The Delegated Powers and Law Reform Committee has launched a consultation on the proposed Trusts and Succession (Scotland) Bill, which would modernise the operations of trusts and rules around succession.
Changes to the law are planned in two areas - altering how trusts are administrated and managed, as well as changing the order of who has a right to inherit when someone dies without a will.
Trusts are used for a wide range of legal purposes that impact on families, businesses, charities and financial institutions. A trust enables assets to be legally owned by one person or entity while a different individual, entity or group of people can benefit from the asset.
The Scottish Law Commission recommended that both trust law and succession law be updated.
Currently Scots law around trusts is largely based on an Act passed in 1921. It is now believed that there are £500bn worth of assets held in trusts in Scotland today.
The parliamentary commission completed a review of trust law in 2014, which identified a number of outdated areas of law in need of modernisation. Changes to succession law were also recommended by the commission following reform work and public consultations over many years.
The Scottish Government is now seeking to change the law around both trusts and succession with this Bill.
The committee’s scrutiny follows recent work on the Moveable Transactions (Scotland) Bill at stage one. In that case, the committee welcomed the general principles of the Bill, but did raise concerns with the government about the impact it might have on consumers.
Stuart McMillan, convener of the Delegated Powers and Law Reform Committee, said: “Trusts are long established in Scotland, yet their significance is not recognised in wider society.
“We would like to understand more about how trusts are used in Scotland and what impact the changes in this Bill might have on Scottish individuals, businesses, charities and institutions.
“We’re particularly keen to hear from professional trustees, whose commercial business includes handling trusts for other people, and lay trustees, who are not acting in a professional capacity in their role.”
In addition to its consultation, the committee will hold a series of public evidence sessions on the Bill in the spring.
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