Cryptocurrencies and their market are increasingly integrated into the economies of countries. So, as part of business activity gradually flows into the crypto market, progressive and business-oriented countries are trying to lead this process in order to gain competitive advantages over other countries. In this review, we invite you to familiarize yourself with the current products on this topic in the UAE and Cyprus.
UNITED ARAB EMIRATES.
By becoming a UAE tax resident (0% tax), say goodbye to high corporate taxes and enjoy 100% repatriation of profits and capital. There is no income or corporate tax in the UAE. To avoid double taxation of foreign companies, Dubai / UAE has signed double taxation treaties with many countries around the world.
At the moment, in this country, the company can obtain the following licenses:
Proprietary Trading in Crypto-commodities, which includes buying and selling (proprietary trading) of cryptocurrency commodities, developed from distributed ledger technology applications. This license does not include permission to act as an exchange, brokerage, financial services, banking, payment processing, or custody services.
Distributed Ledger Technology, which includes the provision of database management solutions and ancillary services based on distributed ledger technologies such as blockchain. Companies engaged in this activity are not allowed to trade or set up currency or cryptocurrency / goods exchange, or provide any financial activity, brokerage or payment processing services.
As for the bank account, please note that the Central Bank in the UAE does not currently support this type of business, but in the near future, according to our information, the position of the Central Bank will be revised.
Meanwhile, if you register your license at the DMCC Cryptocenter, we will help you open a bank account abroad in Switzerland at Seba Bank, or other banks outside the UAE that we cooperate with until the same is allowed in the UAE.
The cost of opening a company with a license, an office and the possibility of obtaining up to 3 visas ranges from Dirham 61.656 to Dirham 72.656, depending on the office you choose.
The cost of obtaining a visa is not included in this amount.
Creation of a licensed cryptocurrency exchange company in Cyprus
A company with a Crypto license in Cyprus has the following advantages:
- No tax on profits from trading in cryptocurrencies.
- Without VAT
- Uncomplicated application procedure
- Lower application fees than other European countries.
The Cyprus Securities and Exchange Commission CySEC is the registration and regulatory authority for licensed companies.
Crypto Asset Services must have an initial capital of EUR 50,000.
- Consulting on investments in crypto assets
Crypto Asset Services must have an initial capital of EUR 125,000.
- Reception and transmission of customer orders
- Execution of orders on behalf of clients
- Exchange between cryptoassets and fiat currencies
- Exchange between crypto assets
- Participation in and / or provision of financial services related to the distribution, offer and / or sale of cryptoassets, including the initial offer
- Placing crypto assets without firm commitments
- Portfolio management
Crypto Asset Services must have an initial capital of EUR 150,000.
- Administration, transfer of ownership, transfer of the site, storage and / or secure storage, including storage of cryptoassets or cryptographic keys or means to control cryptoassets
- Underwriting and / or placement of cryptoassets with firm commitments
- The operation of a multilateral system that brings together several third- parties interested in buying and selling cryptoassets in a way that leads to a transaction.
Conditions and requirements for obtaining a license
- The clauses of the Company Memorandum shall define the activities of the company in accordance with the chosen Class.
- The capital of the company must correspond to the selected class.
- Requires 4 directors. 2 non-executive directors and 2 executive directors who must be residents of Cyprus.
- The company must have a presence in Cyprus.
- Guidelines for internal procedures, anti-money laundering and “know your customer” procedures in accordance with the requirements of the regulatory body CySEC
- Directors and shareholders must be qualified for their position and pass the so-called “compliance test” in accordance with the requirements of CySEC.
Application procedure (Key Points)
- Filling out the Application, questionnaire with supporting documentation
- Corporate documents of the company (certificate of registration, certificate of directors and secretary, shareholders, legal address, memorandum and articles of association, etc.)
- Guide to internal procedures
- Guidelines for Combating Money Laundering
- The time required to fill out the application and prepare the accompanying documentation is 1-2 months, depending on how quickly the supporting documentation will be available.
- Submission of the application form and supporting documentation to CySEC
- Approved or rejected response from CySEC within 6 months from the date of application
CySEC Application Fees
CySec application fees € 10,000 - non-refundable
Annual license renewal fees € 5,000.
Our fees for registering a company, helping to fill out an application, questioning, submitting and tracking an application to CySEC will range from 15,000 to 20,000 euros, plus VAT, plus payments (documents related to the conditions and requirements for obtaining a license (for example, a guide on AML, business plan, no criminal record of shareholders, directors, HR departments, etc. are not included in our fees)