Malta's Trusts and Trustees Act

The principal trust statute

Malta's principal trust statute is the Trusts and Trustees Act, identified as Chapter 331 in the official legislation listing. The Act's opening provision gives that short title and says its provisions apply to trustees, subject to specified exceptions for authorisation rules.^[3]

Organization and defined terms

The consolidated Act is arranged by numbered articles, with subject headings beside many articles. Its opening provisions establish the title and applicability, then define terms and describe what constitutes a trust. The text later groups provisions under the headings TRUSTS and TRUSTEES, before setting out regulatory and other provisions. The main Act is organized by numbered articles rather than numbered Parts.^[3]

Article 2 defines terms used throughout the statute. Among them, a beneficiary is a person entitled to benefit, or in whose favour a distribution discretion may be exercised. A settlor is the person who creates the trust or contributes property to it. The Act defines trust property as property held on trust and the trust instrument as the instrument creating the trust, including an instrument varying its terms.^[3]

The statute also defines the trustee by reference to a person holding property on trust terms, and provides that trust terms may be written or oral, expressed or implied. It distinguishes a Maltese trust, whose proper law is Maltese law, from a foreign trust, whose proper law is not Maltese law. These definitions supply terminology for the provisions that follow.^[3]

Article 3 describes a trust as an arrangement in which a trustee holds property under an obligation to deal with it for beneficiaries or a charitable purpose, or both. It characterizes the trust property as a separate fund held by the trustee. The trustee has power and a corresponding duty to administer, use, or dispose of that property under the trust terms and applicable legal duties.^[3]

Subjects addressed by the Act

The early provisions address applicable law and trust validity. They also cover recognition and beneficiary interests. The Act says a trust is governed by its proper law, determined under the statute, and allows trust terms to provide for a change to another jurisdiction's law. It also gives force in Malta to specified provisions of the Hague Convention on trusts and recognition.^[3]

Beneficiary provisions cover beneficial interests and eligibility. They also address discretionary distributions. A beneficiary's interest is subject to the trust terms and applicable law. The Act permits terms that identify beneficiaries by name or class, allow additions, or give trustees discretion over which beneficiaries receive property. That discretion may cover the amount, timing, or manner of distribution.^[3]

Other trust provisions address additional property and the consequences of failure. They also cover revocation and termination. Trustee provisions address appointment, acceptance, and resignation, as well as replacement. The appointment rules allow an individual of full age and legal capacity, or a legal person whose objects include acting as trustee, to hold that office.^[3]

Trustee duties and powers form a substantial subject area. The Act sets standards for the exercise of duties and discretion, directs trustees to administer trusts according to their terms, and provides for inventories when trustees accept office. It also addresses impartiality among beneficiaries, trustees' powers over trust property, and circumstances in which delegation is permitted.^[3]

The Act also provides for optional protectors, who may receive powers set out in the trust terms, including appointing or removing trustees or requiring consent before a trustee exercises discretion. Charitable trusts may provide for an enforcer charged with monitoring compliance with the trust terms and promoting the trust's purposes. Court provisions address applications for directions and orders concerning trust administration. They also cover appointments, accounts, and trustee duties.^[3]

A separate schedule reproduces the Convention provisions referenced in the Act. It includes material on scope and applicable law, as well as recognition and general clauses. This schedule supplements the Act's articles and is part of the consolidated text presented by the legislation site.^[3]

Where to find the consolidated text

The official consolidated text is on the Legislation Malta website under the Malta Laws chapters, listed as Chapter 331, Trusts and Trustees Act. The legislation record provides an ELI link ending in eli/cap/331 and offers the text in English and Maltese, with PDF listed as a format.

Key points

The Act defines a trust instrument to include an instrument varying the terms of the trust.^[3]

A person may be identifiable by name or ascertainable by reference to a class or relationship for purposes of entitlement to benefit under a trust.^[3]

Related reading

Trust types and roles under Malta law covers trust types and roles named in Malta's procedures. Malta rules for trustees and fiduciaries describes the licensing framework for trustees and fiduciaries. Malta trust taxation and U.S. reporting addresses Malta tax treatment and U.S. reporting. Malta reporting frameworks and U.S. trust forms describes reporting frameworks and information exchange.

Questions and answers

Related resources

Related glossary terms

• Trust: The Hague Convention describes a trust as a relationship in which a settlor places assets under a trustee's control for beneficiaries or a specified purpose.
• Proper law of a trust: The Jersey Trusts Law defines proper law as the jurisdiction's law expressed or implied in trust terms, or most closely connected to the trust when created.

Related articles and guides

• Mauritius Trusts Act: structure and scope: Mauritius lists the Trusts Act in its Acts A to Z directory, which is where its official consolidated text is published.
• Malta's courts and legal system: Malta's court structure, the Constitution's role and the appeal routes, with the site where Maltese legislation is published, for U.S. citizens reading its law.

Tools and official documents

• IRS form finder: Search form reference pages by keyword or number. Each result has a one-line description, and matches run across form titles and numbers, plus descriptions.

Related pages

• Malta: overview: Start page for this jurisdiction.
• Types of trusts
• Trustee regulation and licensing
• Taxation of trusts
• Reporting and information exchange