The Concept Of “Beneficial Ownership” In Anglo-American Law and The Concept Of “Economic Ownership” In the Civil Law Systems of Continental Countries

The concept of “beneficial ownership” developed within the framework of equity law as a result of the evolution of trust-based legal relationships. It is a product of the “split” ownership model. The division of ownership into legal title (under common law) and beneficial title (under equity law) is rooted in the unique historical development of Anglo-American law. Within the trust framework, in accordance with the rules of equity, a beneficial owner acquires not only a personal (in personam) right against the trustee, but also a proprietary (in rem) right enforceable against third parties. In contrast to Anglo-American jurisdictions, countries belonging to the continental (civil law) system recognize the absolute nature of ownership and define the derived limited real rights at the level of national civil legislation. In the civil law of these countries, the concept of “economic ownership” exists, which refers to the owner granting another person the right to use the property and to derive income from it.