For those interested in the s 43 (2) and (4) ITA phenomenon, the devolution to Scotland of its own “sovereign” land registration duty has required the Scots to remove the kilt from the wee beastie known as the proper liferent.
Apart from consulting Gordon’s Scottish Land law or the Stair Memorial Encyclopaeda, the Registers of Scotland Manuals, the registration process for a Proper Liferent over Land in Scotland is set out as of 8th December 2016 at https://rosdev.atlassian.net/wiki/display/2ARM/Liferent±+Detail.
I would like to qualify if not correct my prior comment above.
What is clear is that the proper liferent can be established either by a conveyance of the land to the liferenter, under the reserve of the Fiar’s rights at the termination of the Liferent, or by the Grantor creating it and retaining the Liferent himself. These are convention, as opposed to legal proper liferents.
The Liferenter is registered on the Scottish register of title, as is the fiar:
"The party who has the use of the subjects is the ‘liferenter’. The Latin phrase salva rerum substantia (without encroaching on the substance) applies to the liferenter’s use of the subjects, indicating that the liferenter is not totally free to exploit the subjects as an owner can. The ‘fiar’ is the party who gains possession of the subjects once the liferent terminates. The word ‘fiar’ derives from the word ‘fee’, which in most other aspects of conveyancing practice means full ownership. Confusingly, in the context of liferents, ‘fee’ has a more limited usage, describing only the position of the fiar.
A fiar, under a liferent and fee title, has a registrable interest in the property but, because of the existence of the liferent, cannot occupy the subjects. The liferenter will be the occupier."
The creation therefore follows similar, but not identical procedures as to its creation as the French usufruit, which also has to be distinctly registered as such on the French conveyance.
Moving from Land, which is the main reference for property laws anywhere.
It would be interesting, in the French trust scenario and deeming context to see if a Scottish proper liferent over a Scottish investment portfolio, can be substituted so as to transform a trust or improper liferent into a vehicle which would more closely resemble a usufruit or quasi-usufruit over an investment portfolio to take the entire matter out of the somewhat ill conceived French fiscal definition of a trust -for tax purposes- with the declaratory inconvenience and proprietary dislocations it causes.
I stress that usufruits and quasi-usufruits over movables are not subject to the same punitive régime, as they are the diable that the French know, and can accommodate a gérant of any indivision beneath the usufruit in lieu of a trustee.
There are a number of conventional proper liferents which are coming to light in France, owing to emigration to warmer climes, and the Scots might wish to start adjusting their vehicles from improper to proper to cater for that.
I stress that the honeymoon period for non-declaration of trusts has finished in France, and that tax inspectors are attempting to make the most out of the punitive penalty régime before it is declared unconstitutional.
Peter Harris