Compliance guide
KYC for foundations: which documents are needed
Updated: · Leutrim Miftaraj, FLIORE · Editorial standards · Other languages: Deutsch · Français · Español
Short answer
For a foundation, banks and obliged family offices require the foundation deed with its articles and any by-laws or supplementary deeds, a current register extract, information and identity documents for the founder, the foundation board, the protector and the beneficiaries, and evidence of the source of the endowed assets. For discretionary foundations the class of beneficiaries is often enough at first – but no longer before a distribution.
Not all foundations are alike
The Swiss family foundation, the Liechtenstein foundation, the Austrian private foundation and the German family foundation differ considerably in purpose, bodies and supervision. For the KYC review they have one thing in common: the foundation owns itself, and who benefits or exercises influence only emerges from the founding documents and ancillary deeds.
The documents in detail
- Foundation deed and articles, with all amendments.
- By-laws (Liechtenstein), supplementary deed (Austria) or regulations, insofar as they govern beneficiaries or rights.
- A current extract from the commercial, company or foundation register, or a confirmation of deposit.
- Information and identity documents for the founder, members of the foundation board, the protector or curator and named beneficiaries.
- Evidence of the source of the endowed assets and of later additions.
- Tax classification for AEOI/CRS and FATCA.
Bank forms in Switzerland
Swiss banks record foundations on Form S under the banks' code of conduct with regard to due diligence (CDB). This covers in particular the actual founder, the beneficiaries or classes of beneficiaries, persons with instruction or control rights, and whether the founder can revoke the foundation or change beneficiaries. For Liechtenstein foundations with reserved founder's rights, this information is essential.
Discretionary foundations and distributions
Many family foundations provide for no fixed entitlements but for the discretion of the foundation board. For account opening, the class is then often sufficient. Before every distribution, however, the recipient must be identified and – where risk is higher – screened. A resolution of the foundation board stating name, amount and purpose belongs in the file.
Common gaps
Changes on the foundation board that were never updated, by-laws that were never shown to the bank, founders who have died without the documents being adjusted, and beneficiaries who have received distributions for years without ever having been identified. Such gaps come to light at the latest at the next bank review or supervisory inspection.
In FLIORE
In FLIORE the foundation is a mandate in its own right, with roles for founder, foundation board, protector and beneficiaries. Deeds and by-laws are stored with versions in the document vault, deadlines of the foundation supervisory authority in the compliance calendar, and the KYC package compiles the documents for a bank.
At a glance
| Core documents | Deed, articles, by-laws or supplementary deed, register extract |
|---|---|
| Roles | Founder, foundation board, protector, beneficiaries |
| Swiss bank form | Form S (CDB) |
Terms on this page
- Forms A, K, S and T
- Standardised forms used by Swiss banks to establish the beneficial owner: A in general, K for controlling persons, S for foundations and T for trusts.
- Founder's rights (Liechtenstein)
- For a Liechtenstein Anstalt, the entirety of the rights to decide on the Anstalt – transferable and inheritable unless the articles provide otherwise.
- Family foundation
- A foundation whose purpose lies predominantly in the interest of one or more families.
- Protector
- A person or body that supervises the trustee of a trust or the board of a foundation and holds certain consent rights.
- FATCA
- US law under which foreign financial institutions must report accounts of US persons to the US tax authority, the IRS.
Frequently asked questions
Must the by-laws of a Liechtenstein foundation be shown to the bank?
The bank must know the beneficial owners; if the beneficiaries are set out in the by-laws, it needs that information. Whether the document itself or an extract is provided should be agreed with the bank and the foundation board.
Who is the beneficial owner of a foundation?
Depending on the legal system, the founder, members of the foundation board, the protector, beneficiaries or classes of beneficiaries and other persons with control count as beneficial owners. The roles as a whole are decisive.
What changes when the founder dies?
Reserved founder's rights usually lapse, and control shifts to the foundation board and the beneficiaries. The KYC documents must be adjusted accordingly, at all banks.
Does a charitable foundation need the same documents?
In principle yes, although beneficiaries are often described as a class defined by the purpose. Charitable foundations are also under state supervision, which usually lowers the risk.
Sources
- Swiss Bankers Association – code of conduct with regard to due diligence (CDB)
- Swiss Civil Code (ZGB), Art. 80 et seq. – Fedlex
- German Money Laundering Act (GwG), section 3 – Beneficial owner
- Liechtenstein Persons and Companies Act (PGR) – gesetze.li
This page provides orientation and does not replace legal or tax advice. The cited legal sources in their applicable version are authoritative.
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