What steps do you have to go through before receiving a permit in the Czech Republic?
There are a large number of jurisdictions in Europe that grant permission to crypto organizations, but many prefer Czechia. It is largely because this country has a stable economy, a huge number of crypto enthusiasts, and very logical rules for regulating the crypto industry. Receiving a Czech Republic crypto license will not be difficult if you are willing to work honestly and openly. Still, you will have to complete several necessary steps, which we want to discuss in more detail.
1. Select license type
Most countries have one general license for all crypto organizations, but Czechia has developed a more complex system; there are as many as 4 types of permission. The choice depends on the kind of activity of your organization:
- 1 – classic. It involves the exchange of one crypto asset for another.
- 2 – fiat. It involves exchanging crypto for fiat.
- 3 – traditional. It combines the two above.
- 4 – special. Suitable for wallets and other projects that do not exchange currencies.
If you need help determining the type of permit, you can seek help from specialists. It is worth saying that obtaining a receipt does not depend on the permit choice.
2. Check whether your organization meets the requirements
Obtaining permission here is relatively easy, but your organization must meet specific requirements. Among the most important are:
- AML/KYC compliance;
- The organization must employ a security specialist who will monitor compliance with requirements and regularly submit reports to regulatory authorities;
- Comply with the international sanctions regime;
- Impeccable reputation of the owner and employees in critical positions;
- Impeccable risk assessment.
Unlike other European jurisdictions, there are no local office and employee requirements; this country is open to foreign investors.
We recommend hiring an independent auditor to review your organization’s activities and advise you on what changes should be made to ensure your organization fully complies with government regulations.
3. Collection of documents
Before starting the licensing process, you need to collect a relatively large package of documents, which must include:
- Complete data about the owner and employees in critical positions (no criminal record certificates, resumes, educational diplomas, recommendations, and much more);
- Business plan (all information about the activities of your organization should be described here);
- Documents confirming compliance with AML and KYC;
- Checking the selected title and many others.
Before you decide to open an organization, you must make sure that you come up with a unique name that is not similar to the names of other companies registered here. It cannot be easy to collect a complete package of papers without the help of lawyers. Gofaizen-Sherle specialists will help you manage and fill out all the paperwork correctly. They will tell you what points you should pay attention to to avoid rejection.
4. Registration of a firm
You must submit papers to the regulatory authorities to register a legal entity in this jurisdiction. They usually review the application within 2–3 weeks. After this, you can begin the permitting process. The failure rate here is meager, so you don’t have to worry.
5. Obtaining a work permit
You must submit your application and all necessary papers to the regulatory authorities at this stage. People can do this in person or through an official representative. In the second case, you must draw up a power of attorney.
On average, application processing takes 2–3 weeks. If regulators have questions about your firm’s operations, they will request a formal change. In this case, the application review process may take much longer.
6. Getting a bank account and getting started
After receiving permission, you need to open a bank account. Unfortunately, not all organizations are ready to cooperate with crypto organizations, as they consider this business very risky. So, prepare data that will help prove that your organization is viable.
If you can’t find this, you should seek help from EMI organizations. They are usually quite friendly to the crypto industry.
You also need to develop accounting rules. Ideally, you should hire independent crypto accounting professionals. It will enable you to prepare reports to regulatory authorities more quickly.