Labuan Offshores Trusts Act 1996 · Updated to 1 Dec 2011 · Part II · Creation and Recognition of Labuan Trusts
11E. Spendthrift or protective trust
Official textFrom Laws of Malaysia Online, unchanged
The terms of a trust may make the interest of a beneficiary in the trust property or in any income or capital of such property—
trust
―trust‖ includes the trust property and the rights, powers, duties, interests, relationships and obligations under a trust;
liable to termination;
subject to a restriction on alienation or disposal; or
subject to diminution or termination in the event of the beneficiary becoming insolvent or any of his property becoming liable to seizure or to sequestration for the benefit of his creditors.
A trust under which the interest of a beneficiary is subject to termination, restriction or diminution under subsection (1) is a spendthrift or protective trust.
beneficiary
―beneficiary‖ means a person entitled to benefit under a trust or in whose favour a discretion to distribute property held in trust may be exercised;
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A provision in the terms of a trust requiring the interest of a beneficiary in the trust property or in any income or capital of such property to be held upon a spendthrift or protective trust shall be construed as a requirement that the interest of the beneficiary be subjected to termination, restriction or diminution as mentioned in subsection (1).
trust property
―trust property‖ means the property for the time being held on trust;
Terms defined in this Act
beneficiary
Defined · s 2―beneficiary‖ means a person entitled to benefit under a trust or in whose favour a discretion to distribute property held in trust may be exercised;
disposal
Defined · s 46B―disposal‖, in relation to designated shares, includes— (a) the exercise of voting powers leading, or capable of leading, to the liquidation of the company or the cancellation of the shares or of any rights attached to them; and (b) the creation of any legal or equitable interest in the shares;
property
Defined · s 2―property‖ includes— (a) property of every kind, whether corporeal or incorporeal, movable or immovable, tangible or intangible, however acquired; or (b) legal documents or instruments in any form, including electronic or digital, evidencing title to or interest in, such property, including bank cheques, money orders, shares, securities, bonds, bank drafts and letters of credit;
trust
Defined · s 2―trust‖ includes the trust property and the rights, powers, duties, interests, relationships and obligations under a trust;
trust property
Defined · s 2―trust property‖ means the property for the time being held on trust;
Part III
Beneficiaries of Labuan Trusts
Part IV
Trustees of Labuan Trusts
Part V