Founder rights: which rights should be expressly reserved in the declaration

Section 3(3) PSG provides that founder rights to shape the private foundation do not pass to legal successors. Heirs therefore do not automatically receive amendment, revocation or other personal design rights, even if they belong to the next family generation intended to benefit.

Where there are several founders, rights belonging or reserved to them are generally exercised jointly. Section 3(2) allows the foundation deed to provide a different arrangement. Without one, disagreement between two founders may prevent a needed amendment.

A later contribution does not confer founder status. Under section 3(4), a person dedicating further assets to an existing foundation gains no founder rights as a result. If another family branch is to participate, its role must be designed through lawful governing, information or beneficiary provisions.

After the foundation has come into existence, the founder may amend the declaration only if the right to amend was reserved. The amendment reservation is therefore the central bridge between the original plan and later changes in the family, assets or regulatory environment.

A short sentence reserving amendments does not answer every practical question. With several founders, the deed should say whether they decide jointly, by a specified majority or in separate subject areas. It should also address whether the power covers the foundation deed and supplemental deed and how an amendment is evidenced.

Under section 33(3), an amendment becomes effective upon registration in the company register. The board files an amendment to the foundation deed with a publicly certified copy of the resolution and registers the fact that the supplemental deed was amended. An internal intention or unsigned draft does not change the governing documents.

If the reservation is absent or cannot be exercised, the board may not simply implement new founder wishes. Section 33(2) permits the board to adapt the declaration to changed circumstances only while preserving the foundation purpose and with court approval. That is a separate and narrower mechanism.

A founder may revoke the private foundation only if revocation was reserved in the declaration. Section 34 PSG excludes such a reservation for a founder that is a legal entity. A natural person may reserve it, but the clause is not suitable for every foundation.

The right of revocation is not a power to withdraw selected assets at any time. Revocation is a statutory ground for dissolution. The board’s duties, winding up and distribution of assets then follow under the applicable declaration and statutory framework.

Before including the reservation, founders should test the consequences for ultimate beneficiaries, creditors, continuing contracts, businesses and real estate. A foundation designed for long-term business succession usually pursues a different stability objective from one that intentionally preserves a personal exit for the founder.

The reservation should not be confused with a private promise to transfer assets back. If the economic consequences and dissolution provisions are not aligned, the deed creates a formal right without creating an orderly route for exercising it.

The first foundation board is appointed by the founder or foundation curator under section 15(4) PSG. For later appointments, the declaration must create a functioning system, for example through another body, a specified appointing office or a staged procedure.

A personal appointment right solves the initial question but not succession. The deed should determine who takes over in the event of death, permanent incapacity, resignation or conflict. Otherwise a strong influence right can become a vacancy requiring court intervention.

Beneficiaries may be named directly in the declaration or identified by a person or body authorised for that purpose. Section 5 provides for identification by the foundation board if no such office has been designated. If criteria and process are not separated, family allocation decisions are shifted into the management body.

Appointment and identification powers do not justify continuing instructions to the board. The board manages and represents the foundation independently, safeguards its purpose and remains bound by statute and declaration. Foundation board and liability examines that boundary.

No plan for multiple founders: everyone is to retain influence, but the deed resolves neither disagreement nor the loss of one person.

Amendment without implementation: the deed names the power but not the decision route, scope and evidence.

Revocation without winding-up design: a personal exit is reserved without aligning ultimate beneficiaries and treatment of assets.

Appointment without succession: the founder can appoint the board, but no functioning replacement mechanism remains after the founder can no longer act.

Mixed roles: a personal design right is treated as a right to issue instructions to the board or advisory body. The wording then conflicts with statutory governing responsibility.