Non-Funded Trust Receives Institutional Support; Family Trusts May Achieve Full-Category Wealth Planning

Southern Finance and Media Reporter Lin Hanyi

Recently, China Trust Registration Co., Ltd. (hereinafter referred to as “CITR”) issued the “Notice on the Pilot Work of Movable Property Trust Property Registration” (Trust Registration [2026] No. 7, hereinafter referred to as the “Notice”), officially launching the pilot program for movable property trust registration.

This move is regarded as an important step for the trust industry to improve the trust property registration system and promote business to return to its core. However, several industry experts interviewed pointed out that while the pilot fills the gap in movable trust registration at the institutional level, its legal effectiveness and practical significance still require careful evaluation.

Addressing the Shortcomings of Non-Financial Trusts

The Notice clearly defines the scope of application, registration principles, procedures, and related requirements for the pilot.

The pilot adheres to the principle of voluntary participation. The document specifies that the scope of the movable property trust registration pilot is for trust businesses where trust institutions use movable property (excluding special movable assets such as ships and aircraft) as trust assets.

Regarding specific procedures, the Notice establishes processes covering initial registration, change registration, termination registration, and correction registration of trust property.

In the initial registration stage, trust institutions need to register the trust product initially and simultaneously apply to CITR for the initial registration of trust property, submitting signed trust documents and other application materials.

If new movable assets are added during the trust’s term, trust institutions must, based on the pre-registration and initial registration of the trust product, apply to the trust registration company for initial registration of the trust property.

When there are changes to the trust property registration information during the trust’s term, trust institutions, based on the pre-registration and initial registration, must apply for change registration.

When the relevant movable trust assets are no longer part of the trust or after the trust terminates, trust institutions, based on the pre-registration and initial registration, must apply for termination registration of the trust property.

A family office general manager of a trust company told 21st Century Business Herald that this pilot for movable trust property registration is a key measure by regulators to promote the trust industry’s return to its roots and improve the comprehensive trust property registration system, building on the results of real estate and equity registration pilots, and addressing the shortcomings of non-financial trust systems.

According to data from the China Trust Industry Association, as of the end of June 2025, the total trust assets in the industry reached 32.43 trillion yuan, an increase of 2.87 trillion yuan from the end of the previous year, a growth of 9.73%; compared to the same period last year, an increase of 5.43 trillion yuan, a year-on-year growth of 20.11%. Under the non-financial trust scope, the asset service trust balance (trust assets minus fund trust assets) is at least 8 trillion yuan, accounting for 24.67% of total trust assets.

From a business structure perspective, the “three categories” policy’s asset management trusts and asset service trusts have replaced the traditional “financing trust + channel trust” model, becoming the main business model driving the current (since 2021) growth of trust assets.

The aforementioned trust company family office general manager analyzed that the industry is shifting from financing channels to asset services, wealth management, and transaction management. The pilot provides institutional support for trust companies to expand real asset services and activate corporate movable assets, strengthening the independence and risk隔离 (isolation) functions of trust property, laying a foundation for the industry’s shift from scale expansion to high-quality development, and building a规范透明的 (standardized and transparent) trust ecosystem.

Disputes Over Registration’s Oppositional Effectiveness

Although the pilot is regarded as a significant institutional breakthrough by industry insiders, there are still debates about its legal effectiveness.

Generally, movable assets are divided into two types: one is special immovable assets, such as motor vehicles, ships, aircraft, etc.; the other is ordinary movable assets, such as liquor, gold and silver physical assets, antiques, machinery, etc.

According to Article 225 of the Civil Code of the People’s Republic of China, the establishment, change, transfer, and extinguishment of property rights for ships, aircraft, and motor vehicles, etc., must be registered; without registration, they cannot抵抗善意第三人 (oppose bona fide third parties).

Professor Zhao Lianhui, Director of the Trust Law Research Center at China University of Political Science and Law, analyzed that for special movable assets, the change of物权 (property rights) adopts a registration opposition system, which does not require mandatory物权登记 (property registration). The registration opposition system means that for special movable assets established as trusts, as long as appropriate public disclosure measures are taken and do not cause unreasonable信赖 (trust) or other negative impacts on善意第三人 (bona fide third parties), the trust can对抗第三人 (oppose third parties), mainly referring to the trust’s固有债权人 (innate creditors).

Dr. Yang Xiang, a think tank expert at the Guoke Innovation Research Institute, pointed out that movable trust registration mainly targets property types explicitly applicable under the “registration opposition” principle in the Civil Code’s property chapter, such as motor vehicles and aircraft. For these assets, legal effectiveness against third parties only occurs after completing property rights registration. For general movable assets, transferring ownership can usually be achieved through delivery and possession transfer, so registration is not typically required.

Yang Xiang further noted that only large special movable assets like aircraft and ships most need trust registration to抵抗第三人 (oppose third parties). However, even without trust registration for these assets, establishing the trust itself remains valid. The current “Notice” excludes these most-needed assets (aircraft, ships) from the pilot scope, making its practical significance limited. For other general movable assets, the law already applies the principle of “possession equals ownership,” so whether registered or not has little impact on ownership validity. From the perspective of the Trust Law, trust property registration is neither a condition for成立 (establishment) nor a requirement for对抗 (opposition).

However, Zhao Lianhui also pointed out that to enhance the公示 (publicity) effect of movable assets, regulatory authorities utilize reputable institutions like CITR to provide high-level services, offering trustees including trust companies a safer and more efficient means of property公示 (public disclosure).

Expanding Family Trust Service Boundaries

Although there are limitations in legal opposition effects, from the perspective of trust industry business model restructuring and strategic expansion, the introduction of movable trust property registration pilot is undoubtedly a “boost.”

Industry data shows that in recent years, the trust industry’s asset management scale has stabilized and rebounded, with a clear trend of “de-channeling and重服务 (re-emphasizing services).” In this wave of transformation, how to activate real enterprise movable assets and meet the increasingly diverse wealth inheritance needs of high-net-worth individuals have become key challenges for trust companies.

“Compared to real estate and financial assets, movable assets face long-term issues such as weak权属公示 (ownership publicity), difficulty in确权 (confirming rights), challenges in risk隔离 (isolation), and complex valuation and custody,” explained the trust company family office general manager in detail. She pointed out that the variety, rapid circulation, and lack of a unified registration platform for movable assets make it difficult to publicly disclose ownership, and assets like artworks and precious metals lack standardized鉴真 (authentication) and valuation standards.

In her view, the current pilot, built on CITR’s unified registration platform, clarifies registration effects and procedures, strengthens ownership公示 and对抗 (opposition) functions, and solves the problems of确权 and隔离 from制度层面 (system level). Unified registration shifts movable trust from mere agreement to确权 (ownership confirmation), clearing core obstacles for scaled and规范化 (standardized) development of movable trust业务, significantly improving operational feasibility and legal保障 (protection).

This breakthrough is especially significant in the practical field of family trusts. Public information shows that in China’s wealth management market, although there have been early explorations of including artworks, jewelry, and precious metals into family trusts, most remain at small-scale initial attempts.

“Long-term operational obstacles in family trusts include difficulty in movable asset registration,确权, and weak隔离,” emphasized the trust company family office general manager. She noted that the pilot provides a unified registration path, clarifies ownership and independence of movable trust assets, and achieves effective risk隔离, solving external proof and judicial recognition issues. The registration effect provides a solid保障 (guarantee) for intergenerational inheritance of movable assets, pre-marital property隔离, and charitable arrangements, supporting family trusts in combining movable and immovable assets and financial assets, enriching inheritance tools, and enhancing service completeness, helping high-net-worth clients realize comprehensive wealth planning.

Strengthening Trustee Responsibilities

Opportunities often come with challenges. The opening of the movable trust registration door not only broadens business space for trust companies but also imposes unprecedented strict requirements on their trustee capacity, risk control, and compliance levels.

The “Relevant Requirements” section of the Notice emphasizes core obligations and responsibilities for trust institutions engaging in such business.

The document specifies that assets proposed for trust inclusion must have clear ownership and no rights restrictions. Trust institutions should conduct due diligence on委托人 (trustor), the movable assets proposed for trust, and the trust’s目的 (purpose), ensuring the trust is established based on the trustor’s genuine intent, that the movable assets are legally owned by the trustor, and that the trust complies with laws and regulations, avoiding利用信托机制规避 (using trust mechanisms to evade) legal or regulatory policies.

Trust institutions must also commit to the真实性 (truthfulness),准确性 (accuracy),及时性 (timeliness), and完整性 (completeness) of the submitted materials and information related to trust property registration.

The “Letter of Commitment” in the附件 (attachment) further reinforces this, requiring applicants to承诺 (commit) to承担 (bear) all legal责任 (liability) arising from errors, inconsistencies, or incomplete information in their submissions.

The trust company family office general manager believes that trust companies’ responsibility for the真实性,准确性, and完整性 of registration information is a core arrangement to solidify trustee responsibilities and prevent虚假登记 (false registration), aligning with监管 (regulatory) transparency management.

Undoubtedly, this will significantly increase compliance pressure on trust companies. She stated that trust companies need to establish comprehensive due diligence mechanisms, verify the trustor’s qualifications, property rights, valuation, and transfer records, and improve document review, cross-verification, and ongoing updates.

Meanwhile, the physical characteristics of movable assets also pose substantial operational risks. Yang Xiang reminded that even after trust registration, the nature of movable assets makes them difficult to control effectively. During subsequent transfers,交易相人 (transacting parties) often do not proactively verify whether the assets have undergone ownership or trust registration changes.

The trust company family office general manager summarized three major risks in the pilot’s implementation: first, policy coordination risks, as the legal effectiveness of movable trust registration with judicial and tax systems is not yet fully clear; second, operational risks, given the difficulty of鉴真 (authentication), valuation, and custody of movable assets, which may lead to disputes during the trust’s term; third, compliance risks, as the increased责任 (liability) for information commitments means any due diligence flaws could lead to regulatory penalties.