##The Bahamas: An Ideal Location##

With the globalization of families and their businesses it is often convenient for the Family Office, business headquarters, as well as the legal holding structure, to be located in a jurisdiction that provides a suite of products that can meet the diverse needs of multiple family members. The Bahamas has experienced 280 years of uninterrupted parliamentary democracy. The judiciary is independent and upholds respect for property rights and the rule of law. As such, it is an ideal jurisdiction for private wealth management activities.

The Bahamas is an ideal platform for family offices either as a stand-alone or as a branch of a family office already established in another jurisdiction. Family offices increasingly are becoming institutionalized with a significant focus on effective risk management, performance measurement and an emphasis on governance and purpose.

The Bahamas provides a financial infrastructure without comparison which can support the family office giving it access to institutional asset management options and first class service providers including private banking which has traditionally been the bedrock of product offerings, funds, trust and corporate services. Creating an environment where family offices can operate efficiently has been designated as a key growth area for The Bahamas as families and their advisors have begun to recognize that there is flexibility in the “size” of the family office footprint in The Bahamas. They can choose to build their family offices around one or any number of structures or licences which provide a true and regulated presence in The Bahamas including:

* Private Trusts Companies;
* Financial and Corporate Service Providers Licence;
* Securities Advisor and Management Licences;
* Bank and/or Trust Licence;

##The Bahamas Advantage##

The Bahamas offers a number of key advantages for the establishment of a Family Office.

**Strategic Location:**
The Bahamas is situated at the Crossroads of the Americas, just 65 miles off the east coast of Florida. An ideal hub for regional investment and business in the Eastern United States and Canada, and much of Central and South America, it is in the same time zone as New York, Miami and Toronto, so office hours align with most of the major business centres in the Americas.

The Bahamas has developed land, suitable premises and fit-for-purpose infrastructure with the singular focus of facilitating international business. Moreover, The Bahamas is easy to get to, with six major airports and 49 other airports situated throughout the archipelago, as well as countless ports of entry and marinas that can accommodate the largest yachts.

**Skilled Workforce:**
The Bahamas has a highly educated local workforce and a long tenure in financial services excellence which has created a deep pool of skill and experience that is recognized and trusted worldwide. With more than 6000 experienced financial professionals committed to the local community, clients can expect to build deeper and more lasting relationships and receive more consistent service in The Bahamas than in locations largely dependent upon imported skills.

The Bahamas encourages the growth of its financial sector through adherence to internationally accepted regulatory principles, and efficiency in their administration. Regulatory independence is maintained through the separation of roles of policy makers and regulators.

The Bahamas has an outstanding record of political and economic stability, progress and stewardship. An independent nation since 1973, The Bahamas is a politically stable, democratic and sovereign nation.

The Bahamas is located in one of the most idyllic tropical settings in the world and has many attractive features for those who may wish to relocate permanently or establish a second home. To meet the diverse and sophisticated tastes of travelers and residents alike, The Bahamas offers something to suit every taste: rest and relaxation, family fun and entertainment, or adventure and exploration. With miles of natural sand beaches, out-door attractions, luxury resorts, golf, casinos, restaurants and shopping, there is no shortage of exciting things to do.

##Bahamian Solutions for Family Office##

The Bahamas offers owners of capital a broad choice of financial institutions that deliver a myriad of services including banking, private banking and trust services, investment fund administration, capital markets, investment advisory services, accounting and legal services, e-commerce, insurance and corporate and shipping registries. The Bahamas is a favourable jurisdiction for the establishment of family offices, which help wealthy families achieve their goals while dealing with increased regulations, and complex issues of taxation, distribution planning and charitable giving. Ultimately we have found that family owned Trusts, Foundations and Private Trust Companies (PTC’s) – cornerstones of wealth and asset management services in the Bahamas –form the legal backbone of these systems and many families have set up Family Offices to support and assist the families in the running of their affairs.


Trust legislation in The Bahamas is robust and in many cases precedent-setting, providing family offices with the benefits of asset protection, control, succession planning and confidentiality including:

**Asset protection:**
The Fraudulent Dispositions Act ensures disposition can only be set aside at the instance of a creditor (actual or contingent) with actual knowledge and that transfer is set aside only to the extent necessary to satisfy the particular claim. While the **Trustee Act (1998)** contains Anti Forced Heirship Provisions; and the **Trusts Choice of Governing Law Act, 1989** states that *“A settlor, whether or not he is resident in The Bahamas, may expressly declare in the trust instrument that the laws of The Bahamas shall be the governing law of the trust”.*

The **Trustee Amendment Act, 2011- Directed Trust Provisions** gives settlors certainty as to effectiveness of power to direct the trustee, thus allowing investment management decisions to be undertaken by those most suitably qualified to do so.

**Succession Planning:**
The **Trustee Amendment Act, 2011** incorporates Hostile Beneficiary Clauses, ensuring that the wishes of the settlor to have a long term structure are not defeated by an erratic or unstable beneficiary.

Under**the Trustee Act** there is no public register of trusts or trust documents and Disclosure is limited to beneficiaries that do not have a vested interest.


In an effort to meet the requirements of an increasingly sophisticated financial services marketplace, The Bahamas enacted Foundations legislation in 2004, as an option for an effective estate plan where a trust is not a preferred vehicle.

Like a trust, a foundation, provides benefits and protections that are important to a family office. It certainly can be called the “hybrid vehicle” of the estate planning world in that it is a unique mix between a trust and a company, since it has several aspects in common in with one or the other.

For example:

* Like a company, a foundation is a distinct legal entity that enjoys limited liability
* Like a trust, a foundation has beneficiaries
* Like a company, a foundation must be registered and have a registered office
* Like a trust, a foundation may be used to avoid forced heirship in other jurisdictions
* Like a company, a foundation may have a council appointed by the founders to act in their interests.


The first of its kind, the Bahamas Executive Entity (BEE), was designed to fill governance roles within wealth structures. The BEE has no shareholders or beneficiaries because its purpose is not purely to hold assets but to perform “administrative functions” of an executive , administrative, supervisory, fiduciary or office holding nature. As a streamlined entity the BEE allows “corporate governance” style provisions to be truly integrated into the structure.


A private trust company (PTC) is usually a limited liability company formed for the express purpose of acting as a trustee of a specific trust, or group of trusts for members of a family. Its Board of Directors is usually comprised of the patriarch of the family and other family member, allowing the family to retain control over the strategic management of underlying assets, thus enabling a family to retain control without prejudicing the validity of the trust. A PTC offers a long term approach to governance of family wealth with the possibility of the next generation of family members to be included on the Board of the PTC at an appropriate time.

##Asset Management##

Much of the growth in Bahamian funds has primarily come from family offices but increasingly large institutional investors are starting to look at The Bahamas, demonstrating the solid framework in place to support larger funds and with that, larger institutional investors. The legal regime governing funds is efficient, innovative and flexible.

The Investment Funds Act in The Bahamas is highly robust and currently supports four classes of funds: Standard Funds, Professional Funds, Recognised Foreign Funds and SMART Funds. The Professional Fund is aimed at institutional and sophisticated investors and can be licensed by an Unrestricted Administrator, or directly by the Securities Commission. The benefit of availing of the former choice is that it enables fund managers to get their product(s) to market speedily and efficiently.

##The Bahamas Advantage for the Family Office##

The most widely used and accepted definition for the Family Office is *“A vehicle that performs a wide array of functions and services for the family it represents from the provision of staff and travel management services through to the supervision of trusts and personal investments that fall outside of the family’s core operating business interests”.*

It is in this context that it should come as no surprise that The Bahamas with its strong private banking legacy, well respected trust and company legislation, its financial services infrastructure (advisory and regulatory) and its communications and transport links, has become an increasingly attractive centre for the establishment of a family office.