Foreign exchange trading companies

• A capital company has been registered in accordance with the procedures specified in laws and regulations governing commercial activities;
• the capital company has no tax debts;
• a shareholder and stockholder (up to a natural person who is the beneficial owner within the meaning of the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing) complies with the conditions laid down in Section 20, Paragraph one, Clause 3 of the Law on Payment Services and Electronic Money and is not subject to the conditions laid down in Section 21, Paragraph one of the Law;
• the chairperson of the council (if such has been established), a member of the council, the chairperson of the management board of the institution, a member of the management board or a procuration holder conforms to the conditions laid down in Section 20, Paragraph one, Clause 3 of the Law, and the provisions laid down in Section 21, Paragraph one of this Law are not applicable thereto;
• the person responsible for compliance with the requirements of the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing appointed by the capital company shall comply with the requirements of above Law.

Preparation for the submission of application: an introductory stage, during which Latvijas Banka organises a meeting with an entrepreneur to discuss its business planned.

What does the entrepreneur do

• Prepares information on the shareholder, stockholder and officials of the enterprise.
• Starts the drafting of the necessary documents.

What does Latvijas Banka do

• Provides advice regarding the applicable regulatory framework.
• Provides advice on documents to be submitted.

What should be taken into account

• Please refer carefully to the regulatory requirements.
• Assess the need to attract qualified experts or consultants.

Documents to be submitted:

• the CVs of the shareholder, stockholder and officials;
• firm legal documents;

Costs

Preparing for submission of the application and provision of advice by Latvijas Banka are free of charge.

Submission of application: An entrepreneur prepares and submits an application for registration.

What does the entrepreneur do

• Submits a fully completed application for registration and all necessary information, documents in accordance with the requirements of Section 26.³ of the Law and Latvijas Banka regulations No 21.
• Receives information from Latvijas Banka regarding starting the examination of the application for registration or on deficiencies to be addressed in the submitted application.
• Provides the necessary additional explanations.

What does Latvijas Banka do

• Carries out an assessment of the completeness of the application within 10 working days (the assessment of the application as to the substance is not yet ongoing).
• If the application is incomplete, Latvijas Banka sends a letter to the entrepreneur indicating the deficiencies identified which need to be addressed.
• Latvijas Banka designates the project manager and gives the entrepreneur access to the project management tool, which will help to follow the process.

What should be taken into account?

• Before submitting the application, please apply for advice offered by Latvijas Banka experts.
• Make certain that the documents to be submitted are complete and of high-quality.
• Check that all necessary documents have been submitted (see a list of documents to be submitted).

List of documents to be submitted

A legal person shall apply for the authorisation of a payment institution.

The application shall be prepared in accordance with Section 26.³ of the Law and Latvijas Banka regulations No 221.

Costs

2500 euro for examining documents and information submitted for authorisation (should be paid upon official submitting of the application).

500 euro for examining documents and information submitted for authorisation if a capital company is already registered in the register of institutions in accordance with Section 5 or 5.¹ of the Law.

Payment should be made at the time of the submission of application.

Time limit for examining the application

Latvijas Banka starts examining the application within 1 month from confirmation that the application is complete. The time limit for examining the application may be extended if the information provided in the application is not sufficient to take a decision on the issue of authorisation.

Assessment of application: Latvijas Banka carries out the assessment of the application as to the substance.

What does the entrepreneur do

• Follows the examination process by using the project management tool.
• Provides answers to additional information requests by Latvijas Banka as soon as possible, as well as appoints a contact person for more effective communication.
• Corrects the submitted documents according to Latvijas Banka’s instructions.
• Participates in meetings held by Latvijas Banka.

What does Latvijas Banka do?

• Carries out the assessment of the application as to the substance.
• Contacts the contact person of the entrepreneur in case of identification of deficiencies.
• Draws up a letter if deficiencies are identified in the application.
• Continues the examination of the application pursuant to the additions submitted.
• Completes the examination of the application.

What should be taken into account?

• Follow the course of the examination of the application.
• Provide additional explanations and make the necessary corrections as soon as possible.
• Representatives of the entrepreneur are invited to participate in meetings of Latvijas Banka, not just consultants (if any).

Costs

No additional costs associated with the examination of documents during the assessment stage of the application are applied.

Receipt of registration: Latvijas Banka finalises the examination of the application and takes a decision on the issue or refusal to issue authorisation.

What does the entrepreneur do

• Prepares to obtain authorisation and commence operations in accordance with the business plan.
• Designates users of Latvijas Banka Data Reporting System for future communication with Latvijas Banka and submission of performance reports.

What does Latvijas Banka do

• Prepares a decision on the issue or refusal to issue authorisation.
• Informs the entrepreneur of the decision taken.
• Places information on the website.

What should be taken into account?

• Please refer to the information provided by Latvijas Banka on access to the Data Reporting System.
• Please refer to information related to the requirements and procedures for reporting.
• Prepare to commence activities in accordance with the approved business plan and procedures.

Costs

No additional costs associated with obtaining authorisation during the stage of obtaining authorisation.

Supervision: Latvijas Banka supervises activities of the enterprise in accordance with requirements of Law.

What does the entrepreneur do

• Provides answers to the Latvijas Banka’s requests.
• Prepares reports in accordance with laws and Latvijas Banka’s regulations.
• Notifies Latvijas Banka of changes in documents and in the procedures submitted for authorisation.
• Notifies Latvijas Banka of trading venues of the foreign exchange trading company.
• Gets acquainted with the enterprise’s curator designated by Latvijas Banka.

What does Latvijas Banka do

• Designates the enterprise’s curator.
• Assesses compliance of enterprise with the regulatory requirements.
• Requests additional information on the business and performance of the enterprise.
• Examines the reports submitted and supervisory information.

What should be taken into account?

• In case of uncertainties, please contact the curator designated by Latvijas Banka.
• Submit reports and requested supervisory information on a regular basis.
• Notify of changes in the process of the provision of services, as well as changes in documents submitted for authorisation, including in case of changes to the structure officials or participants.

Costs

Foreign exchange trading company which has received a permit from Latvijas Banka shall pay Latvijas Banka EUR 2 000 per year and up to 0.2 per cent (inclusive) of the total amount of foreign currency purchased and sold per year, but the total currency trading company’s fee to Latvijas Banka shall not exceed EUR 20 000 per year.

If the foreign exchange trading company is a payment institution registered in the register of institutions in accordance with Section 5 or 5.¹ of the Law, its total fee to be paid to Latvijas Banka shall not exceed EUR 100 000 per year.

Latvijas Banka annually issues regulatory enactments for determining the amount of payments for financing Latvijas Banka made by financial and capital market participants and submitting reports, in which the variable part of the payment is determined for each market participant, as well as the procedure for making payments.