In the world of business ownership and structure, legal ownership and economic ownership are two crucial concepts. While related to ownership, they differ significantly in meaning and implications. Let's delve deeper into this difference and how it applies to corporate structures, especially concerning a Foundation Administration Office (STAK).
Legal ownership refers to ownership of assets such as shares, real estate, or other possessions on paper. The person whose name appears on the legal documents is considered the legal owner, with all rights and responsibilities associated. This may relate to shares in a company, with the legal owner listed in the company's register.
Economic ownership pertains to the rights and benefits arising from owning assets, regardless of who the legal owner is. This includes the right to income, profits, voting rights, and other benefits arising from owning the assets. In the case of shares, the economic owner may be the person or entity deriving financial benefit from the shares, such as dividend payouts or appreciation in value.
Within a STAK, this distinction can be particularly relevant. The STAK often holds the legal ownership of shares in a company, while the economic benefits, such as dividend payouts and voting rights, go to the certificate holders. This separation of ownership and benefits offers various advantages, including privacy protection, succession planning, and tax benefits.
Share Council offers expertise in understanding and implementing structures like STAKs. Our CEO can guide you in understanding legal and economic ownership, as well as how these concepts relate to STAK structures. We can provide tailored advice and assist you in setting up a suitable legal structure that aligns with your specific business needs.
For detailed advice on how legal and economic ownership are relevant in the context of your business and how STAKs can be utilized, we invite you to contact the CEO of Share Council. We're happy to help find the best solutions for your situation.