Among European countries where forex business is interesting and profitable, there are several types of states ‒ those that are considered traditional for the industry and those that have recently entered the market. The Baltic region is a promising area, which, thanks to its membership in the EU, is opening up broad opportunities for work.
Latvia is especially attractive for entrepreneurs wishing to obtain a forex license. The country has a developed, well-established banking system, with clear and transparent legislation. At the same time, for incorporated companies, recipients of the Latvian license, certification in the EU is available – this is a key factor for many business owners from the former USSR states who are looking to expand to European markets.
As per the existing Directive regulating operations with financial instruments and implemented in Latvia, all EU-States are obliged to give companies the freedom to provide services covered by their license.
Once your investment brokerage firm has been licensed in Latvia, you can simply notify the authorities of other Eurozone states of your intention to offer investment services in their territory (this will be regarded as actual certification). All you need is to obtain approval from the selected state without going through the licensing process again.
The following are some of the benefits offered by Latvia as a forex operations jurisdiction:
Latvia offers broker licenses to legal entities that are local residents or members of the European Union (duly certified). It should be understood that the Republic of Latvia is not an offshore business, commercial operations are subject to standard taxation. All relations in the financial instruments market are regulated by a specialised Supervisory Commission that carries out its functions as per the relevant legislation of the Republic of Latvia.
Prifinance provides the full range of support in obtaining a forex license in Latvia. We have gained considerable experience in the safe conduct of all types of businesses in various jurisdictions, and provide services for:
When forming the authorised capital of a licensed forex firm, it is not possible to use intangible assets. The supervisory commission determines the level of equity capital sufficient for the subject, who is obliged to maintain the set "bar". The minimum threshold for entry into the market for authorised capital is EUR 50,000, including:
One hundred percent of the capital must be paid. High risk transaction amounts should not exceed the amount of equity by more than eight times.
Features of Documentation and Registration of Companies with Latvian Forex Licenses
To obtain a broker license, as a rule, you must first establish and register the appropriate firm. After that, you will need to:
No fee is charged for the license, but there are mandatory annual fees with rates set by the Latvian regulator on an annual basis.
Company incorporation under the auspices of Prifinance usually takes up to a week; if one or more of the founders is a legal entity ‒ up to two weeks. The company is required to have a full and real address, conduct bookkeeping and submit reports. Once the account is activated, the licensing authority is provided with the following:
To obtain a forex license in Latvia, a company must meet the numerous requirements that apply to owners, authorised capital, personnel and so on.
The following rules are established for the owners of the company applying for brokerage activity:
In addition to the above conditions set for members of the Board of Directors / Executive Committee, the personnel of firms that have received a forex license are also subject to other requirements. The firm is required to employ two residents of the Republic of Latvia in senior/management positions. They must remain directors for the entire duration of the license. The management and key employees of the firm must have:
The employed persons are agreed with the Commission ‒ it checks the information and grants the work permit.