Wealth Solutions & Wealth Planning
How Indonesian clients can preserve family wealth
Marcus Dearle of Berwin Leighton Paisner
Dec 9, 2013
Marcus Dearle, partner and office managing director Asia at Withers, based in Hong Kong, explains how Indonesian families are looking for ways to protect and preserve the wealth they have worked hard to accumulate.
There’s no denying the significant wealth management opportunity that Indonesia presents. According to the Wealth-X / UBS billionaire census 2013, Indonesia now boasts 23 billionaires, with a total net worth of US$ 47 billion.
The number of ultra-wealthy families in Indonesia has grown significantly over the past decade, affirms Marcus Dearle, partner and office managing director Asia at Withers.
According to Dearle, a major concern for these clients is succession planning and wealth preservation including divorce disputes and also non-matrimonial family disputes amongst family members affecting their businesses, trust assets and personal wealth.
“They come to us for overall succession planning advice including dealing with family law disputes, issues relating to their businesses, and dynastic trust planning,” he explains.
“Most of these ultra-high net worth families have assets and family members in different parts of the world – and so they need international advice – and they are becoming more aware of the need to think internationally and not wrongly to jump to the conclusion that the law in their domestic jurisdiction will apply in foreign jurisdictions which has been a common misconception.”
Keeping it in the family
It’s very important, says Dearle, to have consultations with families at the earliest possible stage to protect their assets as far as possible from divorce – which can be very destructive to the family wealth.
In divorce settlements in some parts of the world, for example in Hong Kong, 50:50 splits are common – meaning a client could be at risk of losing half of their wealth to their ex-spouse.
A prenuptial agreement (pre-nup) is a contract entered into prior to marriage, including provisions for division of property and spousal support in the event of the marriage breaking up. A postnuptial agreement (post-nup) differs from a pre-nup only in that it is entered into after the parties are married.
“If there is a significant difference in the wealth between the two parties, it is sensible to consider entering into one of these types of agreements,” advises Dearle “to protect the wealth of the financially stronger party.”
Keeping matters confidential
For wealthy Indonesian families, confidentiality is a vital component of such planning.
“Clients want to know how they can avoid their family’s disputes and level of the wealth from being disclosed. They don’t want their own children knowing how much wealth they have – let alone non-family members or future spouses” explains Dearle.
In some jurisdictions, no financial disclosure is required for a pre-nup to be enforceable, but in most disclosure is required.
Partner, Head of Family Asset Protection - Private Client at Berwin Leighton Paisner
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