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On Friday, May 29, 2009, the Bermuda Parliament passed the Perpetuities and Accumulations Act 2009, which repeals the rule against perpetuities for Bermuda law trusts, save in respect of Bermuda real estate, in a move which will increase Bermuda’s attractiveness to wealthy families looking to establish trusts in offshore jurisdictions.
Bermuda law trusts established after 1 August 2009 will no longer be required to limit their duration to 100 years, whether they are trusts for beneficiaries or for charitable or non-charitable purposes. Trusts already in existence on that date will be able to apply to the Bermuda court for an extension of their trust period.
Edward Stone of Conyers Dill & Pearman commented: “Coupled with Bermuda’s excellent reputation as a leading offshore trust jurisdiction, the flexibility now offered by the removal of the perpetuity period for all trusts further enhances the attractiveness of Bermuda as jurisdiction of choice for wealthy families. Increasingly, clients are looking to trusts as part of their long term wealth preservation strategy rather than for any short term advantage, and this change will enable to them to plan for longer than 100 years.”