Countries that want to magnetize such companies-family offices-in order to choose to place their headquarters in their territories, should create an attractive operating framework for the development of this industry, thereby creating a new service industry.
What are Family Offices
Family Offices are an independent, privately held investment firms, who must adopt their clients’ goals as their own. Their portfolios are constructed based on solid investment principles, informed by deep experience in the management of private wealth and designed to outperform.
by Trust Economics-https://trusteconomics.eu
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Family Offices are special purpose companies that operate for the sole purpose of managing wealthy families’ property. Worldwide there are about 14000-15000 family offices. They used to provide in the community of wealthy families:
- Unbiased advice from a firm that has no proprietary products or business agendas that might compete with their clients’ interests.
- Deep client partnerships that enable truly customized service and one-of-a-kind portfolios.
- Access to global investment ideas through a well-established global platform of manager relationships.
- With their experience helping families of substantial wealth realize their long-term investment goals and fulfill their legacies.
The Services of the Family Offices
- Accountability & Audit
- Administration of Family Businesses
- Bill Payment Services
- Cash management
- Business Performance Reporting
- Coordination of Professionals
- Document Management & Record Keeping
- Estate Planning
- Family Business Advisory
- Family Governance & Family Meetings
- Foundation Management
- In-House Legal Council
- Investment Strategy & Global Asset Allocation
- Investment Management Selection & Monitoring
- Life Insurance Management
- Personal Financial Statements
- Philanthropy
- Portfolio Management
- Real Estate Management
- Risk Management & Asset Protection
- Retirement Planning
- Tax Services
- Trustee Services
Five steps towards an attractive framework for Family Offices
A. Creating a broad concept of what is defined as a ‘family’
The usual structure of a Family office should serve not only parents and children but wealthy families that can be a first-generation wealth creator, a family trustee, a business owner, or a five-generation family member continuing family legacies.
B. Acceptance of the concept of “Family with international profile and high mobility”
Family offices must serve families whose members reside in different territories. It should therefore not affect the functioning of family offices if the family’s tax residence is different from the family office tax office.
C. Multi-Family Offices
Family Offices should serve more wealthy families at the same time. Their clientele should include families of five generations (e.g., parents, grandchildren, children, great-grandchildren, tri-parents). In this way, the wider the activity of a Family Office, the greater the amount of operating costs it will be able to bear.
D. Definition of the term ‘Minimum Expenditure’
For Family Offices to be more competitive, the minimum annual family office spending amount must start at $250,000 per year.
E. Tax Insurance
It should be made clear that the activities of the Family Office will not be the administration of the foreign companies of the client family, which would otherwise create a tax domino for their total property. That applies to Fund Management companies that manage foreign funds should also apply to Family Offices.
