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Certainty in the Cook Islands

Cook Islands Law was designed to protect the assets of a trust settlor. Naturally, the law was intended to protect assets that have been lawfully gained. The trust laws are also designed around properly settled trusts. Whereas they can provide protection against existing litigants, it is best to set up the trust before a legal threat arises. Most offshore jurisdictions recognize foreign judgments. Some jurisdictions have created legislation that, in effect, sets aside foreign judgments. Judgments are only recognized only if issued under legislative processes. These laws are created to keep the effects of litigious societies from spilling over into local courts. The Cook Islands did just this in 1989 with their International Trust laws which prohibits the recognition and effect of foreign judgements.

The Cook Islands is not the only jurisdiction in the world to have such legal amenities for foreign capital. However it is the only jurisdiction in the world where these laws have been tried, tested and have prevailed in courts with strong plaintiffs such as the United States of America. This is the one place where International Trust Laws have been proven to protect assets for the trust beneficiaries.

Cook Islands Trustees

Trustees in the Cook Islands are regulated by the Financial Supervisory Commission and are duty-bound to protect the settlor's assets for the beneficiaries of the trust. Your trustees hold legal title to assets and investments on trust and has fiduciary duties to the beneficiaries. This means they cannot benefit from the trust, other than charging reasonable and agreed-upon service fees. Trustees are licensed and bonded and are experienced professionals. Although the trust is irrevocable, the trustee can be directed to distribute trust funds to you. Your funds are protected if you are being forced to request the funds under legal duress. If a domestic court ever orders the return of trust assets, your trustee simply ignores the order. The trustee is only allowed to distribute trust funds for the benefit of the trust beneficiaries and not that of a creditor. If you are ever unhappy with how the trustee is handling trust events, your protector can remove and reappoint another trustee at any time.

The Cook Islands Law and legal history make it a clear choice as an offshore trust jurisdictions. The trust not only works in theory to protect assets. It works in practice. Plus, the trust protector can help to affordsthe settlor with certainty of relative control of the trust assets.