Protector vs Trustee

If you are weighing protector vs trustee for a Mauritius trust, the short answer is that they do different jobs. The trustee owns the trust property in law and runs the trust day to day. The protector sits alongside, advises the trustee and, if the deed says so, holds a few powerful checks over it. Neither role replaces the other, and the same family can need both.

This page sets the two side by side. For a full treatment of one role, see the trust protector overview or the duties of a trustee toward the family.

The core difference in one paragraph

The trustee acts. It receives the assets, invests them, keeps accounts, decides (or carries out) distributions and answers to the beneficiaries and, in the end, to the court. The protector watches and advises. Under article 24 of the Trusts Act 2001, a trust may provide for a protector, an adult (the settlor included) or a legal person, whose task is to advise the trustee. Unless the deed says otherwise, the protector can remove and appoint trustees, set the law governing the trust, change the place of administration and withhold consent to certain acts, without becoming a trustee.

That last phrase matters. A protector who steps into day-to-day administration risks blurring the line between the two roles, which is one reason deeds are drafted with care.

Side-by-side comparison

Duties: who has to do what

The trustee's duties

The trustee's duties are the heart of the trust. Among them, article 38(3) of the Trusts Act 2001 requires the trustee to keep up-to-date accounts and records, together with an alphabetical register of the names and last known addresses of each beneficiary and settlor. This covers a non-resident foreign trust that the trustee administers. Accounting records are kept for at least 5 years after the operations concerned are completed.

The trustee also keeps trust information confidential. Under article 33, as rewritten in 2019 and in force since 29 May 2019, the court orders disclosure only at the request of an investigating authority, and only where the information is required in good faith for an investigation or trial relating to a financial crime.

A trustee that is a regulated firm has further obligations. Entities acting as qualified trustees are reporting persons under the FIAMLA, so they apply customer due diligence and report suspicious transactions. A trustee of an express trust must also declare that capacity to a reporting person such as a bank when forming a business relationship or carrying out an occasional transaction of at least Rs 500 000 or the equivalent in foreign currency.

The protector's duties

The statute does not give the protector a long list of administrative tasks. The role is mostly what the deed makes it. In practice a protector is expected to be available to the trustee for advice, to use the powers the deed grants, and to consider whether to use them when something goes wrong. The deed should say clearly whether those powers are optional or whether the protector must act in some situations. If you are still deciding whether to have the role at all, read do you need a trust protector.

A protector has no right to run the trust. The powers are a check, not a management mandate.

Powers: where the roles meet and where they part

The trustee's powers are the powers needed to administer: holding, investing, applying income and capital, and distributing to beneficiaries within the deed. The protector's powers are usually negative or structural. The powers of a trust protector are described in a separate page, but the statutory default list in article 24 gives a good picture:

• removing and appointing trustees;
• setting the law that governs the trust;
• changing the place of administration;
• refusing consent to certain acts of the trustee.

The deed can narrow or widen these. The words "unless otherwise provided" in the default rule mean that the drafting decides the real scope.

A practical illustration

Take a family trust whose trustee proposes to move the administration of the trust to another jurisdiction. If the deed requires the protector's consent, the trustee cannot proceed without it. If the deed is silent on the point, the statutory default can still give the protector a say, unless the deed removes it. Two families with identical assets can therefore end up with very different balances of power, purely because of how the deed is written.

Liability: the least settled comparison

Liability is where the two roles differ most, and where the answer depends most on the facts.

The trustee is exposed when it fails in its duties. Breach of trust gives beneficiaries remedies, and a regulated trustee can also face supervisory consequences. Knowingly giving false customer due diligence information is an offence under the FIAMLA, punishable by a fine of up to Rs 500 000 and imprisonment of up to 5 years.

The protector carries less day-to-day exposure because it does not manage assets. But "less" is not "none". The extent of any duty or liability depends on the terms of the deed, on the powers the protector holds and on how it uses them. A protector who holds an active, discretionary power is in a different position from one who has only a veto. Anyone asked to accept the role should have the deed reviewed by an adviser first; this page cannot say how a court would treat a particular protector.

Can one person do both?

The statute does not forbid the same person from combining some roles, but it does separate others. Under article 8 of the Trusts Act 2001, the settlor may also be trustee, beneficiary, protector or enforcer, though not the sole beneficiary of the trust they created. By contrast, article 21 says that the same person cannot be both trustee and enforcer of one trust. The enforcer is a role specific to purpose trusts, which is distinct from the protector; see enforcer vs protector.

Whether a settlor should take the protector role is a design question, since too much retained control can raise questions about the trust itself. Two pages go into that: can the settlor be the protector and how much control a settlor can keep. On eligibility more generally, see who can be a trust protector.

How the two roles appear in compliance records

Both roles are visible to the authorities. Under the FIAMLA, the beneficial owner of a trust-type legal arrangement includes the settlor, the trustee, the protector if there is one, each beneficiary (or the class of beneficiaries and the objects of a power) and any other natural person exercising ultimate effective control, including through a chain of control.

The register of trusts kept by the FSC under article 26A of the Financial Services Act 2007 records, among other things, the identity and addresses of beneficiaries, trustees, settlors, protectors and enforcers, as well as the deed and its amendments, the governing law and the place of administration. A protector should therefore expect to be identified and documented, and should expect the trustee to ask for identification documents.

Choosing between the two: a short decision aid

You do not choose protector or trustee; every trust needs a trustee. The real question is whether to add a protector. This tree is a starting point, not advice.

Checklist before you appoint a protector

• Decide which powers the protector will hold and which stay with the trustee
• State in the deed whether each power is optional or mandatory
• Name a successor in case the protector dies or cannot act
• Check that the powers do not turn the protector into a de facto trustee
• Confirm what the protector will receive for acting
• Take advice on the settlor's own role before naming the settlor

If you later need to change the post-holder, how to replace a trust protector covers the mechanics.