Seychelles-Security Dealer License(SDL)-forex

Seychelles Offshore Securities Dealer Forex & Brokerage License

The Securities Act 2007 provides the legal framework for the provision of Securities Dealer Services. A Seychelles Securities Dealer License is a license which allows a company to trade in securities either as a principal (on its own account) or as an agent (on behalf of its clients).

The regulatory authority, which grants the authorization for such a firm, is the Financial Services Authority (Seychelles)

This license is particularly beneficial for Companies worldwide, who deal/trade in securities. This license is an important tool for your organization to attract more clients. The license will give your firm more credibility in the eyes of your wholesale broker and your clients!

Effectively, an entity that holds a Seychelles Securities Dealer License can:

  • Advise other persons concerning investment in securities
  • Issue, analyse or prepare reports concerning specific securities
  • Manage a portfolio of securities for another person

A Securities Dealer License is basically a broker License that allows a company to trade in securities either as a principal (on its own account) or as an agent (on behalf of its clients).

A Securities Dealer is a person:

  • Who carries on business of dealing in securities, or
  • Who holds himself out as conducting such business described below:
    • Makes or offers to make an agreement with another person to enter into or offer to enter into an agreement, for or with a view to acquiring, disposing of, subscribing for or underwriting securities or in any way effects or causes to effect a securities transaction; or
    • Causes any sale or disposition of or other dealing or any solicitation in respect of securities for valuable consideration, whether the terms of payment be on margin, installment or otherwise or any attempt to do any of the foregoing; or
    • Participates as a securities dealer in any transaction in a security occurring upon a securities exchange; or
    • Receives as a securities dealer an order to buy or sell a security which is executed; or
    •  Manages a portfolio of securities for another person on terms under which the first mentioned person may hold property of the other person.

A Securities Dealer may deal in shares, warrants, debentures, loan stock, bonds, certificate of deposits, futures, contract for difference and options.

Seychelles is one of the most sought-after Jurisdictions among brokers for obtaining
A forex license

The Seychelles Financial Services Authority (formerly the Seychelles International Business Authority) is responsible for all Seychelles non-banking financial services including Forex brokerages, trust companies and issuing Forex trading licenses. In addition to issuing the licenses they are responsible for supervising, monitoring and developing the service industry which provides this sector with all it needs.

In 2013 the Financial Services Authority Act created the Seychelles Financial Services Authority tasking it with a specific mission – to create an environment which was conducive for nurturing and developing the financial service industry in the Seychelles in accordance with economic development tactics of the Seychelles in alignment with local and international regulatory best practices and norms.

When opting for a Forex trading license in the Seychelles you need submit an application for a Special License Company which was formulated according to the Seychelles Companies Act, 2003. This process can be more complicated and costlier than setting up an international company. However, it comes with more benefits especially when the business is licensed through the FSA.

To apply for a Special License Company (CLS) in the Seychelles you need to submit documents such as a business plan; market information; a marketing strategy; professionally prepared financial forecasting; corporate documents and the applicable application forms to the Seychelles Financial Services Authority (FSA). When you are issued with a Certificate of Approval you must then apply to the domestic Seychelles Registrar of Companies to incorporate your business. When this is done the Registrar will grant a Certificate of Incorporation which then allows you to get a Special License granted by the FSA stating that your company is to be a Special License Company.

Offshore Securities Dealers License (SDL)
Seychelles Advantages

Why Seychelles for Securities Dealer License?

The growing popularity of Seychelles as a preferred jurisdiction for setting up a Securities Dealer License is due to some of the elements below.

  • Modern, expedient and flexible Seychelles Securities law
  • Proven track record with a steady growth (10%+)
  • Is an extensively researched law
  • Outstanding political and social stability Is an enabling law
  • Regulator flexibility
  • Convenient time zone at GMT+4
  • Enhanced privacy
  • Excellent facilities in terms of service providers, communications, service businesses, etc
  • Favorable corporate tax rate (1.5% p.a. on income)
  • Attractive corporate and personal tax environment and access to tax treaties
  • Allows the foreign Securities Dealers from recognized jurisdictions
  • Free remittance of profits and capital
  • Low required capital / no blocked capital. The required capital to get the license granted is just 50,000 US$. That amount needs to be hold in a bank account at the Seychelles (e.g. with our lawyers) and can be withdrawn as soon as the license is issued. It can be used for building up the company, infrastructure measures etc.
  • There are no restrictions in the number of clients to be accepted

Take advantage of the Cyprus “IP Box” Tax Regime

In May 2012 the Cyprus Government has introduced growth measures which amongst others included a package of incentives and tax exemptions relating to income from intellectual property rights, aimed at stimulating investment in research and development. Therefore now Cyprus offers an efficient IP tax regime coupled with the protection afforded by EU Member States and by the signatories of all major IP treaties and protocols.

Intellectual property projects lend themselves to cross-border planning by reason of the mobility of intellectual property rights, which are intangible and can therefore be easily migrated between different jurisdictions and tax systems according to prevailing circumstances and developments in different jurisdictions.

The amendments to the Income Tax Laws are effective from 1 January 2012 and apply to all expenditure for the acquisition or development of intangible assets.

Registerable IP does not need to be registered in Cyprus to benefit from IP regime in Cyprus.

The Double Tax Treaties

Cyprus has over 50 Double Tax Treaties currently in effect and many more in the pipeline. This gives the ability to extract royalties from these jurisdictions at reduced or even zero withholding tax rates.

To directly access Cyprus Ministry of Finance to access List of Double Tax Treaties signed by Cyprus, click HERE

 –http://www.mof.gov.cy/mof/mof.nsf/page26_en/page26_en?OpenDocument

Cyprus IP Location Tax Benefits

The EU Directive and Regulations relating to IP protection have been fully transposed into Cyprus national legislation. As a result, with a single IP registration in Cyprus, IP rights which are owned by a Cypriot resident company may enjoy full protection in all EU Member States, as well as by the signatories of all major IP treaties and protocols.

The new provisions provide exemptions from tax of the income related to IP. More specifically:

80% of worldwide royalty income generated from IP owned by Cypriot resident companies (net of any direct expenses*) is exempt from income tax.

80% of profit generated from the disposal of IP owned by Cypriot resident companies (net of any direct expenses*) is exempt from income tax.

Any expenditure of a capital nature for the acquisition or development of IP is claimed as a tax deduction in the year in which it was incurred and the immediate four following years on a straight-line.

All the above exemptions are also available for IP acquired or developed before January 2012

Overall an effective tax rate of 12.5% one of the lowest in the EU is applied. The amount subject to tax under the new rules is calculated by deducting the writing down allowance, the costs (including interest) of financing the acquisition or development of the assets and any other direct expenses from the revenue earned, and dividing the resultant amount by five. Applying the Cyprus corporate income tax rate of 12.5% produces an effective tax rate of 2,5% of the net income.

This rate compares very favourably with the competition: the United Kingdom’s optional new “patent box” regime gives an effective rate of 10%on relevant income. The Irish scheme is more complex and it is not possible to directly compare rates, but it will generally produce a rate close to the UK rate. The Luxembourg and Netherlands schemes are somewhat better, with effective tax rates of 5.76%and 5% respectively, but they are both considerably less beneficial than Cyprus.

Following the introduction of the IP box, considerable savings can be achieved by locating the IP owner in Cyprus and having it license the use of the rights direct to the end users, eliminating (or at least reducing) foreign withholding taxes via a double tax agreement or the EU Interest and Royalties directive, which provides a uniform tax regime for royalties paid throughout Europe.

In addition to tax savings, the elimination of a corporate layer in a different jurisdiction will allow considerable savings to be made in administrative and compliance costs.

The new rules will also enhance the degree of legal and jurisdictional protection, given that the legal and corporate governance affairs of the IP structure will be governed by the laws of Cyprus, so ensuring an increased level of legal certainty, asset protection and predictability.

Cyprus’ wide double tax treaty network and access to the EU Interest and Royalty Directive serve as additional means for the group to achieve tax optimization when it comes to IP exploitation through Cyprus.

Example

Assume that a Cyprus IP company licenses its IP to its operating foreign Companies and in return it receives royalty income of €20.000 per year. The structure looks as follows: The expected annual tax for the Cyprus IP Company will be as follows:
Annual royalty income 100,000
Direct expenses (say) (20,000)
Net income 80,000
80% deemed deduction (64,000)
Taxable income 16,000
@12.5% income tax 2,000
Effective tax rate 2.5%

VAT

The acquisition of intellectual property rights from anywhere in the world by a Cyprus company is treated as a service rendered to the company which will create an obligation for it to register for VAT and to account for VAT on services received in accordance with the reverse charge rule. No registration obligation will be created if the intellectual property right is developed organically rather than being purchased.

If the company charges royalty fees to taxable persons within the European Union area it will also have to register for VIES.

Conclusion

The new regime provides very attractive opportunities for structuring the exploitation of IP assets through Cyprus and in particular through the use of Cyprus-resident IP owners, especially in the context of Cyprus’s extensive network of double tax treaties under which foreign withholding taxes on royalty income are either eliminated altogether or substantially reduced.

In most cases immediate economic and tax savings can be achieved by transferring intellectual rights currently held by entities located in low or no tax jurisdictions to Cyprus resident companies in order to take advantage of the new exemptions. The transfer of IP rights into a Cyprus company will not give rise to any form of taxation in Cyprus and the new benefits and substantial exemptions will become available as soon as the asset is transferred.

The EU Directives and Regulations relating to IP protection apply and have been introduced into Cyprus domestic legislation. With a single IP registration process in Cyprus IP rights owned by Cyprus companies may enjoy full protection in all EU Member States.

How Global Premier Can Help you

Set up Cyprus IP holding structure
Advise on Corporate Statutory Compliance matters
Advise on Existing IP – Transfer to Cyprus
Ongoing Support after initial set-up
Cyprus is signatory to the following international conventions relevant to IP
EC Regulation on the Community Trademark (CTMR)
Convention Establishing the World Intellectual Property Organization (WIPO)
The Madrid Agreement Concerning the International Registration of Marks (Madrid Agreement, MMA) and Protocol to the Madrid Agreement
The Patent Cooperation Treaty (PCT)
Berne Convention for the Protection of Literary and Artistic Works
Paris Convention for the Protection of Industrial Property
Geneva Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of their Phonograms
WIPO Performance and Phonograms Treaty (WPPT)
Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations
Trademark Law Treaty
WIPO Beijing Treaty on Audio-visual Performances

Take advantage of the Cyprus “IP Box” Tax Regime

Cyprus offers the lowest tax regime on IP rights in Europe (maximum 2%) while protected by EU regulations on IP and by the fact of Cyprus being a member of all major international IP treaties and protocols.

To take advantage of the Cyprus low tax regime on IP you do not need to have the IP registered in Cyprus; it may be registered anywhere in the world but through a Cyprus company (i.e. the Cyprus company will be the registered holder of the IP).  IP includes the following intangibles:

Copyrights (such as films, sound recordings and musical works, broadcasts, publications, software programs, literary works, scientific works, etc.);
Tademarks and designs;
Patents.

Maximum 2% Tax on Profits generated from IP

Having any type of intellectual property registered through a Cyprus company will benefit you from enjoying an 80% tax exemption of your worldwide income from IP use (lease or sale).  In other words, the maximum effective tax rate on your income generated through the use of your IP through Cyprus will be as low as 2%, while at the same time benefiting from Cyprus’ wide double tax treaty network.

Why Global Premier?

What separates us from our competitors is that our services don’t end with the registration of your company. We offer a wide range of additional services others can’t or just won’t offer, such as lifetime free support.

Whilst most providers either specialise on personalized consultation at relatively high rates or run bulk registration factories without any support, we want to offer the positive aspects of both types.

Therefore Global Premier combines professional advice, worldwide registration services, reasonable fees, customized order processing, lifetime support and fast processing. Where others see company formation services as a bulk registration with no support and no individual assistance, we do care about your business needs.

Should you have any question or matter
You would like to discuss or clarify with us
Or
Should you like to receive further Information
About our services and fees, …

Our multi-lingual team of business advisors is happy to assist you with all upcoming questions and issues in relation to your company.

You may call or email us, and we will be happy to assist you in a fast and efficient manner.

You can also come and visit us at our Limassol offices to discuss issues face to face if you prefer. Just arrange an appointment and we will be happy to meet with you.

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