Guide to Licensing Investment Companies
Regulation
The procedures for obtaining an investment company license and its activities are regulated by the Law of the Republic of Armenia "On the Securities Market" (hereafter referred to as "the Law"), Regulation 4/01, Regulation 4/02, and Regulation 4/05 approved by the Board of the Central Bank of Armenia (CBA), as well as other laws and legal acts of the Republic of Armenia. These are published on the Legal Information System of Armenia's website and the official website of the CBA.
Description
An investment company is a joint-stock or limited liability company licensed to provide investment services under the Law and the normative legal acts adopted based on it. Its activities include providing investment services, either individually or alongside non-core services.
Investment and non-core services are defined in Articles 25 and 26 of the Law, respectively.
Activities related to investment funds, as defined by the Law "On Investment Funds" of Armenia, are not considered investment services.
Capital and Significant Participants
Before being licensed, an investment company must fully pay its charter capital, either to the Central Bank of Armenia or into a cumulative account opened with a commercial bank operating in Armenia and not affiliated with the company.
The minimum total and charter capital, as well as key economic norms and limits for regulating an investment company’s activities, are defined in Chapter 7 of the Law and Regulation 4/02.
Individuals planning to hold 10% or more participation in an investment company, referred to as significant participants, must obtain prior approval from the Central Bank, as regulated by Articles 54-57 of the Law and Section 3 of Regulation 4/01.
Managers
Employees considered managers of an investment company, as listed in Subsection 1 of Article 58 of the Law, must obtain qualifications, meet the required professional standards, and be registered with the Central Bank, in accordance with Regulation 4/05.
Premises
The premises and technical equipment used for the activities of the investment company must meet the requirements defined in Section 5 of Regulation 4/01, which are necessary to ensure the proper functioning of the company.
Licensing Procedure
The list of documents required to apply for an investment company license is provided in Article 36 of the Law and Chapter 5 of Regulation 4/01. These documents must be submitted to the Central Bank electronically, by registered mail, or in person in paper form through the CBA's reception. After submitting the complete and reliable documents and meeting the necessary requirements, the Central Bank Board will make a decision within one month to either issue a license or reject the application.
The Central Bank Board may reject the application based on the grounds outlined in Article 38 of the Law.
From the moment the company is registered with the Central Bank, it acquires legal entity status and is considered licensed.
A license is issued for one or more types of investment services. It cannot be issued solely for the provision of non-core services. An investment company can only provide services for which it has received a license. To provide additional investment services, the company must obtain an additional license. Unless otherwise stated by the Law, the company may offer all non-core services.
An investment company can open branches and representative offices in Armenia or foreign countries, in accordance with Articles 45-48 of the Law and Chapters 9 and 10 of Regulation 4/01, which may operate from the moment of registration with the Central Bank.
Taxes, Duties, and Other Fees
The investment company must pay taxes in accordance with the procedures, rates, and deadlines set by the tax code of the Republic of Armenia. Additionally, it must pay an annual state duty of 500,000 AMD to engage in licensed activities.
Attention: This document is a summary of the requirements set forth in the legal acts regulating the activities of investment companies. For more detailed information, it is necessary to review the full legal acts in force.