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EU Passes Regulation On Successions
Taxand Finland investigates to see what, if any, tax implications are involved.
Currently heirs and legatees to around 450,000 cross-border successions each year are faced with complex legal issues involving judicial systems in several states. The new regulation introduces 2 new principles for dealing with international successions.
First, if someone dies in a Member State that is not their home country, their succession will generally be dealt with under the law of the Member State where they last had their place of "habitual residence", by the courts and authorities of that Member State. This will avoid conflicts that could otherwise arise if several courts in different Member States declared themselves competent. "Residence" will be a matter of facts, and does not mean "domicile".
Second, the person drawing up a will also has the option of having his or her will read under the law of his or her Member State of origin. This will give EU citizens in general a new right, which is believed to be a major improvement, as it will allow anyone living abroad within the EU to retain close links with their home country and ensure that specific national provisions, such as rules governing gifts made during a lifetime, are respected.
The Regulation also introduces a European Certificate of Succession, which will constitute proof of the capacity of the heir or legatee and of the powers of the executors of wills or third-party administrators.