The fintech sector in the Czech Republic is growing in a frantic pace. The local market has helpfully opened its doors not only to large players who have recently logged in and work successfully, but also to fintech startups.
Large companies have already managed to acquire their own fintech solutions, the development of which does not stop even for a second.
Startups are looking for their niches. And this means that no matter what category your business belongs to, registering a fintech company in the Czech Republic is a great idea.
In this article we have collected for you the main subtleties of starting a fintech business in the Czech Republic. But you can dig deeper. You are welcome to get an answer to any specific request by ordering legal advice on how to register a fintech company in the Czech Republic.
So, we offer you answers to 10 typical questions that companies may ask at the entrance to the fintech market in this jurisdiction:
Who is the main regulator?
The Czech National Bank (CNB) is the regulatory authority for all financial services. If you need detailed answers to questions about obtaining a license for financial services in the Czech Republic, then contact us through the order form.
Can I transfer activities from EU to the Czech Republic?
If you wish to register a fintech company in the EU, it will be a good option also to provide services in the Czech Republic. For this purpose, you will need the appropriate passport only.
You don’t need any Czech license in this case. Meanwhile, please be informed that the transferred investment services are not provided indefinitely, but on a temporary basis only.
To establish a subsidiary in the Czech Republic and find out what documents are needed for this and what sequence of actions, please contact us.
Under what types of activities do I need to get a license in the Czech Republic?
Investment services, such as investment advice relating to transactions with financial instruments, requires a special authorisation. Also, if you want to establish a payment system in the Czech Republic or organize electronic money transactions in the Czech Republic, you also need to log in and get a license.
Is it possible to obtain a license for a fintech company in the Czech Republic remotely?
Fintech, which cannot transfer its regulated activities to the Czech Republic, must register a company here, and obtain a license for financial services in the Czech Republic. Without this, fintech products cannot be offered.
Are financial innovations supported in the Czech Republic?
There are no clear protocols of interaction between fintech between Czech and foreign regulators. Therefore, the Czech Republic so far works without categorical regulatory exceptions or privileges for fintech. However, this will not last long.
What about the use of AI?
If you intend to establish an investment company in the Czech Republic to provide automated advice, you will need to obtain a license to provide investment services in the Czech Republic. Meanwhile, there are no special rules regarding automated investment advice (robo-advice).
Are there any restrictions as to sales and marketing of financial services?
Most of the rules are written in the framework of the EU legislation, such as the Directive on unfair commercial practices, MiFID II. If you need a legal audit of a company in the EU for compliance with legal requirements, we can provide a comprehensive assistance.
Much depends on where your business is conducted. If the services are provided exclusively outside the Czech Republic, they will not fall into the Czech licensing regime. You will definitely need a license, if you operate inside the country.
A business is considered to be conducted in the Czech Republic if:
- services, both offline and online, are advertised inside the country;
- the website of the service provider is available in Czech or is otherwise targeted to Czech customers;
- Local customers can interact with the service provider online through the provider's website.
What is being done to fight money laundering?
If you wish to establish a business in the Czech Republic to provide services related to digital currencies, then you will be required to follow anti-money laundering procedures and procedures to prevent the financing of terrorism. If you want to establish an investment company in the Czech Republic, you will need to follow strict KYC rules.
Is blockchain usage regulated in the Czech Republic?
Today, there are no regulations or guidelines regarding the use of blockchain technology, with the exception of the general data protection principles set forth in the GDPR. If you want to order legal advice on implementing blockchain in business in the Czech Republic, we can help.
What are the trends in the development of the fintech industry in the Czech Republic?
First of all, it is worth noting the constant desire for innovation. The fintech market in the Czech Republic is constantly replenished with new services and innovative solutions.
Most of them relate to banking and financial services, and are usually intended for mobile phones, but not only.
In addition to the above, you may still have many other questions. For example, what package of documents is needed to register a fintech company in the Czech Republic, how much does a license for payment services in the Czech Republic cost, and others. Lawyers with IQ Decision UK are ready to answer any specialized question about establishing a fintech business in the EU.