Who Owns the Private Trust Company? Singapore’s PTC Ownership Options Without a Local Purpose Trust

Families setting up a private trust company (PTC) in Singapore to hold and administer wealth across generations quickly run into a question that is rarely discussed until it matters: who actually owns the shares of the PTC itself? In offshore centres such as the British Virgin Islands, the Cayman Islands, Jersey and Guernsey, the standard answer is a non-charitable purpose trust, sometimes called an “orphan structure”, which holds the PTC’s shares for a stated purpose rather than for named beneficiaries. Singapore does not have that option, and families who assume it does can find themselves redesigning their structure midway through onboarding.

This article sets out why Singapore currently has no local purpose trust regime, what families and their advisers use instead to hold PTC shares here, and the governance questions worth resolving before the structure is put in place.

Why There Is No Singapore Purpose Trust (Yet)

Under Singapore trust law, a valid private trust generally requires ascertainable beneficiaries who can enforce the trustee’s duties. A trust for a purpose, rather than for people, is not currently recognised as valid under the Trustees Act 1967 in the way it is in BVI, Cayman or Jersey, each of which enacted specific non-charitable purpose trust legislation decades ago. The Singapore Academy of Law’s Law Reform Committee published a report in 2021 recommending that Singapore consider enacting statutory non-charitable purpose trusts, precisely because the absence of one is seen as a competitive gap against those offshore centres for orphan-structure planning. As at the time of writing, that recommendation has not been enacted into law, so any purported non-charitable purpose trust governed by Singapore law would risk being held void.

This is an important point to get right before instructing anyone to draft documents: assuming Singapore has a workable local purpose trust regime, and then discovering during onboarding that it does not, is one of the more common and entirely avoidable planning mistakes we see in family office structuring conversations.

What Families Use Instead

Option 1: A Foreign Purpose Trust Holding the Singapore PTC

The most common workaround is to keep the “orphan” ownership layer offshore. A BVI or Cayman non-charitable purpose trust, administered by a licensed offshore trustee, holds the shares of the Singapore PTC, while the PTC itself is incorporated and licensed (or exempted) in Singapore to act as trustee of the family’s actual trusts holding the operating assets. This keeps the governance benefit of an orphan structure (no natural person or family branch “owns” the PTC in the ordinary sense) while relying on a jurisdiction that has the enabling legislation Singapore currently lacks.

Option 2: Direct Family Ownership With a Robust Constitution

Many Singapore PTCs are simply owned directly by family members or a family holding vehicle, with the governance protections built into the PTC’s own constitution and a shareholders’ agreement rather than into the ownership layer itself. This is often paired with a carefully drafted board resolution framework that entrenches how PTC directors are appointed and removed, so that no single family branch can unilaterally change control of the trustee even though someone technically owns the shares.

Option 3: A Licensed Trust Company or Foundation as Shareholder

Some families instead use a licensed trust company, or a foreign private foundation (a civil law equivalent that does not face the same beneficiary-certainty requirement as a common law trust), to hold the PTC’s shares. This is a heavier and more expensive structure, generally reserved for very large or highly complex multi-branch families where the governance stakes justify the additional layer.

Licensing Context: The Trust Companies Act

Whichever ownership route is chosen, the PTC itself will usually rely on the exemption available under the Trust Companies Act 2005 for trust companies that act only for a single family group, rather than holding a full trust business licence from the Monetary Authority of Singapore. This exemption is what makes the PTC model commercially viable for family offices in the first place, and it sits alongside the broader 13O and 13U tax incentive framework that most Singapore single family offices are built around.

Because a Variable Capital Company is frequently the vehicle chosen to hold the family’s actual investment assets underneath the trust structure, families weighing up a PTC often read this alongside our companion piece comparing a VCC to a Cayman SPC as a fund domicile, since the same onshore-versus-offshore trade-off runs through both decisions.

Governance Questions to Resolve Before Incorporation

Before a Singapore PTC is incorporated, families should be clear on who has the power to appoint and remove PTC directors, and whether that power sits with a protector, a family council, or a specific family branch. They should decide how deadlock between directors representing different branches will be resolved, since a PTC with no natural shareholder oversight can otherwise become difficult to unwind if relationships sour. They should also confirm, in writing, which family members are “controllers” for the purposes of Singapore’s beneficial ownership disclosure requirements, since a PTC’s own Register of Registrable Controllers obligations do not disappear simply because the ownership structure is unusual.

Given how closely PTC governance interacts with succession and estate planning more broadly, families should also think about their wider financial planning and investment structuring at the same time as the PTC design, rather than treating the trustee entity as a standalone project disconnected from the rest of the family’s holdings.

Comparing the Options at a Glance

None of these is inherently “better” in the abstract. The right choice depends on how many family branches are involved, how much the family is willing to spend on the ownership layer itself, and whether the family already has an existing offshore trust relationship that a purpose trust could sit alongside.

Succession Planning Implications

Whichever ownership model is chosen, families should think through what happens on the death or incapacity of a key family member who currently controls the PTC’s shares or its board appointment rights. Direct family ownership without a clear succession mechanism in the constitution can leave a PTC’s shares passing through a deceased shareholder’s own estate, which may trigger exactly the kind of probate delay and cross-border complexity the family office structure was meant to avoid in the first place. Building a clear, documented succession plan for control of the PTC, separate from the succession plan for the underlying family wealth, is one of the most commonly overlooked steps in Singapore family office structuring.

Families should also periodically revisit the structure as circumstances change, since a PTC ownership arrangement that made sense for a first generation founder may need to be revisited once a second generation, potentially spread across several jurisdictions, starts taking on governance roles.

Watching the Legislative Space

Given that the Law Reform Committee’s 2021 report recommended Singapore enact non-charitable purpose trust legislation, families currently relying on a foreign purpose trust or an alternative structure should keep an eye on whether Singapore eventually follows through. If a local regime is introduced, existing structures may be worth revisiting, though families should not delay a current structuring decision purely in anticipation of legislation that has not yet been tabled.

Getting the Structure Right the First Time

Because the absence of a Singapore purpose trust regime is not always obvious to families coming from BVI or Cayman-style advice, it is worth confirming the current legislative position, and the practical alternative chosen, before any incorporation documents are signed. If your family office structure touches on cross-border elements, it is also sensible to seek legal advice on how the ownership layer will be treated across jurisdictions before committing to one approach over another.

To speak with the team at Raffles Corporate Services, you can email [email protected] or call, SMS, or WhatsApp +65 8501 7133. We are happy to assist with any queries.

The Editorial Team, Raffles Corporate Services