The driver for orphaning is to enable the securitisation transaction to be held off-balance sheet.
[4][5] The key considerations in deciding what 3rd party entities are used to "own" the orphaned SPV equity are driven by: Given the above, the orphaned SPV equity is usually held by a nominee share trustee company on trust pursuant to a Declaration of Trust (and never via an individual).
Some jurisdictions have used Charitable Trusts due to their particular robustness to avoiding bankruptcy (not legally possible for it to enter a bankruptcy process), however, this had led to some public concerns over the integrity of the overall orphaned SPV structure (e.g. Matheson in Ireland),[8][9] and has now been stopped in Ireland.
The orphaned SPV structures they use are understood and accepted in many jurisdictions, by regulators and taxing authorities as vehicles in which to conduct global securitisation transactions.
Unfortunately, the global acceptance of the main orphaned SPV structures has attracted the attention of users who are not seeking to conduct standard tax-transparent securitisation transactions, but who have other aims and objectives which regulators and tax authorities did not envisage orphaned SPVs being used for.