China: Pilot programs on the registration of trust assets

13 Nov 2025    5 minute read
Trust Asset Registration Real Estate Trusts Circular 337

In brief

PRC Trust Law has been in effect for over two decades. However, the absence of supporting policies (including, for example, detailed rules on the transfer and ownership of trust assets, trust asset registration regime, relevant tax rules, etc.) has significantly hindered the further development of family trusts in China.

This article appears in the third edition of the Private Wealth Newsletter 2025.

Contents

In more detail

Among other issues, although the Trust Law provides that the settlement of trust assets requires registration to establish a valid trust, China has not yet implemented a specific trust asset registration regime. As such, the settlement of trust assets can only be effected and registered as a normal asset transfer. This crucial gap means the legal status of the relevant property as trust assets is not publicly disclosed, which remains a key concern for investors intending to set up a trust in China.

Against this backdrop, since the end of last year, multiple localities in China have launched pilot programs to implement a trust asset registration regime within a specified scope on a trial basis. On 11 December 2024, Beijing took the first step by issuing the Circular on Implementing the Registration of Real Estate as Trust Assets (Jing Jin Fa [2024] No. 337, “Circular 337”), which provides that the real estate trust established by Beijing-based trust companies with real estate located within Beijing must complete trust asset registration according to the circular. Circular 337 is implemented as a one-year pilot program and expires at the end of 2025. The registration process comprises three steps:

  1. Trust product preregistration
    The trust company conducts preregistration for the trust product with China Trust Registration Co., Ltd., obtaining a trust product code and notice of completion.
  2. Execution of trust documents
    The settlor and the trust company sign the trust documents to specify the trust purposes, trust assets, duration, rights and obligations of trust parties, and the management, use and disposal of the trust assets.
  3. Registration of trust assets
    The real estate registrar processes the real estate registration application based on supporting documents issued by China Trust Registration Co., Ltd., trust documents and deed tax payment certificate (or certificate of deed tax reduction/exemption). A remark must be added on the real estate registration certificate noting that “real estate trust asset, trust product name: ***.”
    Following Beijing’s issuance of Circular 337, Shanghai, Guangzhou and Xiamen also issued their respective real estate trust asset registration pilot programs. The basic registration procedure in these three localities is largely similar to the above provisions under Circular 337, with certain additional supplements or adjustments in each locality, for example:
  • Shanghai
    In addition to the registration for settlement of real estate as trust assets, Shanghai also specifically provides the registration requirements (e.g., removal of the “trust asset” remark on the real estate registration certificate) applicable to the distribution of real estate to beneficiaries, or disposal of real estate by the trustee.
  • Guangzhou
    Guangzhou’s pilot program expressly recognizes that the trust can be established based on the settlor’s will, and the trustee can apply for real estate trust asset registration with all statutory heirs to the real estate present to recognize the validity of the will.
    Guangzhou also specifically allows for an advance notice registration procedure for real estate to be transferred to the trust. According to the PRC Civil Code and relevant rules, upon registration of the advance notice, the settlor will not be able to dispose of the real estate without the trustee’s prior approval, in order to ensure that the real estate will be transferred to the trust in the future as planned.
    Similar to Shanghai, Guangzhou also provides the registration requirements applicable to the distribution or disposal of the real estate.
  • Xiamen
    Xiamen’s pilot program provides more detailed real estate registration procedures applicable to different scenarios throughout the operation of the trust, including trustee receiving real estate to establish the trust, settlor increasing additional real estate into an established trust, trustee purchasing real estate with the trust fund, change of trustee or beneficiary, distribution of real estate, etc.
    Regarding the remarks on the real estate registration certificate, besides the general remark as under Circular 337, Xiamen also requires the names of trust settlors and beneficiaries be added on the certificate for certain specified trusts.

Registration of equities as trust assets

Besides the above local measures regarding the registration of real estate, Beijing also started another pilot program to allow the registration of equities as trust assets. With the registration procedure largely the same as that applicable to real estate under Circular 337, the Market Regulation Administration will handle the registration application, and a note on the investee company’s business license that its shareholder represents the corresponding trust product.

Observations

As demonstrated by the local pilot programs, China is proactively exploring the development of a trust asset registration regime and aims to build a comprehensive trust asset registration system through cooperation across government departments. Such progress is a welcome move for the development of onshore family trusts in China. Interested parties are recommended to keep monitoring the relevant regulatory developments moving forward.

Meanwhile, it should also be noted that none of the above local measures address the uncertainty on taxation issues. The above pilot programs only confirm that the tax payment certificate for the real estate transfer must be submitted as one of the supporting documents to apply for trust asset registration, but do not clarify the specific tax liabilities arising from said registration (including, for example, income tax, value-added tax, land value-added tax, deed tax and other taxes and surcharges that may arise from transfer of real estate to the trust). It remains to be seen whether additional regulations will clarify these uncertainties and further boost the development of trusts in China.

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Contact Information
Jason Wen
Senior Tax Consulting Director
Beijing
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jason.wen@bakermckenziefenxun.com

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