New Zealand is pushing forward with a new Trust Bill which places new duties on trustees to keep beneficiaries informed of the management of trust assets.
Currently, the beneficiaries of the country’s 300,000 – 500,000 trusts generally have no rights to question and challenge the decisions of trustees. The proposed law changes will mean trustees must routinely disclose certain core trust documents to beneficiaries.
They will have to make reasonable efforts to actively notify all beneficiaries and every parent, guardian or property manager of a minor or incapable beneficiary that they are a beneficiary of the relevant trust; the names and contact details of the trustees; and any changes to the trustees.
Beneficiaries must also be told they have the right to make a request and be provided with a copy of the terms of the trust, including any amendments to the terms of the trust; and that they have the right to request other trust information.
There is a presumption that a trustee must, within a reasonable period of time, give a beneficiary the trust information requested, or provide a reasonable explanation as to why they have not received said information.
The Bill offers a list of factors to be taken into account when refusing a request.
The global trend in the charity sovereign wealth and trust area has seen stakeholders, such as beneficiaries and donors, expecting more transparency and accountability from trustees.
It is expected New Zealand will follow suit and adopt global best practice as its Parliament’s Justice Select Committee has just cleared the Trusts Bill.