Cook Islands Trust Formation
A Cook Islands trust is an asset-protection trust registered under the International Trusts Act 1984 and held by a licensed Cook Islands trustee company. It suits a US professional with no claim filed against them. Government registration is USD 310, a licensed trustee’s published all-in first year is USD 3,510, and registration must be filed within 45 days.
Those two figures are the Cook Islands layers, the government fee and the licensed trustee’s fee. They are not our service fee, which we quote after the eligibility check below.
What a Cook Islands International Trust actually is
A Cook Islands International Trust is a trust registered with the Cook Islands Financial Supervisory Commission under the International Trusts Act 1984. Legal title to the assets passes to a licensed Cook Islands trustee company. Questions about the trust are heard in the High Court of the Cook Islands under Cook Islands law.
You settle assets on the trust. The trustee holds them for the beneficiaries you name. What you get for the money is a statutory limitation period, a standard of proof set against a creditor, and a rule about which court hears the dispute. It is not a wall around your money, and the sections below set out exactly where it stops.
Two things it is not. It is not a company, so it does not trade, invoice, or hold a corporate bank account in its own right. Many settlors pair it with a Cook Islands LLC that holds the assets while the trust holds the LLC. It is not a tax structure either. For a US person there is no tax deferral and no tax reduction, and the reporting section below sets out why.
Fees verified 7 August 2026.
Two dates, not one: 1984 and 1989
The Act everyone cites is the International Trusts Act 1984, assented on 27 December 1984. The base Act runs 29 sections in five Parts, and it contains no asset-protection provisions at all. The machinery the market means when it says “Cook Islands trust” arrived five years later.
Section 6 of the International Trusts Amendment Act 1989 (No. 23) inserted sections 13A to 13I: bankruptcy, fraud, retention of control, foreign judgments, heirship, spendthrift provisions, governing law, and the exclusion of foreign law. The insertion stops at 13I. Sections 13J and 13K came later, added by sections 4 and 5 of the International Trusts Amendment Act 1991 (No. 32).
| Year | Act | What it did |
|---|---|---|
| 1984 | No. 14 | the base Act, 29 sections, no asset-protection provisions |
| 1985 | Regulations No. 7 | forms and fees, subsidiary regulations rather than an amending Act |
| 1989 | No. 23 | s.6 inserts ss.13A–13I, the asset-protection core |
| 1989 | No. 31 | substitutes s.13B(3)(b), the one-year creditor window |
| 1991 | No. 32 | inserts s.13J and s.13K; disapplies the Statute of Elizabeth |
| 1995-96 | No. 25 | substitutes s.13D, s.14, s.6; adds the s.13B(3) proviso and the s.13K security rule |
| 1999 | No. 3 | excludes punitive and multiplied damages |
| 2004 | No. 7 | replaces s.23 with "Privacy"; carves the criminal statutes into the Schedule |
| 2013 | No. 15 | inserts the s.27C record-keeping duty |
Sources that cite only “1984” describe an Act without the provisions they are selling. Sources that cite only “1989” miss the 1991 additions and the 1995-96 rewrites. Both halves matter, and you can read the chain yourself on the FSC legislation index.
The two-year rule, quoted from the section that contains it
Section 13B(3) sets the limitation period. A settlement is not treated as fraudulent against a particular creditor if it happened more than two years after that creditor’s cause of action accrued. If it happened inside two years, the creditor still loses the point unless it starts proceedings within one year of the settlement.
The words themselves, as substituted by the 1989 Amendment (No. 2) Act:
“where settled, established or the disposition takes place before the expiration of 2 years from the date that the creditor's cause of action accrued, that creditor fails to commence such action before the expiration of 1 year from the date such settlement establishment or disposition took place.”
| Timing of the settlement | The creditor’s position |
|---|---|
| More than 2 years after the cause of action accrued | not fraudulent as against that creditor, s.13B(3)(a) |
| Within 2 years, and the creditor does not sue within 1 year of the settlement | not fraudulent as against that creditor, s.13B(3)(b) |
| Proceedings already commenced when you settled | s.13B(3) does not apply at all, proviso added 1995-96 |
Two further rules sit behind that table. A creditor must prove your principal intent to defraud beyond reasonable doubt, under section 13B(1). The onus of proof lies on the creditor, under section 13B(7).
The timing is the product. Settle before anything is pending and the statute does the work. Settle after a claim is filed and the statute expressly steps aside.
What else the Act does: the forum wall
Six provisions do the rest of the work, and none of them stops a court in your own country from hearing a case against you.
| Provision | Effect |
|---|---|
| s.13D | a foreign judgment is not entertained, recognised or enforced in the Cook Islands to the extent it applies inconsistent law or a matter governed by Cook Islands law |
| s.13B(13) | a creditor relying on a foreign judgment must first show it exhausted all remedies against your remaining property and all rights of appeal |
| s.13B(14)–(16) | punitive, exemplary, vindictive and multiplied damages are excluded from any award |
| s.13E | a forced-heirship claim does not void the trust |
| s.13F | spendthrift provisions are enforceable |
| 1991 Act s.6 | the Statute of Elizabeth of 1571 has no application to an international trust |
| s.6, as substituted | no rule against perpetuities; a 100-year term applies only where the trust would otherwise be void for uncertainty |
Read together these are a forum rule and a choice-of-law rule. They govern what a Cook Islands court will do with a foreign judgment. They do not remove a US court’s jurisdiction over you personally, and the case-law section below shows exactly what that distinction cost two settlors.
The gate a creditor must pass, and the bond that is not in the Act
Section 13K requires an action to set aside a settlement to be brought in the High Court of the Cook Islands, within two years of the settlement or disposition. Before the Court makes any order at all, including an injunction, an Anton Piller order or a Mareva injunction, it must first be satisfied beyond reasonable doubt on the plaintiff’s affidavit that the action is not precluded.
Section 13K(4)(c) then requires that affidavit to address the circumstances relevant to determining “the quantum of security to be paid by the plaintiff”. A creditor therefore faces security for costs, in an amount the High Court of the Cook Islands determines.
There is no figure in the statute. The widely repeated claim that a creditor must post a USD 100,000 bond does not appear in the International Trusts Act 1984 or in any of the seven Acts that have amended it since, in 1989 twice, 1991, 1995-96, 1999, 2004 and 2013, all of which we read for this page. The likely origin is Nevis trust law, where a statutory bond genuinely exists. We do not restate the Nevis figure either, because we have not verified it at source.
Who can be the trustee, and why there is no do-it-yourself version
Section 2 requires at least one trustee to be a registered foreign company, an international company, or a trustee company. Trustee companies are licensed by the FSC under the Trustee Companies Act 2014. As at 7 August 2026 there are ten of them on the FSC register of licensed trustee companies.
The consequence for your budget is worth saying plainly: there is no do-it-yourself tier at any price. You cannot be your own Cook Islands trustee, and the licensed trustee is not an upsell we have added. It is the statutory entry requirement, and its annual fee is the largest line in the Cook Islands cost.
One naming point that confuses buyers. Cook Islands Trust Corporation Limited is the name of one of the ten licensees, not another word for the instrument. A private trustee company is a separate route, and it changes both the cost and the governance.
Who can be a beneficiary: the rule that disqualifies some readers
Section 2’s definition of an international trust requires that the beneficiaries are at all times non-resident. Not non-resident at settlement. Non-resident at all times. If a beneficiary becomes resident in the Cook Islands, the trust stops meeting the statutory definition.
This is a hard rule rather than a preference, and it is the first thing our free eligibility check tests.
What a Cook Islands trust costs, decomposed
Registration costs USD 310 and annual renewal costs USD 310. Add the mandatory licensed trustee, and one licensed trustee’s published all-in first year is USD 3,510, renewing at the same figure. Everything above that number in the market is legal drafting and coordination, not a Cook Islands charge.
| Line item | First year | Annual renewal |
|---|---|---|
| Cook Islands government, registration, Form ITA/2 | USD 310 | — |
| Cook Islands government, annual renewal, Form ITA/4 | — | USD 310 |
| Licensed trustee company, annual trustee fee | from USD 3,190 | from USD 3,190 |
| Cook Islands total | USD 3,510 | USD 3,510 |
| Annual accounts, up to 5 transactions, optional | USD 350 | USD 350 |
| FATCA and CRS filing, optional | — | USD 200 |
| Form 3520-A filing assistance, optional | — | USD 200 |
| Professional protector, including deed review, optional | USD 2,500 | USD 2,500 |
| Bank account introduction, optional | USD 1,000 to 1,500 | USD 200 |
| Change of trustee later, optional | USD 550 | — |
The government rows come from the FSC schedule of prescribed forms and fees, which you can check yourself in about a minute. Note that the fees are denominated in US dollars, not New Zealand dollars, which is easy to get wrong for a jurisdiction in free association with New Zealand.
The trustee rows come from the only licensed Cook Islands trustee that publishes a schedule, dated 17 October 2022 and inclusive of 15% Cook Islands value-added tax. That is a single source, and we say so rather than presenting it as a market rate. Treat the figures as a floor rather than a quote. Trustee fees vary by trustee and by how complex your assets are, and a four-year-old schedule is a starting point for a conversation, not a price you should rely on.
Google’s AI Overview for this search currently answers USD 15,000 to USD 30,000 to set up, and concedes in the same breath that the government filing fees are “usually bundled into the initial trustee onboarding fee”. The government fee is USD 310, published, and linked above. Across one page of search results the published figures for the same product cluster between USD 10,000 and USD 75,000, with one firm quoting USD 25,000 flat and another writing that it has seen fees reach USD 250,000.
We are not claiming those firms overcharge. Most of that money buys US legal work, and the next section explains when you should pay for it. We are saying you should know which part of the bill is the Cook Islands and which part is the lawyering, because only one of the two is fixed by statute.
Our own coordination fee is quoted after the free eligibility check, once we know whether you qualify and what the trustee will need. See full pricing for the rest of our price list.
Fees verified 7 August 2026.
Cook Islands trust versus hiring a US asset-protection attorney
The real decision is not whether to use a trustee, because the statute settles that. The decision is how much US legal work to buy alongside a Cook Islands cost that barely moves.
| Cook Islands side, mandatory | US attorney drafting, optional | What we do | |
|---|---|---|---|
| What you are buying | registration, a licensed trustee, the statutory limitation period, the forum rule | a deed drafted against your own facts and a fraudulent-transfer analysis under your state's law | the eligibility check, the trustee introduction, the paperwork, the reporting calendar |
| Legally required | yes, s.2 and the Trustee Companies Act 2014 | no | no |
| Published cost | USD 310 government plus from USD 3,190 trustee | USD 12,000 to USD 75,000 published; one firm USD 25,000 flat; one three-tier offer at USD 10,000 to USD 12,000 | quoted after the eligibility check |
| What it does not cover | anything governed by your home law: fraudulent transfer, contempt, your tax | the Cook Islands fees, which are additional | legal advice, because we are not a law firm |
| When you should not skip it | never, it is mandatory | when a claim exists or is foreseeable | — |
If a claim has been filed against you or is foreseeable, the US legal analysis is the part that decides the outcome. In re Lawrence was lost on Florida law, and no Cook Islands provision touched it. If nothing is pending and you are structuring in advance, the mandatory Cook Islands cost is USD 3,510 a year and the rest is a choice you should make with the numbers in front of you.
Setup timeline and the documents you send
Two clocks come from the statute, and both are worth knowing before you start.
Section 14 requires the application for registration to reach the Registrar, on Form ITA/2 and with the prescribed fee, within 45 days of the date a trustee company is appointed or declared trustee. The Registrar may extend that period where the failure was through inadvertence.
A trust registered within 30 days of being settled is deemed registered at the time it was settled, under section 15(4). That retroactivity is what makes the two-year period in section 13B run from settlement rather than from registration.
Section 16(3) requires the renewal application on or before the expiry date of the last certificate, on Form ITA/4. Where registration is renewed after the Registrar has given notice, section 16(6A) allows a further fee.
We do not publish a formation timeline in weeks. The figures circulating in this niche have no primary source behind them, and the part that actually takes time is the trustee’s own due diligence. Your trustee sets that timeline and confirms it in writing before you pay any fee.
What you send:
- Source-of-funds and source-of-wealth evidence, this one is a legal requirement, imposed by the Trustee Companies (Due Diligence) Regulations 1996
- A certified copy of the passport of the settlor and of each beneficiary
- Proof of address dated within the last three months
- A schedule of the assets you intend to settle
- The trust instrument
- The formation documents of the Cook Islands LLC, where one will hold the assets
Only the first item is set by regulation. The rest is standard due diligence that every licensed trustee asks for, and the certification standard, meaning who has to witness or notarise what, is set by the trustee you appoint rather than by the Act. We confirm it in writing before you have anything notarised.
What the courts have actually held
Two reported cases carry almost all the useful law here, and one of them is routinely attributed to the wrong jurisdiction.
Federal Trade Commission v Affordable Media, LLC, 179 F.3d 1228 (9th Cir. 1999) is the genuine Cook Islands case. The Andersons settled a Cook Islands trust whose deed contained an event-of-duress clause. When the district court ordered the assets repatriated, the trustee treated the order as an event of duress, removed the Andersons as co-trustees, and refused to comply. Their impossibility defence failed, and the reason is the whole lesson: the Andersons were the protectors of the trust, so the court found they retained the power to compel repatriation. The Ninth Circuit added the line that has been quoted ever since:
“While it is possible that a rational person would send millions of dollars overseas and retain absolutely no control over the assets, we share the district court’s skepticism.”
The point nobody draws out is that the case did not turn on Cook Islands law at all. It turned on who held the protector’s power. Section 13C expressly permits you to keep seven kinds of power, including the power to remove and appoint a trustee or protector, without the trust being invalid. So the Cook Islands statute lets you retain control, and a US court will then use that retained control against you. The two bodies of law point in opposite directions, which is precisely the question to take to a US attorney before you sign anything.
In re Lawrence, 279 F.3d 1294 (11th Cir. 2002) is the case most often attributed to the wrong jurisdiction, because it is not a Cook Islands case at all. The Eleventh Circuit’s published opinion records that the rights and obligations of the trust “were governed by Florida law, not the law of Mauritius, which is the law chosen by the Trust documents”. The Cook Islands appears in the opinion only where the court discusses Affordable Media. Lawrence was fined USD 10,000 per day, his duress amendment was held void under Florida law, and his impossibility defence failed partly because it was self-created.
The same opinion sets a limit that the sales literature leaves out. Civil contempt must stay coercive rather than punitive, and although “incarceration for civil contempt may continue indefinitely, it cannot last forever”, so it must be reconsidered at reasonable intervals. The case reports and the Federal Trade Commission’s own case record are the sources to read, not a summary written by a firm selling the structure.
Where the protection stops
Section 21 provides that no other enactment imposes liabilities or filing obligations on an international trust, except the Acts set out in the Schedule to the Act. The 2004 amendment added the Crimes Act 1969, the Proceeds of Crime Act 2003, the Financial Transactions Reporting Act 2003, the Mutual Assistance in Criminal Matters Act 2003, the Extradition Act 2003 and the Terrorism Suppression Act 2004 to that Schedule.
In plain terms, this is a civil-creditor wall. Criminal process, anti-money-laundering reporting and mutual legal assistance between governments are expressly carved into it.
Three more limits belong on the same list.
Section 23 is headed “Privacy”. The 2004 amendment repealed the old section and substituted a new one under that heading. Disclosure is an offence, subject to five stated exceptions including a court order, discharging a duty under any Act, and a search warrant. Proceedings other than criminal ones are heard in camera. Section 23(4) then requires the Registrar of the Court to give a copy of every decision affecting an international trust to the FSC. So there is no public register of international trusts, and there is also no absence of oversight.
Records have to exist. Section 27C(1A) requires the trustee to keep at the registered office a true, accurate and current record of income, assets held, assets made available to any beneficiary, advances, distributions and all transactions, sufficient to determine the trust’s financial position with reasonable accuracy. Records are retained for six years after termination.
CRS and FATCA apply to the trust’s financial accounts. The information moves between tax authorities.
What you still owe at home
A Cook Islands trust gives a US person no tax deferral and no tax reduction. Under 26 U.S.C. §679(a)(1), a US person who transfers property to a foreign trust is treated as the owner of the portion attributable to that property, for any year in which the trust has a United States beneficiary of any portion. You are taxed as though you still held the assets, because for this purpose you do.
| Obligation | Form | Who files | Timing |
|---|---|---|---|
| Transactions with a foreign trust, and ownership under §§671–679 | Form 3520 | the US person | with the return |
| Annual information return of the trust itself | Form 3520-A | the foreign trust, where it has at least one US owner | annually |
| Specified foreign financial assets | Form 8938 | the US person, above the threshold in the instructions | with the return |
| Foreign financial accounts | FinCEN Form 114, the FBAR, and FinCEN's own filing page | the US person, where the aggregate exceeded USD 10,000 at any time in the year | 15 April, automatic extension to 15 October, filed through the BSA E-Filing System |
The penalties are statutory rather than estimated. 26 U.S.C. §6677 sets the penalty at the greater of USD 10,000 or 35% of the gross reportable amount, substitutes 5% for 35% where the failure is the trust’s own annual return, and adds a further USD 10,000 for each 30-day period once the failure continues more than 90 days after the IRS notifies you. We do not publish the Form 8938 reporting thresholds here, because they sit in the instructions rather than on the form’s own page and we do not restate a figure we have not read at source.
Outside the United States the reporting differs but does not disappear. In the United Kingdom, HMRC’s settlements legislation and, for income, the transfer-of-assets-abroad rules in sections 714 to 751 of the Income Tax Act 2007 can both bite, and you should take advice before settling. In India, FEMA and the Reserve Bank of India’s Liberalised Remittance Scheme constrain the transfer itself, and the overseas investment rules can apply to the structure that receives it, so that is the question to answer before the trust question arises. In the United Arab Emirates there is no personal income tax, and federal corporate tax at 9% applies to businesses rather than to you personally, but your reporting follows your tax residence rather than the trust’s.
Who this suits, and who it does not
It suits
- A US physician, business owner or professional with meaningful liquid assets
- No claim filed against them or foreseeable
- A tolerance for an annual cost and annual filings
- Beneficiaries who are all non-resident in the Cook Islands
It does not suit you if
- A claim has already been commenced, because the section 13B(3) proviso removes the protection outright
- You are looking for a lower tax bill, because section 679 gives you the opposite
- You are unwilling to file Forms 3520 and 3520-A and an FBAR every year
- Your assets are mostly US real property, which stays in the United States and stays reachable
- Your total assets do not justify USD 3,510 a year plus legal fees
- You want to stay the protector without taking advice on what that did to the Andersons
We would rather tell you this before you pay anyone. If two or more of those apply to you, a Cook Islands trust is probably the wrong instrument, and the eligibility check is free.
Is the Cook Islands blacklisted?
The Cook Islands appears in neither Annex I nor Annex II of the EU list of non-cooperative jurisdictions for tax purposes as revised on 17 February 2026, and it is not on the FATF list of jurisdictions under increased monitoring as revised on 19 June 2026.
Both documents are linked above so you can search them yourself. For contrast, the British Virgin Islands does sit on Annex II, committed to obtaining a Global Forum review by February 2027. Claims that a jurisdiction is on “no blacklist” are common in this market and are rarely sourced. This one is.
How this compares to the alternatives
A Nevis international exempt trust is the closest substitute, and the two are usually decided on cost and on how each statute treats a creditor’s first step. A Cook Islands LLC is not an alternative but a component, often holding the assets while the trust holds the LLC. A US domestic asset-protection trust keeps everything within reach of a US court, which is either the point or the problem depending on your facts.
The head-to-head Nevis vs Cook Islands comparison and the Nevis and Cook Islands LLC pages are published separately, and this page links to them as they ship. For the trust and foundation service itself, see trust and foundation setup.
Frequently asked questions
- How much does a Cook Islands trust cost?
- Registration with the Cook Islands government costs USD 310, and annual renewal is USD 310. A licensed trustee company's published all-in first year is USD 3,510, which includes the government fee. Published market figures of USD 15,000 and above are mostly US legal drafting rather than Cook Islands charges. See the cost table for the full breakdown.
- What are the disadvantages of a Cook Islands trust?
- It gives a US person no tax benefit, it adds Forms 3520 and 3520-A and an FBAR every year, it costs at least USD 3,510 annually, and it does nothing for assets that stay in your own country, such as US real property. It also does not stop a court at home from making orders against you personally.
- What is the two-year rule for trusts?
- Under section 13B(3), a settlement is not fraudulent against a creditor whose cause of action accrued more than two years earlier. If it accrued within two years, that creditor must commence proceedings within one year of the settlement. If proceedings had already started when you settled, section 13B(3) does not apply at all.
- Is a Cook Islands trust legal?
- Yes. It is a trust registered under a statute of the Cook Islands and recognised as such. Legality is not the question that matters; reporting is. You remain responsible for declaring your interest to the tax authority where you are resident, and for US persons that means Forms 3520 and 3520-A, Form 8938 where applicable, and an FBAR.
- Can a US court reach a Cook Islands trust?
- It cannot enforce its judgment in the Cook Islands, because section 13D prevents that. It can and does act against you personally. In FTC v Affordable Media the settlors were held in civil contempt because, as protectors of the trust, they retained the power to compel repatriation.
- Do I have to give up control?
- Section 13C lets you keep seven kinds of power, including the power to remove and appoint a trustee or protector. Whether you should is a different question. Retained control was the reason the impossibility defence failed in Affordable Media, so this is a point to settle with a US attorney before the deed is drafted.
- How long does it take to set one up?
- The statute gives 45 days from the trustee's appointment to file the registration, and registration within 30 days of settlement is backdated to settlement. The variable part is the trustee's own due diligence, which the trustee times and confirms to you in writing. We do not publish a week count, because no primary source supports the figures in circulation.
- What state has the best trust for asset protection?
- That is a US domestic question rather than a Cook Islands one, and the answer depends on your state of residence and your creditor exposure. A domestic trust keeps the assets inside the US court system, which is the trade-off to weigh with a US attorney.
Before you go further
WeOpenOffshore is not a law firm, a bank, or a tax adviser. This page is general information, not legal or tax advice.
You remain responsible for reporting your interest in any foreign company, trust, or account to the tax authority where you are resident.
A trustee company licensed by the Cook Islands Financial Supervisory Commission is required for every Cook Islands International Trust. We introduce you to one. We are not a trustee, and we do not hold client assets.
See all jurisdictions we cover.
Fees verified 7 August 2026.