Double fiduciary model — secure control, enable utilization
The dual trustee model is a strategic instrument that has proven itself in practice when creditors want to secure control over company shares or rights and at the same time prepare the economic realization efficiently, without blockades and in compliance with the law.
We show why this model offers real advantages, particularly in crisis situations — such as protection against third-party access, the ability to act despite conflicts and discretion in implementation.
In many utilization situations, a simple security structure is not sufficient.
Especially not if a company is to be saved from insolvency, a GmbH share is to be realized in accordance with the law or a complex creditor interest is to be safeguarded.
It is precisely in such cases that we rely on the dual fiduciary model in practice — a flexible yet highly effective instrument that ensures control and creates leeway.
What is the double fiduciary model?
Essentially, this involves two coordinated fiduciary relationships:
- The inner trustee is the formal owner of the assets — for example, the registered shareholder of a limited liability company or the owner of an IP right.
- The outer trustee controls the inner trustee — typically on behalf of one or more creditors or as part of a restructuring or liquidation concept.
In this way, the assets remain legally protected — and at the same time economically controllable.
In practice, the model is often implemented by lawyers, restructuring consultants or economically neutral trust companies — especially when it comes to conflict-laden shareholdings or secured realizations.
Why should you use this model?
The dual fiduciary model is not a theoretical construct — it solves real problems when it matters.
Here are the six most important benefits from recycling practice:
1. ensure control — without personal liability
Creditors receive de facto power of disposal over shares, rights or claims — without themselves acting as shareholders or incurring personal liability.
2. security through legal conformity in utilization
The model allows GmbH shares, IP rights or receivables to be realized in a legally compliant manner — even in the case of blocked shareholder structures or situations close to insolvency. The realization can be carried out by a publicly appointed, sworn auctioneer — on behalf of the trustee.
3. protection against individual enforcement
Once secured in trust, the assets are protected from uncoordinated individual access by other creditors. The liquidation is structured — in the interests of all parties involved.
4. flexibility in restructuring and M&A
The model can be combined with debt-to-equity swaps, preparatory measures for a company sale or investor solutions. The external trustee can decide at any time — without being blocked by outside shareholders.
5. discretion and freedom of negotiation
The beneficial owner does not appear externally. This creates room for negotiation — for example in restructuring, investor discussions or distressed M&A.
6. asserting creditor interests — even in difficult situations
Particularly in the case of company shares, rights or complex creditor pools, the double fiduciary model can be the basis for a realization of value at all.
A concrete example
A creditor has a contractual pledge of rights to the shares of a GmbH.
The aim is short-term realization — without the debtor’s consent.
The shares are transferred to an internal trustee — this is entered in the commercial register.
At the same time, an external, neutral trustee is given the right to issue instructions and the liquidation mandate.
In the next step, a publicly appointed auctioneer is commissioned — for example for an auction in accordance with § 23 GmbHG.
The auction is transparent and legally compliant — and the proceeds are used to repay the secured claim.
The entire process remains controllable, unblocked and economically viable.
Our conclusion
The dual fiduciary model enables economic control with full legal protection.
It ensures the realizability of company shares, rights and assets — even in difficult and blocked constellations.
And it creates a clear basis for public auctions — as an orderly and transparent form of utilization.
If you are confronted with a non-performing investment or a share to be liquidated: Talk to your legal advisor or an experienced trustee at an early stage.
Compared to other designs, the process can be implemented quickly and cost-effectively.
As publicly appointed, sworn auctioneers, we are happy to support you in the realization of the sale — discreetly, efficiently and in compliance with the law.
> We look forward to hearing from you! To the contact form.
Picture credits: Photographer kelvn_photo, envato elements Y57LZ9TKAN
