Are you ready for the Family Office? We are!
Managing the assets of families just like those of entrepreneurs
Thanks to its law on Family Offices, which is unique in the world, Luxembourg has
the tools it needs to complement its outstanding expertise in structuring,
optimising and managing the assets of wealthy families.
GMS Group has been advising wealthy families for more than 30 years, helping
them to preserve their assets over the long term, while assisting entrepreneurs
with their international expansion.
Mr. Jourdan, as CEO of Global Management & Services Group, can you tell us why
Luxembourg is particularly interesting to anyone wanting to preserve their
family’s assets in the long term?
As a leading financial centre with extensive tools and expertise, Luxembourg nowadays
offers a wide range of quality services in terms of asset structuring and management.
Thanks to its positioning and its multilingual environment, Luxembourg is now beyond
doubt the country that is best equipped to meet the requirements and expectations of a
wealthy and international client base. Things have become particularly interesting since
2012, when Luxembourg’s lawmakers passed a law that is unique in the world, framing
the activity of Family Office firms. It defines access to the profession and lays down even
greater protective guarantees for clients who want to benefit from these services.
Luxembourg has thus met the requirements of many local and foreign entrepreneurs
and their families in terms of asset management.
What are the requirements of this specific client base and how does the Family
Office concept meet these requirements?
Wealthy families have many requirements, and the Family Office concept meets them to
a large extent, thanks to the extensive scope of the services on offer to such clients.
These commonly range from managing assets (and not only financial assets) and
investments, to providing assistance and advice to the families with taxation and legal
aspects, the key challenges of structuring and optimising their assets as well as
succession planning, taking into consideration the expectations of all of their members.
But things can go much further. The services provided by a Family Office can for
instance incorporate property maintenance and even concierge services. The aim of the
Family Office is to simplify the lives of wealthy clients and their families, and to lift the
burden of administration, financial and taxation matters from their shoulders, to ensure
the preservation of the assets and holdings of the family across several generations.
Thanks to its experience of over 30 years, GMS Group assists entrepreneurs with the
growth of their businesses worldwide, not only through the provision of advice and
assistance in such fields as accountancy, taxation and law, but also through a range of
services that are structured in a Family Office approach.
Why should a client resort to a Family Office rather than a private banker?
Surveys conducted among wealthy clients worldwide show that from a certain level of
wealth, there is a lessening of the trust that one has in one’s bankers. No less than 40%
of wealthy families evoke a lack of trust in their traditional bankers. This is most often
due to a lack of information and of transparency linked to international asset bases that
are often highly complex. Structuring and preserving a family fortune comprising assets
located in several jurisdictions, taking into consideration the wide range of aspirations
of the beneficiaries over several generations, can be an extremely complex challenge to
deal with. There are a lot of pitfalls to avoid. For instance, 25% of the families of
entrepreneurs do not have a proper structure in place to protect their assets, simply
because no distinction has been drawn between personal and business assets. A family’s
assets might therefore be at risk in case of a reversal of fortune of its business ventures.
To sum things up, very wealthy families have different expectations, and more specific
requirements, than can be hardly addressed by a traditional banker. They need a
Can a Family Office offer them this kind of service?
Absolutely! With a Family Office, they deal with a single contact person, who has an
overview of all the family’s assets, who is thoroughly aware of the expectations and
aspirations of each of its members and who can find solutions under the specific
circumstances at hand that satisfy everybody while addressing the challenges of
preservation, asset structuring and succession planning. This is a long-term service,
dedicated to meeting the requirements of the family as a whole. Beyond mere asset
management, the Family Office can provide concierge services, for instance overseeing
the maintenance and repair of the client’s yacht in Singapore or summoning the pilots of
their private jet for a trip organised at the last minute… It can even actively manage the
family’s art collection.
How would you categorise the Family Office services provided by GMS Group?
A distinction must be drawn between two forms of family Office: the Single Family Office
and the Multi-Family Office. The first consists of a structure dedicated to a single client,
and provides the range of services required to meet the requirements of that client in
terms of assets, organisation and finance. Such a service can only be provided to clients
who have significant assets, usually in excess of 150 million euros. GMS is more active in
the second category, providing Family Office services to several clients, by offering its
expertise in taxation, international organisation and asset structuring to meet their
requirements, and resorting to top-notch external service providers for specialist
services: for the management of financial assets, we can call upon our financial partners;
for legal issues, upon our regular law firms; for logistics, upon specialised contractors;
for art collections, upon our dedicated art management company. Our role is to
coordinate all these professionals in the best interests of our clients. The Multi-Family
Office approach is thus more accessible, and is suited to clients who have assets ranging
from 5 to 150 million euros.
The service you offer therefore transcends mere financial management…
Yes, and this is our unique selling proposition. Traditional Family Offices are often
focused to a large extent on financial asset management.
However, most large family fortunes tend to be generated by entrepreneurs who are still
in business, or by an international business which is still operating. So we pay particular
attention to the management of the entrepreneur’s affairs. Apart from the financial and
legal aspects, for which we can offer our clients the cutting-edge skills of our partners,
we also provide general assistance to entrepreneurs. We foster the growth of their
businesses, the management and the structuring of their assets, through our accounting,
taxation, management, social and art services and expertise! Whatever the jurisdictions
in which our clients and the members of their family are based, or in which they perform
their activities, we can provide them with services that will meet their requirements and
What are the particular strengths of GMS?
Our Group consists of several companies with complementary activities and expertise in
such fields as accountancy, administrative, taxation and legal services, assistance
through managerial coaching, strategic growth consultancy, preparation for and
assistance with generational transition, providing advice to families and even assistance
with the management of their art collections. The grouping of all these skills under a
single roof enables us to meet a wide range of requirements. Our added value, above all
else, is generated through assistance and advice locally and internationally. Be it for the
growth of a business worldwide or the preservation and management of a family’s
assets, we provide bespoke services based on the position of each client. Obviously, this
is only possible if one has a good understanding of the client’s specific circumstances. At
GMS, clients have a single contact person who takes the time to listen to them, to advise
them properly, to optimise their position, both from an entrepreneurial point of view
and for the preservation of their assets over several generations.
In a bid to ensure a high quality service and optimal protection for clients,
Luxembourg’s lawmakers have decided to regulate the activity of Family
Office and the right to use this term. They have done so through the law of
21 December 2012. This law specifically covers Family Offices that
provide services to several families or to asset-bearing vehicles belonging
to several families (multi-Family Offices). Under the new law, the activity
of Family Office involves providing, on a professional basis, advice or
services in connection with asset structuring and financial management,
such as succession planning, and the administration and coordination of
service providers as well as the monitoring and assessment of their
performances. Services that are not connected with financial assets, such as
the management of buildings, art collections or precious objects, are not
covered by this law. However, these services are often offered by GMS
Group. For instance, GMS Group protects the works of art and precious
objects of some of its clients. To that end, it takes advantage of the
facilities provided by Luxembourg’s Freeport, a facility dedicated to the
storage of precious objects.