
- To guarantee the enforcement of a shareholders' agreement, each signatory transferring its shares to a trustee tasked with scrupulously respecting the voting and/or sales clauses contained in the said agreement.
- To provide a balance-sheet guarantee or a price adjustment clause as part of transfer of control, under more secure conditions than a traditional escrow account measure would do
- To resolve a conflict between partners and organize the early exit of the withdrawer, without damaging his or her financial interests
- To process a provisional capital outflow with a view to temporary deconsolidation
- To ring-fence equity interests and protect them from prying eyes
- To stand in for a holding company
- To facilitate an exit from a safeguard plan or receivership through a court-authorized transfer of control
- To secure a donation of company securities, with a temporary irrevocability clause signed up to by the pledging donee.
The fiducie is a tremendous tool at the service of family and asset management, particularly in the context of keeping the shareholders of a family-owned company secure, managing the assets of vulnerable persons or young adults, preventing the settlor's future dependency, controlling donated assets, and in the context of divorce proceedings, managing assets or settling an estate.
Real estate law
A substitute for send and lease-back, thereby avoiding the taxation of capital gains when transferring and returning the property in question.
To ensure the proper execution of a clean-up plan
To guarantee the proper implementation of an employment protection plan but also to secure company transfers, secure the payment of pensions, the payment of contractual severance pay, etc.
The fiducie can be a very effective tool for companies in difficulty, whether in the case of amicable settlement procedures, safeguard, receivership or court-ordered liquidation.