I have observed one interesting thing in my legal practice in family law area. While Chinese people within China are not much interested in making their estate plan, those overseas Chinese are however more keen to prepare for their late years of life and post-demise affairs.
With so many Chinese migrating to foreign countries across the globe, many of them don’t really liquidate their China assets, so it is inevitable for their estate plans to deal with their assets in China.
In my decade of experience, the main types of estate assets in China are real properties, corporate equities/shares, bank deposits and fund units.
1. Real Properties
This is primarily the most common estate that is left behind by Chinese people.
In real world, the tile of real estaet properties takes multiple forms such as sole ownership (we are actually now advising two clients in dealing with properties held by companies, and the main objective is to transfer the properties finally to the heirs of the corporate owners), joint tenancy, tenancy in common or corporate ownership, and sometime, upon the death of the owner, property title has not been issued yet leaving behind the purchase contract only.
Real estate properties are very special kind of assets or estates. As a universal rule in the world, if there is no will duly made by the owner during life time, upon owner’s death, the inheritance rules applicable thereby shall be the local rules of the place where the properties are located.
So if you don’t want the local government to distribute your estate properties, you’d best make your own will stating how you want your estate properties to be succeeded, and who will receive your estate.
For people living in common law countries like USA, UK, Canada, Australia, and New Zealand and the like, if you want to set up a trust (living or testamentary, revocable or irrevocable), be careful that your trust may not work out in China.[to be continued]