Multiple wives, mistresses or girlfriends is a universal problem
Patricia Woo, of counsel, Squire Patton Boggs in Hong Kong, says that when it comes to resolving family conflicts related to succession planning, the key is to come up with an equitable mechanism that makes everyone feel they are treated fairly.
What changes do you see in Chinese UHNW immigration to the UK and the US?
The UK and the US remain two popular destinations for Mainland Chinese as they offer quality education and a desirable living environment with clean air and safe food. Hong Kong has passed the pre-1997 peak of emigration. The UHNW population in Taiwan has perhaps the highest percentage of UK and US passport holders, but the trend is to give them up for tax reasons.
What are the issues around succession planning?
The key issue around succession planning is essentially the lack of it. Situations where a patriarch has multiple wives, mistresses or girlfriends is a universal problem. We have seen a number of cases taken to court, but there are many others that are dealt with privately. The key, really, is to anticipate potential disagreements and come up with a more equitable and reasonable mechanism that makes people feel they are treated fairly. Well-designed and well-documented structures are important. Sometimes, each wife or girlfriend is given her own family office so that their affairs are segregated. Sometimes, a family office centralises the affairs of the girlfriends or mistresses and attempts to harmonise the relationships between children from different partners.
What are the gender issues in China at the moment?
We might see gender issues when it comes to who gets the inheritance or control of the family business. Money and power used to be passed on more to sons than daughter, but recently I have noticed that the heads of the family offices that I set up are not necessarily male. Taiwan still has a higher inclination to pass more of the wealth to male descendants than female ones. In Hong Kong it is not the case.
Do you find yourself advising your clients about philanthropy or charitable projects?
Yes. Some family offices start with philanthropy. Even for investment-centric family offices, I make sure the family’s charitable aspiration is discussed at the outset when we determine the family’s cash flow needs.
Tell us about passion investment in China.
Many clients of mine have a real passion for art. They put in much money and effort not only in building their own private collections from paintings to massively scaled installation arts, but also in education and philanthropy. I have also seen interest in popular collectibles, like jades, porcelains, maps, stamps, furniture, jewellery and watches.