Civil Law and Cross-Border Trust and Wealth Structures in Europe

1. Introduction

Cross-border trust and wealth-structure disputes arise when assets, settlors, trustees, beneficiaries, foundations, companies, or family members are connected with different European jurisdictions.

Typical structures include:

trusts;

private foundations;

family foundations;

holding companies;

family investment companies;

fiduciary arrangements;

succession structures;

life-insurance-based wealth structures;

charitable foundations;

pension and investment vehicles.

The legal difficulty is that trusts are primarily a common-law institution, while many continental European civil-law systems do not have an identical domestic equivalent. Some European states recognize foreign trusts through the 1985 Hague Trusts Convention, bilateral/private-international-law rules, or domestic jurisprudence, while others provide only limited recognition.

Therefore, cross-border wealth planning requires separating:

existence and validity of the structure;

ownership of the assets;

beneficial interests;

tax treatment;

succession rights;

creditor rights;

recognition and enforcement;

anti-money-laundering/beneficial-ownership obligations.

A particularly important recent development is the CJEU's T Trust, C-483/23, judgment of 21 May 2026, which directly examined a trust structure and the concepts of whether assets “belong to” or are “controlled” by a person for EU restrictive-measures purposes. (EUR-Lex)

2. What Is a Cross-Border Wealth Structure?

A wealth structure is cross-border when one or more elements are located in different countries.

Example

A person resident in Germany establishes a trust governed by Jersey law.

The structure contains:

French real estate;

an Italian bank portfolio;

shares in a Dutch company;

a Luxembourg investment account.

The beneficiaries live in Spain.

This produces several different legal questions:

Thus, there is no single European law of wealth structures.

3. Trusts and the Civil-Law Problem

The traditional trust separates:

legal ownership — trustee;

beneficial/equitable interest — beneficiary.

This conceptual division can be difficult for civil-law systems because many civil-law systems traditionally understand ownership as a unified proprietary right.

For this reason, a European court may have to determine:

Is the trust recognized as a legal relationship, or must its effects be translated into a domestic civil-law concept?

This is one of the most important issues in cross-border trust litigation.

4. Hague Trusts Convention

The 1985 Hague Convention on the Law Applicable to Trusts and on their Recognition provides an important international framework.

Its basic purpose is to determine:

the law applicable to trusts;

recognition of trusts;

effects of recognition.

It does not create a universal European trust law.

Recognition therefore remains dependent on:

the Convention;

national private international law;

mandatory property rules;

public policy;

succession rules;

creditor-protection rules.

5. Trust Governing Law

A trust may expressly choose its governing law.

For example:

“This trust shall be governed by the law of England and Wales.”

But that does not mean every consequence of the trust will automatically be governed by that law.

Mandatory rules of the country where assets are situated can remain important.

For example:

English trust law + Spanish real estate

may still require compliance with Spanish:

land-registration rules;

property law;

succession restrictions;

creditor protection;

tax rules.

6. Case Law 1 — Webb v Webb

CJEU, Case C-294/92

George Lawrence Webb v Lawrence Desmond Webb

This is the leading European case specifically involving a trust and cross-border immovable property.

Facts

The dispute concerned property situated in France.

The claimant sought a declaration that another person held the property as trustee and an order requiring documents to be executed so that legal ownership could be transferred.

The issue was whether the proceedings constituted proceedings concerning rights in rem in immovable property.

Decision

The CJEU held that merely because a trust concerns immovable property does not mean that the proceedings automatically fall within the exclusive jurisdiction rule for rights in rem.

The action was essentially in personam, rather than an action directly determining a proprietary right in rem. (EUR-Lex)

Importance

This case establishes an important distinction:

Trust claim ≠ automatically property claim.

For cross-border wealth litigation, courts must examine the actual legal nature of the claim.

7. Case Law 2 — T Trust

CJEU, Case C-483/23, judgment of 21 May 2026

This is a particularly important current European trust authority.

Background

The case concerned a trust established in the context of EU restrictive measures concerning the war against Ukraine.

The settlor of the trust was subject to EU sanctions.

The question was whether funds and economic resources held by the trust could be regarded as:

belonging to;

or being controlled by;

the sanctioned person.

Importance

The CJEU had to examine the legal reality of the trust structure rather than simply looking at the formal title to the assets.

The case therefore demonstrates that:

Formal ownership by a trustee does not necessarily end the legal inquiry.

Control, rights, powers and the actual structure of the trust can be legally decisive. (EUR-Lex)

Wealth-structure significance

This principle can be relevant to:

sanctions;

asset freezing;

beneficial ownership;

asset tracing;

international wealth structures.

8. Case Law 3 — Centro di Musicologia Walter Stauffer

CJEU, Case C-386/04

Facts

A charitable foundation established under private law in Italy owned property in Germany and received rental income.

German tax law provided tax advantages for certain charitable foundations established in Germany but denied equivalent treatment to the foreign foundation.

Decision

The CJEU held that the relevant restriction on cross-border capital movement could not simply be justified by the fact that the foundation was established in another Member State. (EUR-Lex)

Importance

The case is highly relevant to wealth structures because it concerns a foundation holding investment property across borders.

It demonstrates that:

foundations may fall within EU free-movement principles;

cross-border charitable structures cannot automatically be treated less favourably;

tax residence and organizational form may not alone justify discriminatory treatment.

9. Case Law 4 — Persche v Finanzamt Lüdenscheid

CJEU, Case C-318/07

Facts

A German taxpayer made an in-kind charitable donation to an organization established in Portugal.

German law restricted the tax deduction to donations to domestic organizations.

Decision

The CJEU held that cross-border charitable donations can fall within the free movement of capital.

A Member State could not categorically deny the tax deduction merely because the recipient was established in another Member State, where the taxpayer was unable to demonstrate that the foreign organization satisfied the relevant conditions. (EUR-Lex)

Importance

This is relevant to:

charitable foundations;

philanthropic structures;

family wealth transfers;

cross-border donations.

It demonstrates that wealth can move through legally structured charitable vehicles without automatically losing EU-law protection.

10. Case Law 5 — Jäger v Finanzamt Kusel-Landstuhl

CJEU, Case C-256/06

Facts

The case concerned German inheritance tax and agricultural/forestry assets located in another Member State.

Germany applied a less favourable valuation methodology to foreign property.

Decision

The CJEU found the relevant treatment incompatible with the free movement of capital. (EUR-Lex)

Importance

Wealth structures frequently contain:

agricultural land;

forestry assets;

real estate;

investment property.

Jäger demonstrates that the location of wealth in another Member State cannot automatically justify discriminatory inheritance-tax treatment.

11. Case Law 6 — Welte v Finanzamt Velbert

CJEU, Case C-181/12

Facts

The deceased and heir were resident in third countries, while immovable property was located in Germany.

German inheritance-tax legislation provided a substantially smaller allowance in the relevant non-resident situation.

Decision

The CJEU held that the difference in treatment constituted a restriction on the free movement of capital and could not be justified on the circumstances presented. (EUR-Lex)

Importance

Welte is significant for:

international estate planning;

foreign beneficiaries;

cross-border real estate;

inheritance tax;

non-resident wealth owners.

It shows that cross-border succession and wealth planning can engage EU free-movement principles even when the relevant persons are resident outside the EU.

12. Case Law 7 — Mahnkopf

CJEU, Case C-558/16

Doris Margret Lisette Mahnkopf

Background

The case concerned the interaction between:

matrimonial property;

the surviving spouse's entitlement;

succession law.

Decision

The CJEU held that a German provision increasing the surviving spouse's share could fall within the scope of the EU Succession Regulation, because its primary purpose concerned the determination of the spouse's share in the deceased's estate rather than merely liquidation of the matrimonial property regime. (lynxlex.com)

Importance

This is important for wealth structures because sophisticated estate planning often combines:

marriage;

matrimonial property;

wills;

trusts;

foundations;

lifetime gifts.

Mahnkopf demonstrates that classification is crucial.

13. Case Law 8 — V A and Z A

CJEU, Case C-645/20

Subject

Subsidiary jurisdiction in succession matters.

Principle

The CJEU examined jurisdiction under the EU Succession Regulation where the deceased's habitual residence and assets created an international succession.

The Court clarified how subsidiary jurisdiction operates when the deceased was not habitually resident in a Member State. The case is important for estates containing property across several countries. (Curia)

Importance

For wealth structures:

The location of assets and habitual residence of the deceased can affect which European court can determine succession issues.

14. Case Law 9 — E.E.

CJEU, Case C-80/19

The CJEU addressed jurisdiction and applicable law under the EU Succession Regulation.

The judgment is important for determining:

habitual residence;

succession jurisdiction;

applicable succession law;

cross-border estates.

It helps distinguish succession questions from other aspects of wealth ownership.

The CJEU later referred to E.E. alongside V A and Z A when explaining the operation of the Succession Regulation. (EUR-Lex)

15. Case Law 10 — The J. Paul Getty Trust and Others v Italy

ECtHR, Application No. 35271/19, judgment 2 May 2024

The European Court of Human Rights dealt with property-related issues involving the J. Paul Getty Trust and Italy.

The case is relevant to the broader principle that property interests held through institutional or structured arrangements can engage Article 1 of Protocol No. 1.

The ECtHR's property jurisprudence recognizes that “possessions” can include certain legally protected economic interests beyond simple physical ownership. (ECHR-KS)

Importance

For wealth structures, the practical lesson is:

Legal structuring does not remove property interests from fundamental-rights protection.

16. Trusts and Immovable Property

Real estate is one of the most difficult assets for cross-border trusts.

Suppose:

trust governed by Swiss law;

trustee in England;

beneficiary in France;

property in Spain.

Questions include:

Who is registered as owner?

Does Spain recognize the trust?

Can the trustee be registered?

Can the beneficiary claim a proprietary interest?

What happens on sale?

What happens on insolvency?

What happens on death?

Which law governs succession?

Are forced-heirship rules applicable?

Webb demonstrates why the classification of the claim—personal or proprietary—is critical. (EUR-Lex)

17. Trusts and Succession

A trust may be established during the settlor's lifetime but become particularly important after death.

The estate may contain:

trust assets;

personally owned assets;

company shares;

real estate;

insurance policies.

The question becomes:

Are the trust assets part of the deceased's estate?

The answer depends on:

trust law;

ownership;

applicable succession law;

reserved/forced-heirship rules;

validity of lifetime dispositions;

anti-avoidance provisions.

The EU Succession Regulation does not regulate every aspect of trusts. Certain questions concerning the validity, administration and effects of trusts are outside its scope.

Therefore, trust law and succession law must be analyzed separately.

18. Forced-Heirship Rules

Civil-law countries frequently protect certain heirs.

Examples include:

children;

surviving spouses;

sometimes other close relatives.

A person may therefore create a foreign trust but still face claims based on mandatory succession rights.

A wealth structure cannot automatically defeat every mandatory rule of the country whose succession law applies.

19. Lifetime Gifts and Wealth Structures

Wealth may be transferred before death through:

gift;

settlement;

foundation contribution;

trust settlement;

family holding company;

life insurance.

Courts may examine whether the transaction was:

genuine;

irrevocable;

simulated;

fraudulent;

intended to defeat creditors;

intended to defeat protected heirs.

20. Creditor Protection

A trust may provide asset-separation effects, but this does not create unlimited protection.

Creditors may challenge transfers where applicable law recognizes:

fraudulent conveyance;

insolvency avoidance;

transaction at undervalue;

abuse of rights;

sham arrangements.

The relevant law depends heavily on:

location of assets;

debtor's residence;

insolvency proceedings;

applicable law;

timing of transfer.

21. Foundations as Wealth Structures

European civil-law countries are more familiar with foundations than common-law trusts.

A foundation generally involves:

dedicated assets;

a separate legal personality in many jurisdictions;

a statutory purpose;

governing organs;

beneficiaries or public purposes depending on the jurisdiction.

Foundations can therefore be used for:

philanthropy;

family wealth;

cultural activities;

preservation of assets.

The Stauffer case demonstrates the EU-law relevance of cross-border foundations and their investment income. (EUR-Lex)

22. Family Foundations

Family foundations can be used to:

preserve family businesses;

hold shares;

prevent fragmentation of assets;

provide income to family members;

govern succession;

protect long-term assets.

However, the foundation's legal treatment differs considerably between European jurisdictions.

A foundation created in one state may not receive exactly the same treatment in another.

23. Holding Companies

A family may place wealth into:

Family → Holding company → Investments

instead of:

Family → Direct ownership.

This creates separation between:

shareholder ownership;

company assets;

management;

beneficiaries.

Cross-border company law can therefore become relevant.

Issues include:

seat of company;

applicable company law;

shareholder rights;

distributions;

creditor claims;

succession to shares.

24. Life Insurance as a Wealth Structure

Life insurance may be used for:

succession planning;

liquidity;

beneficiary designation;

asset transmission.

Cross-border questions can concern:

policy ownership;

beneficiary rights;

inheritance tax;

matrimonial property;

creditor claims.

The legal characterization of the policy can differ between countries.

25. Beneficial Ownership

Modern European wealth structures are heavily affected by beneficial-ownership transparency.

Authorities may need to identify:

settlor;

trustee;

protector;

beneficiaries;

persons exercising control.

This is important for:

anti-money laundering;

sanctions;

tax transparency;

financial regulation.

The T Trust case demonstrates how the concepts of ownership and control can become decisive when a trust holds assets connected to a sanctioned settlor. (EUR-Lex)

26. Trust and Sanctions

The T Trust judgment is especially significant because it shows that a trust cannot necessarily be analyzed solely by asking:

“Whose name is on the asset?”

A regulator may need to examine:

settlor powers;

trustee powers;

beneficiary rights;

ability to revoke;

ability to amend;

control over distributions;

practical influence over the assets.

Thus:

Legal title ≠ necessarily economic control.

27. Taxation of Trust Structures

Tax authorities may analyze:

residence of settlor;

residence of trustee;

residence of beneficiary;

location of assets;

distributions;

retained income;

capital gains;

inheritance tax;

gift tax.

Different jurisdictions may characterize the same trust differently.

For example, one state may treat:

trust income as belonging to the beneficiary,

while another may attribute it to:

the settlor or trustee.

This can create double-taxation disputes.

28. Cross-Border Charitable Wealth

The Stauffer and Persche cases are particularly useful here.

A person may:

establish a foundation in one country;

donate from another;

hold property in a third;

receive tax treatment in several jurisdictions.

EU free-movement principles can limit discriminatory treatment of genuine cross-border charitable activity. (EUR-Lex)

29. Property Rights and the ECHR

Article 1 of Protocol No. 1 protects peaceful enjoyment of possessions.

The ECtHR uses an autonomous concept of “possessions”, which can extend beyond traditional physical ownership to certain legally protected economic interests. (ECHR-KS)

Therefore, wealth-structure litigation can engage:

deprivation of property;

control of use;

confiscation;

freezing;

legitimate expectations;

restitution.

However, property protection is not absolute.

States retain powers concerning:

taxation;

economic regulation;

confiscation;

public interest.

30. Asset Freezing

Cross-border wealth structures may be frozen because of:

sanctions;

criminal proceedings;

insolvency;

tax enforcement;

fraud investigations.

The legal question becomes whether the freeze is:

based on law;

pursuing a legitimate objective;

proportionate;

subject to procedural safeguards.

The ECHR's property jurisprudence recognizes that states may control property in the general interest, including measures connected with taxation and penalties, subject to Convention requirements. (HUDOC)

31. Trusts and Insolvency

Suppose:

settlor becomes insolvent;

assets were transferred into a trust;

creditors argue that the transfer was intended to defeat them.

The court may have to determine:

whether ownership actually transferred;

whether the trust is genuine;

whether the transfer is voidable;

whether the assets belong to the insolvency estate;

whether beneficiaries have proprietary claims.

Cross-border insolvency rules can therefore interact directly with trust law.

32. Divorce and Matrimonial Property

A sophisticated wealth structure can become relevant during divorce.

Possible assets:

family trust;

foundation;

company shares;

foreign bank accounts;

investment portfolio.

The court may have to determine:

whether the asset is legally owned by the spouse;

whether the spouse has a beneficial interest;

whether the structure should be taken into account;

whether the arrangement was created before or during marriage.

The Mahnkopf case illustrates the importance of distinguishing matrimonial-property issues from succession issues. (lynxlex.com)

33. Cross-Border Estate Administration

An international estate may involve:

Country A: deceased's habitual residence
Country B: trust
Country C: real estate
Country D: bank accounts
Country E: company shares

The administrator may need to determine:

applicable succession law;

jurisdiction;

recognition of foreign documents;

ownership;

tax;

forced-heirship rights.

The EU Succession Regulation can provide important jurisdiction and applicable-law rules, but it does not comprehensively regulate trust law.

34. Recognition Problems in Civil-Law Countries

A civil-law court may encounter a foreign trust that has no domestic equivalent.

The court may ask:

Question 1

Is the trust recognized?

Question 2

What law governs it?

Question 3

What rights does the beneficiary possess?

Question 4

Can those rights be enforced against third parties?

Question 5

Can the trustee register property?

Question 6

Does recognition violate public policy?

Question 7

Do mandatory succession rules override the arrangement?

35. Public Policy

Public policy can limit recognition where a wealth structure conflicts fundamentally with domestic law.

Potential concerns include:

forced-heirship protection;

creditor protection;

fraud;

illegality;

sanctions;

money laundering;

public-order rules.

But public policy should not be treated as a general reason to reject every foreign legal institution.

36. Conflict-of-Laws Analysis

A cross-border trust dispute should normally be analyzed in stages.

Step 1 — Identify the structure

Is it:

trust;

foundation;

company;

insurance;

fiduciary arrangement?

Step 2 — Identify the assets

Are they:

real estate;

shares;

bank accounts;

intellectual property;

movable property?

Step 3 — Identify the parties

settlor;

trustee;

beneficiary;

protector;

heirs;

creditors.

Step 4 — Identify the dispute

validity;

ownership;

succession;

taxation;

creditor claim;

enforcement.

Step 5 — Determine applicable law

Different issues can be governed by different legal systems.

37. Important Case-Law Table

38. Direct Trust Cases vs Supporting Wealth-Structure Cases

It is important to distinguish the authorities.

Direct trust authority

Webb — directly concerned a trust and foreign immovable property. (EUR-Lex)

T Trust — directly concerned a trust, asset ownership/control and EU sanctions. (EUR-Lex)

Foundation/wealth-structure authorities

Stauffer — charitable foundation and cross-border taxation. (EUR-Lex)

Persche — cross-border charitable transfers. (EUR-Lex)

Succession/estate authorities

Jäger, Welte, Mahnkopf, V A and Z A, and E.E.

These cases do not all concern trusts directly. They are important because trusts and other wealth structures frequently operate within the broader context of cross-border succession, taxation and property ownership.

39. Practical Example

Assume:

settlor lives in Germany;

trust governed by English law;

trustee located in Switzerland;

beneficiary lives in France;

French apartment owned by the trust;

shares held in Luxembourg;

settlor later dies.

Potential disputes include:

Issue 1 — Trust recognition

Does the relevant civil-law jurisdiction recognize the trust?

Issue 2 — French property

How is the trustee's ownership treated under French property law?

Issue 3 — Succession

Can French forced-heirship rules affect the trust?

Issue 4 — Tax

Which country taxes the property, income and eventual transfer?

Issue 5 — Beneficiary

Does the beneficiary have an enforceable proprietary or merely personal right?

Issue 6 — Creditors

Can creditors challenge the settlement?

Issue 7 — Jurisdiction

Which European court has authority over each dispute?

Issue 8 — Enforcement

Can a judgment concerning the trust be enforced against property located elsewhere?

This demonstrates why one wealth structure can generate several different legal proceedings.

40. Key Legal Principles

Principle 1 — Trusts are not uniformly regulated across Europe

European jurisdictions differ substantially in their recognition and treatment of trusts.

Principle 2 — Legal title and beneficial interest may be treated differently

The distinction is central to trust litigation.

Principle 3 — Asset location remains important

Especially for:

real estate;

registered property;

shares;

security interests.

Principle 4 — Succession law can limit wealth planning

Trust structures do not automatically eliminate mandatory succession rights.

Principle 5 — EU free movement affects wealth structures

Cross-border capital and charitable structures may benefit from EU free-movement principles.

Principle 6 — Tax treatment remains largely national

EU law constrains discrimination and restrictions but does not create one European wealth-tax system.

Principle 7 — Substance can matter more than formal title

The T Trust judgment is a particularly clear modern illustration in the sanctions context. (EUR-Lex)

Principle 8 — Fundamental rights remain relevant

Property confiscation, freezing and interference with economic interests may engage Article 1 of Protocol No. 1.

41. Conclusion

Cross-border trust and wealth structures in Europe are governed by a combination of private international law, national property law, trust law, succession law, tax law, company law, insolvency law, EU free-movement rules, sanctions law and human-rights principles.

The central difficulty is that Europe does not have one uniform law of trusts. A trust created under one legal system may hold assets governed by several different legal regimes.

The most directly relevant modern authorities include Webb (C-294/92) on the jurisdictional treatment of trust claims concerning immovable property and T Trust (C-483/23) on the legal significance of trust ownership and control. Stauffer, Persche, Jäger and Welte further demonstrate how European free-movement principles affect foundations, charitable wealth and cross-border inheritance. (EUR-Lex)

Ultra-Basic Keywords

Trust → Settlor → Trustee → Beneficiary → Protector → Legal Title → Beneficial Interest → Foundation → Family Wealth → Holding Company → Succession → Forced Heirship → Gift → Inheritance → Tax → Real Estate → Bank Account → Shares → Beneficial Ownership → Asset Protection → Creditors → Insolvency → Recognition → Jurisdiction → Applicable Law → Public Policy → Sanctions → Asset Freezing → EU Free Movement → Property Rights → Cross-Border Wealth.