News / 07.03.2014

DISMISSAL OF THE FOUNDATION’S BODIES OF A HOLDING FOUNDATION

According to a recent ruling of the Constitutional Court of the Principality of Liechtenstein (StGH 4.2.2014, StGH 2013/108) proper administration of a “business foundation”, managing shareholdings in subsidiaries does not require that continuous information concerning the business activities of subsidiaries converge in the holding foundation. In addition such information must not be provided in writing in the holding foundation.

The board of foundation is not obliged to hold formal board meetings, pass formal resolutions and prepare minutes concerning each control measure it took respective its subsidiaries, their shareholdings, their administration etc. Lack of a formal board meeting and a formal resolution by the board of foundation (including minutes) itself is not a legitimate reason for the dismissal of all members of the bodies of a foundation.

Proper administration of a holding foundation is to be assessed by examining and weighing the overall circumstances and the merits of a case.

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