STEP

Title Research

France

French law has no doctrine of trusts. Ownership attaches not to an estate in land of various durations, but to the land itself. As there is no distinction between legal and equitable estates, creating a trust under French law is impossible. However, for over 100 years, French courts have agreed to recognise the effects in France of trusts governed by the law of other countries. According to French case law, foreign trusts are recognised as such and are seen as a specific legal arrangement in their own right.

STEP France branch page

New developments

As from April 2009, a voluntary disclosure programme has been implemented by the French tax authorities for a limited period of time. French tax residents who want to regularise their situation, particularly in case of unreported offshore bank accounts, may approach the French tax authorities on a no-name basis in order to find out what the tax cost would be.

1. Introduction

a. Legal environment

French law has no doctrine of trusts. Ownership attaches not to an estate in land of various durations, but to the land itself. As there is no distinction between legal and equitable estates, creating a trust under French law is impossible. However, for over 100 years, French courts have agreed to recognise the effects in France of trusts governed by the law of other countries. According to French case law, foreign trusts are recognised as such and are seen as a specific legal arrangement in their own right.

French law does not provide for grant of probate or letters of administration. Instead, by operation of the law, the deceased’s estate vests in the heirs immediately upon the testator’s death.

As a general rule, French testators are limited in the disposition of their estate by will because they cannot disregard the reserved rights of certain heirs. The part of their estates that the testator can bestow freely is called the ‘quotité disponible’. The part reserved for specific heirs is called the ‘réserve héréditaire’. The size of the reserve varies according to the number of such heirs and their degree of relationship to the testator.

The currency of France is the euro (EUR).

Editorial board
Maryse Naudin TEP
Tirard Naudin, Paris, France
Jean-Marc Tirard TEP
Tirard Naudin, Paris, France

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