Malawi is taking steps to modernise its legal framework for trusts, with the government convening a stakeholder consultation in Lilongwe on Thursday to gather input on a Draft Trusts Bill that officials say is long overdue.

The Solicitor General and Secretary for Justice and Constitutional Affairs, Gertrude Lynn Hiwa SC, told participants that the existing legal framework was inadequate and had left significant gaps in transparency and accountability.

"Currently, Malawi does not have a regime for registration of settlement trusts," she said. "The Trustees Incorporation Act only provides for the incorporation of qualifying charities and associations."

Hiwa said the absence of a registration regime had become increasingly untenable, particularly given international obligations to combat money laundering and terrorist financing.

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"The urgent need for a registration regime for trusts has been heightened by the obligation for our country to provide for beneficial ownership transparency for legal arrangements," she said.

While Malawi has made progress on beneficial ownership reforms under its Companies framework, trusts have remained outside the scope of those changes. The Draft Trusts Bill, Hiwa said, was designed to close that gap.

"The Draft Trusts Bill seeks to address these gaps by creating a modern, practical and responsive legal framework that will support trust structures, promote legal certainty, transparency and strengthen appropriate regulatory oversight," she told participants.

Consultant Reyneck Matemba, working with the Companies Registrations and Intellectual Property Centre, presented the contents of the Bill and urged stakeholders to engage fully to help refine the legislation before it advances through the parliamentary process.

Registrar General Chikumbutso Namelo echoed that call for active participation.

Hiwa expressed gratitude to the Chandler Institute of Justice for providing technical assistance in drafting the Bill.

The consultation drew representatives from the private sector, the Ministry of Justice, civil society, the Malawi Law Society and the Reserve Bank of Malawi, among others -- reflecting the broad reach of reforms that officials hope will enhance transparency, accountability and investor confidence once enacted.