Article Title
The Rise of the International Trust
Abstract
On February 26-27, 1999, Vanderbilt University Law School and the student-edited Vanderbilt Journal of Transnational Law hosted a symposium entitled "The International Trust." The articles appearing in this issue and the next issue of the Journal are the product of that symposium. The Symposium, as well as this and the next issue of the Journal, represent an attempt to give serious consideration to a topic that to date has received relatively little serious examination.
The international trust, the subject of the Symposium, is experiencing an extraordinary reception worldwide. It is being utilized by individuals from countries with legal cultures that traditionally have not known this form of ownership. In fact, there is no formal legal construct known as the "international trust." Rather, the term as used in the Symposium and as used herein, is intended as an organizing principle to explore the various implications of trusts with international or transborder linkages. The focus is on private trusts, those utilized to manage the wealth of individuals and their families, although much of the discussion pertains as well to trusts used for business, commercial, and broad-based mutual and pension funds.
There is a great similarity between the generative conditions behind international trusts today and the conditions that gave rise to the trust in the first instance. Used as a vehicle for bypassing restrictions on clerical ownership of property in England, the trust soon evolved into an essential and commonplace means both for wealth management and its disposition within a family. The trust's tasks are both of a horizontal and vertical nature. The trust permits private regulation by the settlor and finite differentiation among beneficiaries at a particular generational level. It also permits precise, private control over the administration of wealth and its disposition among successive generations across time. The settlor can be assured that the plan will be effectuated due to the high duties imposed on the trustee, who serves as a fiduciary. This same private managerial and distributive control system that has traditionally characterized the trust remains much in demand.