Albert Regulatory Consultant Piispankatu 12 B 46, 20500 Turku, Finland

Financial License Applications

I have submitted various successful applications to regulatory bodies (BaFIN and FinMa) for finanical licenses. I therefore can help you to do your license applications. That means more specifically that I can examine the license requirements of a business model, send all accompanying inquiries to BaFin of VQF/FinMa, examine the chances of success of your license application, prepare the application documents themselves and also accompany you and your project during the approval process and also represent you to before the regulatory bodies in cases of conflicts.

Transactions that require a license

In addition to the license requirements for classic banking and financial services that follow for example from Section 32 KWG, anyone who collects money from several people also needs a written permission from BaFin in order to invest this for the benefit of these people in accordance with a defined investment strategy. If a so-called investment fund is set up and managed as a result, the administrator must either register with BaFin or – if the assets under management exceed a certain amount – apply for approval in accordance with Section 20 of the Capital Investment Code (KAGB).

In addition, individual activities in the area of ​​online trading also require a permit fromregulatory bodies, especially if customer funds are to be accepted and passed on to a third party as part of the business activity (so-called payment services).

Anyone who deals with topics such as crowdfunding, crowdinvesting, crowdlending, bitcoin and tokens, payment processing and fiduciary services should also pay special attention to the subject of authorization requirements. Not only BaFin or FinMa itself systematically reviews the design of new business models on the market. Also for competitors, information to the responsible authorities is a welcome opportunity to get rid of unwanted competition.

It is also punishable to conduct business that requires a license or to provide services that require a license without the corresponding permission, whereby the relevant laws (in particular Section 54 KWG / Section 63 ZAG / Section 339 KAGB) already allow negligent acts to be sufficient. A negligent violation is to be assumed if the managing directors have not inquired about an intervening authorization requirement.

In addition to the consequences under criminal law, the persons involved also face civil law claims, which can quickly take on a life-threatening dimension. So dont go to jail. Ask me first.

Exceptions to the license requirement

In addition to the license requirements, the relevant laws also specify numerous exceptions to the license requirement. For example, a permit pursuant to Section 32 (1) KWG is not required for those who conduct banking business within a group or who only provide investment and financial intermediation, placement business or investment advice under a liability umbrella (so-called tied agent / tied agent).

I can explain you in detail about any specific exceptions to the license requirement, as well as about possible options to adjust the planned business activity so that license requirements are not affected.

Application for permission

Anyone who has recognized for himself that he has to deal with the topic of a financial licensing approval should first be very clear about the services that are subject to authorization in the planned business activity. This is the only way to ensure that the specific requirements of the respective permit can be fully identified and their individual compliance can be checked.

The future license holder must submit the application for permission in writing. In the case of corporations by the board of directors or the management on behalf of the company or in the case of partnerships by any personally liable partner.

In addition to the specific requirements for the individual activities requiring authorization, the regulatory bodies almost always request that a detailed description of the planned business model is enclosed and a viable business plan with resilient budget planning for the next three fiscal years is drawn up.

Submission of so-called sample contracts (general terms and conditions, customer contracts, etc.) the professional suitability and reliability of the managers a description of the organizational structure of the applicant (risk management) proof of the existence of sufficient initial capital

The professional suitability and reliability of the managers

The qualification of a manager is of central importance for the financial license. This is demonstrated, among other things, by the fact that a license to conduct banking business, to provide financial services and payment services, as well as the permits in accordance with the Capital Investment Code, are only issued by the authority if the proposed managing directors meet the professional and personal requirements of the respective law. This includes many years of experience in the financial sector, no criminal record and a proven track record of personal reliability.

I have been recognized by BaFin and VQF (FinMa) as regulatory expert that fulfils the legal requirements to fill these positions.

Minimum capitalization

To successfully apply for example for a BaFin license, the applicant needs a minimum amount of capital. Depending on the planned business activity, the minimum amount fluctuates between EUR 50,000 for “simple” financial services and up to EUR 25,000,000 if the upper end of the scale (e.g. Pfandbrief business) is operated.

In case you require assistance, do not hesitate to contact me using the links below.

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