Treuhandgesellschaft

A Treuhandgesellschaft, or trust company, is a legal entity that holds and administers assets for designated beneficiaries on the basis of a Treuhandvertrag (trust agreement). The company acts in a fiduciary capacity and does not own the assets it manages; its duties are defined by contract, applicable civil law, and professional standards.

Typical functions include safekeeping and administration of assets such as cash, securities, real estate, and business interests; asset management and investment oversight; estate and succession administration; and corporate trust arrangements, such as holding shares or voting rights for founders or employee-ownership plans. Treuhandgesellschaften may also manage assets for charitable purposes or for foundations.

Fiduciary duties require impartiality, prudent and professional asset management, confidentiality, and accurate accounting. The entity must avoid conflicts of interest and comply with regulatory requirements relevant to financial services, corporate governance, and trust administration. In German-speaking countries, the treuhand concept is grounded in civil-law contracts, with Treuhandgesellschaften often operating within banks, wealth managers, or as independent fiduciary firms. Licensing, supervision, and professional standards vary by jurisdiction.

Typical applications include estate planning and inheritance settlement, corporate governance arrangements where ownership or control is placed in trust, management of employee benefit or share plans, and structured asset protection or charitable trusts. The structure is used to provide professional administration, continuity, and a clear legal framework for transferring and managing wealth across generations or organizational structures.

Relationships with clients are contractual and ongoing, with clear reporting, accounting, and audit-related obligations to ensure transparency and compliance.