To FOREX (FX) or not to FX, that is the question! (Part 3)

February 20, 2013 - by Nida U.

(Part III) Application for a LICENCE to carry on, provide or transact any of the international financial services in or from within Belize.

When planning to start up your own business that involves money transmission services, don’t forget to obtain a special license, otherwise you can get into trouble! Under the Belize IFSC Statutory Instrument No 67 of 2007, we can assist obtaining special license. To be more specific, we can assist with licensing in Belize under thirteen different types of licenses.

Before starting to acquire a Belize broker, forex or any other licensed company, it is important to understand necessary application procedures and to have extensive understanding of the regulatory body that issues Belize special licenses. In Belize it is the IFSC (International Financial Services Commission) responsible for issuing and regulating all the thirteen different licenses.

Anyone (private person or corporation) can lawfully qualify carry on, provide or transact any of the international financial services in or from within Belize by obtaining a license in accordance with the regulations under the IFSC Act Chapter 279 of the Laws of Belize Revised Edition 2000.

When planning about jurisdiction for your brokerage, forex or any other type of financial services company, remember that Belize has a strong infrastructure and a world-renowned international financial centre. The fact is that Belize offers its offshore companies good benefits for the establishing of their offshore operations. Nevertheless just like in all business endeavors, it is wise to obtain sound advice and counsel. You will want to understand which is the most advantageous location, and which offers you the most possibilities, which jurisdiction will suit your needs and be the most discrete.

If you wish to obtain a special license, remember that you will need to submit a variety of documents and certificates in compliance with the Belize IFSC.

Firstly your Belize IBC will need to be specifically formed for the purpose of providing financial activities. That means that your company will have special memorandum and articles of association, and these will be submitted to the IFSC. Then you will need lots of other documents, which will include your IBC manuals for both internal and external procedures and detailed information on your IBC business, in this case we could call it Business Plan, as it is that specific. Then IFSC will require all compliance procedures as well fit and proper test details, management with the requisite knowledge and expertise of the business to be carried on.

This procedure in general is quiet long and complicated, therefore you need to have the knowledge and idea of where are you going with this.

Application process for financial license starts with filing application together with affidavits detailing personal and financial information on directors, shareholders, and officers of your financial services company. Depending on the extent you want to protect your privacy, it is possible in many jurisdictions to use qualified nominees.

In regards to your financial services company, it is very much advisable to outsource a fair amount of work. You should look for an advisor that would have the competence to help streamline your business, set up a successful website and help you in all other ways to structure your business in cost effective and efficient ways.

If you think that you can just “buy” your license, you are wrong! You must understand that a financial services license application depends mostly on yourself - who you are, what experience and qualifications you have, and how well you present your proposed business to the Regulator. Registered Agent can lead you through, polish your application, point out the weak spots, provide some advice and guidance and, of course, represent you in your application formalities vis-a-vis the IFSC. However, the underlying substance and contents of your license application will have to come from yourself, from what YOU have!

In any application, the IFSC primarily looks for the following:

A. That there is a competent, knowledgeable team of professionals, who are going to run this financial business on a daily basis. This is YOU.

B. That your team of professionals have immaculate reputations (no criminal record, no bankruptcies, etc.).

C. That your management team have appropriate qualifications (formal education) and skills (prior work experience), suitable for running this particular kind of financial business. Basically, that you know what you are doing.

D. That you and your team have sufficient material resources to set up and run this financial business properly - i.e., that you have the money for the paid-up capital and for the initial launch costs, that you have an adequately equipped and staffed office, that you have the ommunications, IT technology and software necessary to run this kind of business roperly.

Basically, the IFSC will want to know and understand WHO will be running the business (actually) and WHAT FACILITIES will they have in place to service its potential clients properly.

The more detailed your whole presentation, the better your chances. Like I said this is a long and complex procedure, therefore depending on the complexity of your application, and depending whether there are any additional questions and requests from the IFSC the whole application procedure could take between 1 and 3 months.

Thank you for reading my post! And you are welcome to leave comments, feedback, suggestions for other posts or contact me for more information.

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