Mourant were instructed by the UK branch of a Saudi Arabian family office in relation to the restructuring of the ownership of a substantial UK commercial real estate portfolio. The real estate was already owned by a number of Jersey companies (the Group Companies) and shares in the Group Companies had been given to the family members (comprising various members of G1 and G2), with the proportionate holdings being in accordance with Shari’a succession principles.

After consultation with family members, the family office and UK counsel, it was decided to create a series of new trust structures, one for each settlor, each with its own holdco (the Holdcos). The shares in the Group Companies were then transferred to the Holdcos, and a shareholder agreement (the SHA) put in place between the Holdcos as the shareholders of the Group Companies. This created an additional level of robust governance as between the different family branches, regulating various matters including management of the Group Companies, pre-emption rights, exit terms and valuation.

While it was acknowledged that individual branches might wish to go their own way at some point in the future (hence the importance of agreeing exit terms) it was also anticipated that, at least initially, the trusts would be on the same terms and governed by similar principles. Protectors were appointed in relation to each trust with responsibility for guiding the trustees in relation to Shari’a succession principles. Additionally, investment advisers were appointed with responsibility for managing trust assets in accordance with Shari’a investment principles. Advice is taken from Islamic scholars when necessary.