Wills gaining popularity in Asia but beware of issues over international assets, experts say

Wills gaining popularity in Asia but beware of issues over international assets, experts say

Planning for inheritance appears to be picking up in Asia, according to lawyers who report an increase in the demand for wills.

"There has been explosive growth in wealth and investments in Asia, and perhaps from there, people might have a greater awareness or concern about planning for succession, legacy and business continuity," says Chee Fang Theng, honorary secretary at the Society of Trust & Estate Practitioners (Singapore).

Clients who want wills written come from "all walks of life, from normal working class employees to the ultra-rich with assets spread out all over the world," says Chee, who is also a director at Pan Asia Law.

Dying without a will - a situation known as being intestate - means the deceased person's assets, including cash, real estate and personal property is distributed to heirs in line the country's intestate succession laws, and this can require several applications to the court before the deceased's assets can be dealt with, Chee explains.

Potential complications

There are also potential pitfalls if a person dies intestate, which differ across various jurisdictions.

For instance, in Singapore, a step-child or an illegitimate child of the deceased is not entitled to a share of the estate, according to the Singapore Intestate Succession Act.

But having a will does not always guarantee a complication-free process.

The will could be deemed invalid if it does not comply with legal requirements, and beneficiaries unhappy with their share or third parties cut out the will can challenge the validity of the document, Chee warns.

Raghunath Peter Doraisamy, director at Singaporean law firm Selvam, has also observed an uptick in demand for wills over the past three years, ranging from "simple to complex arrangements."

He adds that a notable trend has been "the increase of clients who have requested to create wills in respect of assets owned in more than one jurisdiction."

And while there is such a thing as an international will, it's advisable to ensure that the relevant laws of each jurisdiction are complied with, to ensure that the will is valid, Doraisamy says.

Trusts an option

The international will convention is governed by the Vienna Convention on the Law of Treaties, but by the principles of international law, a state is only bound by a treaty if the state has ratified that particularly treaty, he said.

Australia and Laos are the only two countries in Asia Pacific that have signed or ratified the Vienna convention.

Apart from wills, trust services are another option, for people seeking to provide lifetime or after-death property management.

For example, trusts might be better for "people with children who are minors, children with special needs, providing gifts for successive generations with or without conditions, or for distributing shares in a business," Doraisamy says, adding that setting up a trust is more complicated than a will and requires the trust to be immediately funded with assets.

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