Setting up a Corporate Advisory and/or Financial Intermediary in Switzerland, Abu Dhabi Global Market (ADGM) or Dubai International Financial Centre (DIFC)

setting up of a corporate advisory or financial intermediary abu dhabi adgm dubai difc geneva

04 Feb 2019 Setting up a Corporate Advisory and/or Financial Intermediary in Switzerland, Abu Dhabi Global Market (ADGM) or Dubai International Financial Centre (DIFC)

This chart helps you to briefly compare the procedures of setting up of an corporate advisory or a financial intermediary in Switzerland and UAE. In UAE we take care of Abu Dhabi Global Market (ADGM) and DIFC in Dubai.

 

  SWITZERLAND[1] ABU DHABI GLOBAL MARKET

(“ADGM”), UAE

DUBAI INTERNATIONAL FINANCIAL CENTRE (“DIFC”), UAE
Standard Company Set-Up

(Corporate Advisor which does not have access to client money flow but coordinates money deals)

SRO Affiliation for the Company

(If the Corporate Advisor is also a Financial Intermediary who has access to client money flow)

Regulatory Regime N/A. Must be affiliated with a Self-Regulatory Organisation (“SRO”). Regulated by the ADGM Financial Services Regulatory Authority (“FSRA”). Regulated by the Dubai Financial Services Authority (“DFSA”).
Regulatory Status N/A. Financial Intermediary. Prudential category 4 firm.
Structure (i)    Company Limited by Shares (Société anonyme, Aktiengesellschagt) (“SA”); or

(ii)   Limited Liability Company (Société à responsabilité limitée, Gesellschaft mit beschränkter Haftung) (“Sàrl”).

 

(i)    Company Limited by Shares; or

(ii)   Foreign Recognised Company (Branch).

 

Permitted/Authorised Activity (i)    Arranging deals in investments;

(ii)   Advising on Financial Products.

Controlling client money based on trading powers. (i)    Arranging deals in investments;

(ii)   Advising on Financial Products.

Mandatory Appointments & Service Providers  One (1) member of the board of directors or member of the management must be Swiss resident. Money Laundering and Reporting Officer.

Functions of Money Laundering and Reporting Officer can be outsourced.

Money Laundering and Reporting Officer (must be UAE resident);

(i)    Compliance Officer (must be UAE resident);

(ii)   Senior Executive Officer (must be UAE resident); and

(iii)  Finance Officer.

Functions of Money Laundering and Reporting Officer and Compliance Officer can be combined and outsourced.

Audit Requirement External audit is required. However, it may be waived if the following conditions are met (opting-out):

(i)    Company counts less than ten (10) employees;

(ii)   Upon the approval of all shareholders.

Financial audit and AML audit are required. (i)    External Auditors (must be ADGM approved); and

(ii)   Internal Auditors.

(i)    External Auditors (must be DFSA approved); and

(ii)   Internal Auditors.

Professional Indemnity Insurance N/A Required
Approval Process:

Steps and Requirements

Incorporation Stage:

The following documents and tasks need to be submitted and fulfilled:

(i)    Initiate bank account opening and deposit share capital prior to the formation of the company;

(ii)   The funds in the amount of the paid-up share capital must be deposited in a special account with a bank in Switzerland which is licenced to act as a depository;

(iii)  Submit company incorporation application forms to the Commercial Register of the relevant canton, including:

(a)   Name of the company;

(b)   Objects of the company;

(c)   Articles of Association;

(d)   Share Capital;

(e)   Names of the corporate bodies (quota holders if an Sàrl; for SA and Sàrl, board of directors, auditors).

(iv)  Submit respective due diligence documents for the board members and the shareholders/quotaholders to the notary; and

(v)   Appointing an auditor (if required) and a review body.

SRO Affiliation Stage:

In addition, the following documents and tasks need to be submitted and fulfilled:

(i)    SRO membership application;

(ii)   Organisation chart dated and signed by member of the board of directors;

(iii)  Detailed description of the main activities of the company;

(iv)  Confirmation by the auditor that it accepts the mandate as an Anti-Money Laundering auditor;

(v)   Due diligence documents for accredited persons (i.e. MLRO, members of the board etc.)

 

Pre- Approval Stage:

Submit first draft of the Regulatory Business Plan to the FSRA. Once initial comments are received from the FSRA prepare for the FSRA In-Principle Approval Stage.

Pre- Approval Stage:

Submit first draft of the Regulatory Business Plan to the DFSA. Once initial comments are received from the DFSA, prepare for the DFSA In-Principle Approval Stage.

FSRA In-Principle Approval Stage:

(i) Submit the following documents to the FSRA:

DFSA In-Principle Approval Stage:

(i) Submit the following documents to the DFSA:

(a)   Revised Regulatory Business Plan; (a)   Revised Regulatory Business Plan;
(b)   Anti-Money Laundering & Counter Terrorist Finance Manual; (b)   Anti-Money Laundering & Counter Terrorist Finance Manual;
(c)   Compliance Manual; (c)   Compliance Manual;
(d)   Compliance Monitoring Programme; (d)   Compliance Monitoring Programme;
(e)   Risk Management Manual; (e)   Compliance & AML Training Plan;
(f)    Remuneration Policy; (f)    Risk Management Manual;
(g)   Financial projections: One (1) year financial projections – opening balances of the statement of financial position (balance sheet) from day one (1) of operations; cash flow forecasts for each month; monthly profit and loss accounts, split into income streams;  forecast of capital resources versus capital requirement;  and monthly statement of financial position (balance sheet); (g)   Financial projections: quarterly cash flow forecast; quarterly profit & loss account, split into income streams; quarterly forecast of capital resources versus capital requirement; and quarterly balance sheet – commencing at the time of authorization and on a quarterly basis for each of the first three (3) financial years;
(h)   Evidence of source of funds for the company’s initial capital resources (e.g. bank reference); (h)   Evidence of source of funds for the company’s initial capital resources (e.g. bank reference);
(i)    Last audited parent and/or group company’s accounts (if applicable); (i)    Last audited parent and/or group company’s accounts ( if applicable);
(j)    Applicable forms for the company and its individuals; (j)    Applicable forms for the company and its individuals;

 

(k)   Due diligence documents on the individuals of the company; (k)   Due diligence documents on the individuals of the company;

 

(l)    Board minutes approving the establishment of the company;

 

(l)    Board minutes approving establishment of the company; and
(m)  Copy of the company’s dispute resolution mechanism in the event of any shareholder dispute;

 

(m)  Letter of good standing from the company’s home regulator (if the parent is regulated).
(n)   Letter of good standing from the company’s home regulator (if the parent is regulated); and

 

 
(o)   Copies of any committees’ terms of reference.

 

 
After receipt of the abovementioned documents, the FSRA will conduct their initial review of the application.  After completion of the initial review, an “In Principle Approval” will be issued to the company. After receipt of the abovementioned documents, the DFSA will conduct their initial review of the application.  After completion of the initial review, an “In Principle Approval” will be issued to the company.
  Incorporation Stage:

This is the stage where the company needs to get incorporated. The following documents and tasks will need to be submitted and  fulfilled:

(i)    Submit company incorporation application forms to the ADGM Registrar;

(ii)   Secure premises;

(iii)  Initiate bank account opening and deposit share capital; and

(iv)  Apply for Establishment Card.

Incorporation Stage:

This is the stage where the company needs to get incorporated. The following documents and tasks will need to be submitted and fulfilled:

(i)    Submit company incorporation application forms to the DIFC Registrar;

(ii)   Secure premises;

(iii)  Initiate bank account opening and deposit share capital; and

(iv)  Apply for Establishment Card.

  FSRA Authorisation Stage:

Submit the following documents to the FSRA:

(i)    Certificate of Incorporation;

(ii)   Lease Agreement; and

(iii)  Share capital deposit confirmation letter.

Upon submission of the abovementioned documents, the FSRA will issue the final license and authorize the company to carry out the respective activity in or from the ADGM.

DFSA Authorisation Stage:

Submit the following documents to the DFSA:

(i)    Certificate of Incorporation;

(ii)   Lease Agreement; and

(iii)  Share capital deposit confirmation letter.

Upon submission of the abovementioned documents, the DFSA will issue the final license and authorize the company to carry out the respective activity in or from the DFSA.

Timeline Total timeline: Two (2) – four (4) weeks. Total timeline: Two (2) – four (4) weeks.

 

Total timeline: Twelve (12) – fourteen (14) weeks.

Breakdown of timeline:

Pre-Approval Stage: Two (2) weeks.

In Principle Stage: Eight (8) to ten (10) weeks. 

Incorporation Stage: One (1) week.  

FSRA Authorisation Stage: One (1) week.

Total timeline: Nineteen (19) to twenty one (21) weeks.

Breakdown of timeline:

Pre-Approval Stage: Two (2) weeks.  

In Principle Stage: Fifteen (15) to seventeen (17) weeks.

Incorporation Stage: One (1) week.  

DFSA Authorisation Stage: One (1) week.

Capital Requirement Higher of :

(i)    CHF 100,000 for an SA ; or

(ii)   CHF 20,000 for an Sàrl.

 Higher of:

(i)    USD 10,000; or

(ii)   6/52 of the annual audited expenditure.

Taxation  Currently: 12 to 25%, depending on the canton.

New law should enter into force on 1 January 2020 (RFFA)[2]:
13-14% for all cantons.

N/A.
Regulator’s, Registry’s & Notary Fees Commercial Register Registration Fee:

Approximately CHF 500 to CHF 1,000

SRO Affiliation Fee:

Approximately CHF 1,250

FSRA Authorisation Fee:

Approximately USD 10,000

 

DFSA Authorisation Fee:

Approximately USD 15,000

 

  Notary Fee:

Approximately CHF 4,000

 

SRO Annual Fee:

Approximately CHF 3,000

FSRA Annual Fee:

Approximately USD 10,000

DFSA Annual Fee:

Approximately USD 15,000

      Appointment fee of approved persons:

Approximately USD 500 per person

Appointment fee of approved persons:

None

      ADGM Registration Fee:

Approximately USD 15,000

DIFC Registration Fee:

Approximately USD 20,000

      ADGM Annual Fee:

Approximately USD 13,100

DIFC Annual Fee:

Approximately USD 12,000

 

 

[1] In Switzerland, there is no license required to carry out the proposed activity as such activity falls under the ambit of corporate advisory firms. Corporate advisors acting as financial intermediary must be affiliated with a Self-Regulatory Organisation, which is a straightforward process and involves more checks and balances than a standard company (see detail in the chart). The information on the left-hand side relates to the incorporation of a corporate advisory firm which does not have access to client money flow but coordinates money deals; the information on the right-hand side relates to the affiliation with a Self-Regulatory Organisation of a corporate advisory firm acting as a financial intermediary. Please note that the right-hand side steps must be undertaken upon the incorporation of the company (i.e. upon the left-hand side steps being completed). It is also important to note that from 1 January 2020, corporate advisors will need to apply for a “light” registration with the Swiss Financial Markets Supervisory Authority (FINMA).

 

[2] Réforme fiscale et financement de l’AVS



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