How to Set Up a Cook Islands Trust: The Application Process

Setting up a Cook Islands trust involves coordination between three parties: the settlor, U.S. legal counsel, and the licensed Cook Islands trustee company. The process is sequential rather than parallel. Each stage depends on the completion of the one before it, and delays at any point affect the overall timeline. Most trusts take four to eight weeks from initial engagement to funded structure, though banking and asset transfers can extend that period significantly.

This article describes what happens at each stage, what each party is responsible for, and where the process most commonly slows down.

Stage One: Initial Consultation and Planning

The process begins with a consultation between the settlor and U.S. legal counsel. The purpose of this meeting is to determine whether a Cook Islands trust is appropriate for the settlor’s situation and, if so, how the structure should be designed.

The attorney evaluates several factors during this stage. These include the nature and value of the assets to be protected, the settlor’s current and anticipated litigation exposure, whether any creditor claims or lawsuits are pending or reasonably foreseeable, the settlor’s solvency position after the proposed transfer, and whether domestic planning alternatives might achieve comparable protection at lower cost. This last question matters because a Cook Islands trust is expensive to establish and maintain, and it is not the right tool for every client. For married settlors, the consultation also addresses whether assets are marital or separate property and whether both spouses should be involved in the trust structure. The setting up while married article covers these considerations in detail. The consultation should produce a clear recommendation about whether to proceed and, if so, what the trust structure should include.

If the decision is to proceed, the attorney will outline the proposed structure. For most clients, this involves a Cook Islands trust owning an offshore LLC, with the LLC holding bank or brokerage accounts. The attorney identifies which trustee company to approach, whether a protector should be appointed, and how the trust deed should be customized for the settlor’s circumstances. The trust agreement article describes the key provisions that get addressed during this planning stage.

This stage typically takes one to three days if the settlor has organized financial information readily available.

Stage Two: Trustee Application and Due Diligence

Once the structure is designed, the next step is applying to the Cook Islands trustee company for acceptance. The trustee does not automatically accept every client. Cook Islands trustees are licensed by the Financial Supervisory Commission and are required by law to conduct due diligence on every proposed trust before agreeing to serve as trustee.

The application package submitted to the trustee typically includes the completed trust registration form identifying the settlor, proposed beneficiaries, protector, and initial trust assets. It also includes certified copies of the settlor’s passport or government-issued identification, original proof of residential address (a recent utility bill, bank statement, or similar document), source of funds documentation explaining how the settlor acquired the assets to be transferred, a professional reference letter from the settlor’s attorney or financial advisor, and bank reference letters from institutions where the settlor maintains accounts.

The trustee reviews this information to satisfy its obligations under Cook Islands anti-money laundering and know-your-customer regulations, as well as its commitments under the Common Reporting Standard and FATCA. The KYC and AML requirements article explains what the trustee is evaluating, what documentation it expects, and what causes delays.

This stage is where the process most frequently stalls. Delays occur when documentation is incomplete, when source of funds explanations are insufficient, or when the trustee’s compliance team identifies issues requiring additional information. Common problems include identification documents that are not properly certified by a notary, proof of address documents that are photocopies rather than originals, source of funds explanations that describe current holdings without explaining how those holdings were originally accumulated, and missing or outdated bank reference letters.

If the documentation is complete and the trustee’s compliance review raises no concerns, this stage takes one to two weeks. If the trustee requests supplemental information (which is common), it can extend to three or four weeks depending on how quickly the settlor and counsel respond.

Stage Three: Trust Deed Drafting and Execution

While the trustee conducts its due diligence review, U.S. counsel drafts the trust deed. This work can proceed in parallel with stage two because the deed does not need to be finalized before the trustee completes its review, but it does need to be finalized before the trust can be registered.

The trust deed is customized for each client based on the planning decisions made during stage one. The attorney drafts the deed and circulates it to the settlor for review. Depending on the settlor’s circumstances, the deed may include specialized provisions such as a Jones clause addressing existing creditor obligations. Once the settlor approves the terms, the attorney also sends the deed to the trustee company for review. The trustee will confirm that the deed’s provisions are consistent with its operational practices and Cook Islands regulatory requirements. Trustees routinely request modifications to provisions they consider problematic, such as reserved powers that are broader than the trustee is comfortable administering, or distribution provisions that conflict with the trustee’s internal policies.

This collaborative review between U.S. counsel and the Cook Islands trustee is a normal part of the process. The trust agreement article discusses the key provisions and how drafting quality affects protection.

Once the deed is agreed upon by all parties, it is executed. The settlor signs in the United States. The trustee signs in the Cook Islands. Cook Islands law permits execution in counterparts at different times and locations, so physical presence in the Cook Islands is not required. Along with the trust deed, the settlor executes several ancillary documents: the affidavit of solvency (confirming that the transfer will not render the settlor insolvent), the letter of wishes (providing non-binding guidance to the trustee about distributions and administration), and any protector appointment documents.

Trust deed drafting and execution typically takes one to two weeks if there are no significant disagreements between counsel and the trustee about the deed’s terms.

Stage Four: Trust Registration

After the deed is executed and the trustee has completed its due diligence, the trustee registers the trust with the Cook Islands High Court Registry. Registration requires submitting the executed trust deed, the trustee’s statutory declaration, and payment of the registration fee. The trust becomes legally effective upon registration.

The registration itself is administrative and typically completed within a few business days once all documents are in order. The trustee receives a certificate of registration confirming the trust’s existence and the date of its establishment.

The trust deed is not a public document. The Cook Islands does not maintain a public registry of trust deeds or beneficiary information. Section 14 of the International Trusts Act makes unauthorized disclosure of trust information a criminal offense. The only publicly accessible information is the fact that a trust with a particular name has been registered—the parties, terms, and assets are not disclosed.

Stage Five: Entity Formation

If the trust structure includes an offshore LLC—which is the case for most asset protection trusts—the LLC is formed after the trust is registered. The LLC is typically formed in the Cook Islands or in Nevis, depending on the structure chosen during stage one.

Formation requires filing organizational documents with the relevant registry, appointing a registered agent, and preparing an operating agreement that governs the LLC’s management and ownership. The trust is listed as the sole member of the LLC. The settlor is typically appointed as the initial manager, with the trust deed providing that the trustee assumes the manager role upon a defined triggering event such as the commencement of litigation.

Entity formation usually takes one to two weeks depending on the jurisdiction and the registered agent’s processing time.

Stage Six: Account Opening and Funding

The final stage—and frequently the longest—is opening bank or brokerage accounts in the name of the trust or its LLC and transferring assets into the structure.

Account opening requires the trust or LLC to undergo a second round of due diligence, this time by the financial institution. Banks and brokerages apply their own KYC and AML procedures, which may overlap with but are not identical to the trustee’s requirements. The financial institution will typically require copies of the trust deed and LLC operating agreement, identification documents for the settlor and any authorized signatories, source of funds documentation, the trustee’s certificate of registration, and completed account opening forms specific to that institution.

Offshore banks have become increasingly rigorous in their onboarding procedures over the past decade. Institutions that once opened accounts in days now routinely take four to six weeks, and some take longer. Delays are common when the bank’s compliance department requests information the settlor has already provided to the trustee but in a different format, or when the bank requires additional documentation not previously gathered. U.S. counsel and the trustee typically coordinate with the bank to resolve these requests, but the settlor’s involvement is often required to provide updated or supplemental information.

Once accounts are open, assets are transferred into the structure. For liquid assets—cash and publicly traded securities—this involves wire transfers and brokerage account transfers. For other asset types, the transfer process is more complex. The funding section and its individual articles on bank accounts, stocks and investments, real estate, and LLC interests address the mechanics of transferring specific asset types.

Account opening and funding is the most variable stage. For a straightforward structure with one offshore bank account funded by a wire transfer of cash, it can be completed in two to four weeks. For structures involving multiple accounts, brokerage transfers, or non-liquid assets, it can take two months or longer.

What Determines the Overall Timeline

The total time from initial consultation to funded trust depends primarily on three factors: how quickly the settlor provides complete documentation to the trustee, whether the trustee’s due diligence review raises issues requiring additional information, and how long the chosen bank takes to open accounts.

The legal work—planning, drafting, and execution—rarely causes delays. Attorneys can typically complete their portion of the work within two to three weeks. The trustee’s compliance review adds one to three weeks depending on the completeness of the application. Banking adds another two to six weeks.

For a client with organized financial records, straightforward source of funds, and no complicating factors, the entire process from engagement to funded trust can be completed in four to six weeks. For clients with complex asset profiles, multiple accounts, or documentation that requires supplemental explanation, eight to twelve weeks is more realistic.

For information about the costs associated with each stage, see the cost overview. For a comprehensive overview of Cook Islands trust planning, return to the Cook Islands trust overview.