Legacy, registered under the Hong Kong Trust Ordinance, benefits from a range of investment permissions and exemptions that are not available to fiduciaries.
The company has leveraged the region’s Occupational Retirement Scheme (ORS) laws and its status within China’s financial centre to create several new business opportunities for its financial adviser partners.
Occupational retirement schemes
“Among the company’s offerings are Hong Kong-registered and globally recognised Occupational Retirement Schemes (ORS),” Feifa chief executive Paul Stanfield explained.
“These schemes provide revenue authority approved benefits that are no longer available to trusts or through direct investment into insurance policies or securities accounts – even when using offshore corporate entities.
“Given the increasing hostility of governments towards offshore (as well as enveloped) investment, it is no wonder that insurance companies and other financial institutions are waking up to the potential of ORS."
“This partnership is therefore potentially very relevant to many of our member firms and their clients, and highly complementary to our existing affiliations,” Standfield said.
ORS potential
Legacy’s relationship with Feifa will be headed up by industry veteran David Traill.
“ORS provide 100% creditor protection, qualify as non-reporting ‘excluded accounts’ under [common reporting standards (CRS)] and [the US’s foreign account tax compliance act (Fatca)] and facilitate multi-generational estate planning,” Traill explained.
“They also qualify for [capital gains tax (CGT)]-free disposal of UK and US real estate and treaty approved income tax freedom at distribution for the residents of 27 countries – including the UK and a number of other European countries – as well as delivering freedom from inheritance tax.
“Given the increasing hostility of governments towards offshore (as well as enveloped) investment, it is no wonder that insurance companies and other financial institutions are waking up to the potential of ORS, and it is our task to give advisers direct access to our ORS so that they can provide enhanced solutions within a multi-trillion US dollar market.
“However, and no matter what opportunity we create for advisors, we recognise that product by itself isn’t everything, so the company also provides thorough onsite training, shares its fees, and is committed to educating approved adviser channels through the provision of high quality and ongoing technical support. We see our new relationship with Feifa as central to our ability to do this in Europe,” Traill said.
Feifa member companies are English-speaking advisory businesses, active across Europe and advising on cumulative assets in excess of €4bn (£3.17bn, $4.5bn). The federation is a non-profit trade association and has partnerships with a wide range of companies, including all of the relevant international life companies and the major asset managers.
