Publication
2 universal tips for opening a foreign bank account for a company
When a company considers opening an overseas account, it faces several complex questions. What security policy features should be known in advance? How can one strengthen their application for a positive decision? What factors influence the overall process?
We are well aware of all the pitfalls in this matter. Over the past 8 years, Antwort Law lawyers have assisted in opening over 1000 foreign corporate accounts in the UK, the UAE, Singapore, the USA, and 20 other business-friendly countries.
Certainly, each case is unique and should be considered in the context of the entire situation. However, thanks to our practice, we have identified 2 universal factors you can consider in advance to influence the bank's decision positively.
The first "code" word is substance. It is important to demonstrate physical or economic presence in the country where the account will be opened, as this is a key factor for any non-resident company. How can this be done better? Let's consider a few examples.
- Local director: Choosing a citizen or resident of the country for this position significantly increases the chances of success. Such an employee can also provide their home address as a legal address for your company, which is especially suitable for consulting businesses where a large staff is optional.
- Local office: Carefully choose the location, ensuring the address is not mass, virtual, or discredited in the country's banks. Keep in mind that many banks not only check the address against their databases but also conduct actual verification. We recommend registering the company only through trusted contractors.
- Local phone number: In some countries, obtaining a SIM card is difficult, and the number must always be accessible. Antwort Law specialists will help you choose the correct phone number and tariff and advise you on how to properly answer calls from the bank.
- Local domain and corporate email: Such details demonstrate the thoroughness and seriousness of your intentions regarding business operations in the country.
The second factor that can positively influence the bank's decision is a well-thought-out advance response to the question, "Why do you want to open an account in the country?" Despite the seeming simplicity of the question, we recommend paying special attention to it and supporting the answer with data.
For example, you can cite your desire to be closer to customers or suppliers in that country as one of the reasons. Attach supply or service contracts with local partners to your response, and if they don't exist yet, obtain offers from potential counterparts that you can show to the bank.
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... It's always a good idea to prepare answers to the key questions that a bank may have! The list of questions frequently asked by bankers is quite extensive and goes beyond just understanding the reasons for opening the account. Among the most common questions is the inquiry about where and under what circumstances the director and shareholder of the company met. Therefore, Antwort specialists always prepare clients for interviews when opening a bank account ... |
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All these aspects can increase the chances of a positive decision. Of course, there are other components in the substance theme, such as local employees, submission of accounting and tax reports in the country, etc. We will provide more details on this in our upcoming materials.
Opening a foreign account requires time and knowledge. We value our clients' time, so we are happy to take care of all the documentary issues, explain the process, and offer a solution tailored to your needs. By collaborating with Antwort Law, you can rest assured about the legal aspects of your business in a new country. We would be delighted to assist you and invite you to schedule a free consultation with our specialists.
Lidia Ivanova,
International Lawyer
Antwort Law
FAQ
How long does it take to open a corporate account abroad?
Opening a foreign corporate account takes from 2 weeks to 3 months. This is due to the requirements of financial regulators for banks and payment systems to conduct thorough and multi-stage checks of their clients. The final account opening time depends on various factors, such as the country, the type of business, the choice of the bank, the nationality of the founder and director, public information about them and the company, the availability of a complete set of documents, and other factors.
Why does the bank refuse to open an account?
The reasons can be diverse, but the four most common ones are:
1. Errors in document preparation.
2. Incomplete data, brief and unconvincing answers, lack of logic and structure in responses, and the absence of a well-thought-out company history.
3. The nationality of the founders and/or directors.
4. The company's activities or insufficient turnover. For example, it can be challenging for cryptocurrency companies to open an account due to the nature of their business, and many banks evaluate the potential turnover of the company during the selection process.