Establishment (Anstalt) Law
Until it was outpaced by the foundation, the Liechtenstein "Anstalt" (Establishment) was for a long time the country’s most popular legal entity. The special feature of the Liechtenstein Establishment is that it involves a halfway house between foundation and corporate body. The Establishment may or may not comprise members – depending on its articles of incorporation.
The common form of Establishment in Liechtenstein is an entity with founder’s rights. This type of Establishment has no members and its capital is not divided into shares. Instead, its articles of incorporation provide for one or more founders who constitute the highest governing body and, as such, are accorded comprehensive powers. As long as no beneficiaries are appointed in the case of an Establishment with founder’s rights, the economic owner of the founder’s rights is legally assumed to be the beneficiary of the Establishment.
As a consequence, these rights entitle the founder to be a member of the board of directors as well as to make decisions regarding the financial assets. Liechtenstein Establishments are frequently set up by local trust companies acting as nominees for their clients. Thus the real (economic) founder usually remains anonymous to the outside world. The rights of an Establishment’s beneficiaries are stated in the by-laws (“Beistatuten”), which do not have to be filed with the commercial register. Unlike the rights of foundation founders, those of Establishment founders are assignable and heritable. When its economic founder dies, many Liechtenstein Establishments actually become Establishments with no founder’s rights, where the beneficiaries then occupy a similar legal position to that of foundation beneficiaries.
An Establishment can be used to fulfil an economic or non-economic purpose. In order to acquire the rights associated with a legal personality, an Establishment must be entered in the Liechtenstein commercial register. The minimum capital required is CHF 30,000.
Attorney-at-law Harald Bösch has dealt with complex issues of Liechtenstein’s Establishment law in various publications and legal opinions. In his examinations of fiduciary law, he has subjected the legal relationship between economic founder (foreign client) and fiduciary founder (Liechtenstein fiduciary) to a fundamental reappraisal, which has subsequently been adopted in judicial practice.
Harald Bösch counsels and represents clients in all matters related to Liechtenstein’s Establishment law.