Trusts & Trustees article on French Constitutional Court decision
Christophe Jolk examines a French Constitutional Court decision for Trusts & Trustees in a public registry – related case.
A female American citizen and tax resident of France asked the French State Council to suspend the execution of Decree number 2016-567 of 10 May 2016, relating to the public trust registry.
The claimant alleges that Article 1649 AB of the French tax code “disproportionately violated her right to privacy”. The violation happened as a consequence of certain private information in the registry being made public. Publicising the identity of the beneficiaries of the trusts she had set up would have revealed the way of organising the distribution of her assets after her death.
The French State Council submitted the priority constitutional question (QPC) to the French Constitutional Court, as requested by the claimant. Christophe shows that the French Constitutional Court only analysed the argument of the violation of privacy but not the other legal arguments presented.
“The French Constitutional Court noted that Article 1649 AB of the French tax code requires the gathering in a public registry of the names of the settlor, trustee and beneficiaries, as well as the date of creation of the trust”, Christophe says.
Finally, as stated within the article, “[t]he Constitutional Court in the present decision concluded that a public registry giving Access to the names of the settlor, the trustee and the beneficiaries of a trust, gives information as to how one intends to structure his assets. This constitutes a violation of one’s privacy”.
Importantly, the French Constitutional Court did not consider the public trust registry unconstitutional per se. Moreover, it accepted the State’s argument that the registry needs to tackle tax fraud and money laundering.
The article is available to read here.
Barristers: Christophe Jolk