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Employee benefit trust and pre-IPO trust services
An employee benefit trust holds company shares or cash for employees under a share scheme, and a pre-IPO trust holds founders' shares through a listing. We act as trustee: we hold the shares, keep the register of awards and transfer shares to employees when the scheme rules say so.
Who it is for
Companies and founders who need a trustee for shares
- Companies preparing to list in Hong Kong, Singapore or the United States that need a trustee for a share scheme
- Listed companies with a share award or share option scheme that uses a trust
- Founders and early shareholders who want to hold their shares in a trust before the listing
- Company secretaries, legal counsel and share-plan administrators
How it works
How the trust runs, from the scheme rules to the transfer
Read the scheme rules
Your counsel drafts the scheme and the trust deed under the listing rules that apply. We confirm what the trustee must do and hold.
Onboard the company and the trust
Company documents, authorised persons and the funding arrangement. We open the trust account and the share register.
Take the shares
The company issues or transfers shares to the trust, or funds the trust to acquire them under the scheme rules.
Record awards and vesting
We keep the register of awards, vesting dates and conditions as the scheme administrator instructs.
Transfer or hold
On vesting we transfer shares to employees, or hold them on the terms the scheme sets. We report to the company for its disclosures.
In detail
How an employee benefit trust works
In practice, employee benefit trusts work like this: the company, or a shareholder, puts shares or cash into the trust. The trustee holds them separately from the company’s own assets.
When an award vests, the scheme administrator instructs the trustee, and the trustee checks the instruction against the scheme rules and the deed before it transfers the shares to the employee.
Holding the shares in a trust keeps them in one place between the grant and the vesting date, and keeps a clear record of who is entitled to what.
Our role
What we do, and what we do not do
Your counsel advises; we hold and record.
What we do
- Act as ESOP trustee for employee benefit, share award and pre-IPO holding trusts
- Hold the shares and the scheme cash in the name of the trust
- Keep the register of awards, vesting schedules and transfers
- Act on instructions from the scheme administrator or remuneration committee within the scheme rules
- Provide the records the company needs for its listing rule disclosures and audits
- Coordinate with the share registrar, broker and company secretary
What we do not do
- Decide who receives awards or how many. The company and its committee decide under the scheme rules.
- Trade the shares for return or advise on when to sell. Sales happen only as the scheme or the deed instructs.
- Give legal advice on listing rules, securities law or tax in any market. Your counsel does that.
- Hold shares for a purpose the listing rules or the scheme do not allow.
Documents and timeline
Documents and timeline
- Scheme rules, trust deed and the board or shareholder approvals
- Company constitutional documents and the list of authorised persons
- Identity and address for the directors and controlling persons of the settling company
- Funding agreement and the share issue or transfer instruments
- For each founder settlor: identity, source of wealth and tax self-certification
The trust is usually in place before the scheme is adopted or before the listing timetable needs it.
Our onboarding runs alongside your counsel’s drafting; vesting and transfers follow the scheme calendar.
FAQ
Questions companies ask about share scheme trusts
What is an employee benefit trust?
The trust is a way to reward and retain staff with shares, usually under a share option or share award scheme. A trustee holds the shares until they vest and passes them on as the scheme rules say. The deed and the scheme rules set the terms.
How does an employee benefit trust work?
The company funds the trust and the trustee holds the shares. The register of awards is the trustee’s working record: for each employee it shows the award, the vesting date and any condition. On vesting the scheme administrator instructs, and the deed and the scheme rules set every step.
Which rules govern a share award scheme in Hong Kong?
Start with Chapter 17 of the Main Board Listing Rules, covered earlier on this page. Shareholder approval, the scheme rules and the deed then fix what the trustee may hold and do. Your counsel confirms how they apply to your company, and we act on them.
Can the trust hold shares before the IPO?
Yes. Timing is the main question: the trust is best settled early in the listing timetable, so that counsel can see who holds the shares at every step. Lock-up and disclosure duties come from the listing rules, and your counsel confirms who is bound by them and for how long.
Who instructs the trustee on awards?
The scheme administrator or committee the deed names. We check that each instruction is within the scheme rules and the deed before we act. The company, not the trustee, decides who receives awards and how many. We keep the register and give the company the records it needs.
Where we work
Related jurisdictions
Singapore
Asia Pacific. We work alongside a local partner who takes a defined role in the trust.
See SingaporeCayman Islands
Americas and Caribbean. We work alongside a local partner who takes a defined role in the trust.
See Cayman IslandsUAE (DIFC, ADGM)
Middle East and Africa. We work alongside a local partner who takes a defined role in the trust.
See UAE (DIFC, ADGM)Sources
- HKEX Listed Issuers newsletter, December 2022, read 2026-11-06.
Set up a trust for your share scheme
Share the scheme outline and the listing timetable. We tell you what the trustee needs and when.