A9 Beneficiaries of the Liechtenstein Private Benefit Foundation
In principle, the beneficiaries have their own right to information, disclosure and control vis-à-vis the foundation and can enforce these rights in court.
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Under Liechtenstein foundation law, a beneficiary is deemed to be the natural or legal person who at any time during the legal existence of the foundation or upon its termination enjoys or may enjoy an economic benefit from the foundation. The term beneficiary includes the beneficiaries, the prospective beneficiaries, the discretionary beneficiaries and the ultimate beneficiaries. They are not of equal rank. As a rule, the beneficiaries are individualised in the by-laws.
The legal status of beneficiary is in principle of a highly personal nature and is not transferable or inheritable – unless the founder expressly orders the contrary.
The beneficiaries of a foundation are not only its economic beneficiaries, but have further rights and functions within the legally prescribed foundation governance framework:
If the foundation is subject to foundation supervision or if the foundation is designed to be revocable and the founder is the ultimate beneficiary, the beneficiaries have no information rights.
If the foundation has an independent controlling body, the beneficiaries‘ rights to information are limited. However, they receive the annual control report of the appointed control body.
If the foundation is neither voluntarily subject to foundation supervision nor does it have an independent supervisory body, the beneficiary has comprehensive information rights:
- Right to information / reporting
- rights to inspect all books of account and
- comprehensive auditing rights, in particular of the accounting system
The beneficiary may enforce his rights in the ordinary courts.
Foundation beneficiaries in DE, CH. AT
DE/CH/AT: In all three jurisdictions, the founder can grant the beneficiaries an actionable claim to the foundation benefit. The beneficiaries can claim damages directly against the foundation.
EN: The founder cannot be a beneficiary at the same time. The beneficiary has a general right to information, but no rights of participation or control. Beneficiaries have only limited rights vis-à-vis the supervisory authority.
CH: Pure family foundations are not possible in Switzerland. Anyone with a legitimate interest can lodge a complaint with the foundation supervisory authority.
AT: Only the Austrian private foundation has the provision of a distribution block. The founder can appoint himself as beneficiary. Beneficiaries have little possibility to participate. Beneficiaries with a legal interest have application rights to the court. The position as beneficiary is fungible and alienable in Austria.