It is a legal arrangement where one person (the
trustee) holds and manages assets on behalf of another person (the beneficiary)
for a specific purpose. Trusts can be established for a variety of reasons,
such as to protect assets, provide for family members, or support charitable
causes.Under Philippine law, trusts are governed by the Civil Code
and are generally created by a written agreement between the settlor (the
person who establishes the trust) and the trustee. The agreement outlines the
terms and conditions of the trust, such as the purpose of the trust, the assets
that will be held in trust, and the rights and duties of the trustee and
There are different types of trusts that can be established
in the Philippines, including:
These trusts are established during the
lifetime of the settlor and are typically used for estate planning purposes.
These trusts are established through a
person's will and take effect upon their death.
These trusts are established for
charitable purposes, such as to support educational institutions, religious
organizations, or other non-profit entities.
The trustee of a Philippine trust is responsible for
managing the trust assets in accordance with the terms of the trust agreement
and for fulfilling their fiduciary duties to the beneficiary. The beneficiary,
in turn, is entitled to receive the benefits of the trust, such as income or
principal distributions, as specified in the trust agreement.
Philippine trusts can be a useful tool for estate planning
and asset protection, but it is important to seek the advice of a qualified
lawyer to ensure that the trust is properly established and to understand the
legal implications of creating a trust.
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