family office services

Family Office Services

Succession Planning and Wealth Management through

Labuan Foundation

Family Office Services

What is family business and who requires family office services?

Who requires Family Office services?Who requires Family Office services?

Businesses involving one or more than one family is known as family business and family businesses typically requires Family Office services for wealth management purposes.

Family Office Services

What are the typical problems encountered by family businesses?

Typical problems encountered by family Typical problems encountered by family businesses…businesses…

Conflict of interest among family members

Lack of succession planning

Decrease in leadership drive

Flat growth to the company

Heirship

Family Office Services

What is the typical structure of family businesses?

Typical structure of family businesses…Typical structure of family businesses…

Founder (1st Generation)

Immediate Members (2nd Generation)

Extended Family(3rd Generation)

Family Office Services

What does family office services cover?

Family Office

Services

Succession Planning Services

Risk Management

Services

Wealth Planning Services

Trust Management

Services

Asset Management

Administrative Services

Tax and Legal

Services

Charity Services

Family Office Services

Where do we start?

Family Office Services

First, set-up a Labuan Foundation…

Succession Planning Services

Labuan Foundation

A Labuan Foundation will be set-up for company and family governance

purposes under our Family Office services

Succession Planning Services

Labuan Foundation

Business will operate as usual…

Ownership issues will be also be taken care…

Family governance in place…

Family Office Services

Use a Labuan Foundation instead of a Company or a Trust because…

Foundation is like a hybrid structure of a company and a trust

A Labuan Foundation is a combination of Company and a Trust…

You get the best of both world…

A Company has the flexibility to change its structure by passing a board resolution…

A Trust provide asset protection by segregate personal asset and business risks...

A Labuan Foundation has both the characteristics of a Company and Trust…

Family Office Services

Setting up a Labuan Foundation…

Labuan Foundation requires the following key personnel…

Founder

* Founder can act either as council member or officer

Council Member

Officer

* Officer should not be related to council member

Secretary

Beneficiary 

Family Office Services

Optimizing ownership with Labuan Foundation…

Wealth creation & protection

Risk diversification

Liquidity management

Leverage

Optimization of Ownership…

Family Office Services

Benefits to your business using Labuan Foundation…

Wealth creation & protection

Enhanced company value protection

Mitigation of intergeneration conflicts

Balance asset & liability management

Additional source of wealth & income

Business…

Family Office Services

Benefits to your family using Labuan Foundation…

Family…

Family culture & values

Family governance

Compensation schemes

Wealth preservation

Succession planning

Risk assessments & profiles

Individual financial & tax planning objectives

Sucession Planning

Do you have in mind who will be the next key personnel?

Succession Planning:Key values for determination of the next leader…

Characteristics(initiative, creative thinking)

Succession Planning:Key values for determination of the next leader…

Behavior (integrity, commitment)

Succession Planning:Key values for determination of the next leader…

Competency(knowledge, skills, talents, experience, abilities)

Succession Planning:Key values for determination of the next leader…

Strategic thinking(Dynamic, tactical, enterprising, entrepreneurial)

Succession Planning:Key values for determination of the next leader…

Relationship / Network building(Charisma, diplomatic, team player, cooperative)

Labuan Foundation

Structure of Labuan Foundation(Non-charitable)

Distribution

Labuan Foundation

Transfer of Assets

Manage Manage Manage

The structure of a non-charitable private foundation

What if the Foundation is established for charitable purposes?

If the Foundation solicits funds/donations from the public….three (3) additional personnel shall be required…

Labuan Foundation

Structure of Labuan Foundation(Charitable)

Distribution

Charitable Foundation

Transfer of Assets

Manage Manage Manage

Additional Personnel

Labuan Foundation

Example of restructuring Labuan Foundation into a family business…

Family business owned by 3 brothers before restructuring…

Business Operations

Local Company

Shareholders

55% 30% 15%

Labuan Foundation

First step of restructuring…Set-up a separate Labuan Foundation

for each family…

Distribution

Labuan Foundation for Mr A family

Transfer of Assets

Manage Manage Manage

For each family, set up a private foundation…

Distribution

Labuan Foundation for Mr B family

Transfer of Assets

Manage Manage Manage

For each family, set up a private foundation…

Distribution

Labuan Foundation for Mr C family

Transfer of Assets

Manage Manage Manage

For each family, set up a private foundation…

Labuan Foundation

Then, set-up a main Labuan Foundation for each Family Foundation…

Proposed Structure

Controlling Stakes

55% 30% 15%

Contact us for more information…

Cheng & Co Trust International Limited

www.chengcotrust.com

Telephone: +603-79848988 | Fax: +603-79844402Website: www.chengcotrust.com | e-mail: info@chengcotrust.com

Kuala Lumpur Office: No 16-G, Jalan 2/114, Kuchai Business Centre,

Off Jalan Klang Lama, 58200 Kuala Lumpur

Labuan Office: Lot 2(a), Level 4, Wisma Lazenda, Jalan Kemajuan,

PO Box 81840, 87000 Labuan FT