25.06.2018

Foreign banking for non-resident clients has recently become a constant source of news. And if some of them turned out to be quite predictable (especially for those who in one way or another used the services of foreign financial institutions over the past years), then others will still have to get used to.

If earlier banks fought for a future client, offering Better conditions, and clients could afford to choose from a variety of options, now banks carefully select a "suitable" client, taking into account a variety of factors - from the jurisdiction of the company to the business biography of its beneficiary and the legality of the origin of his funds. Under the pressure of international organizations and national regulators in the field of banking services for non-residents, there is a constant "crackdown".

Nonetheless, foreign bank A bank account has been and still remains an indispensable tool in international business, since the task of opening a bank account arises for almost everyone who registers a business abroad or expands its borders. Therefore, further - about everything in order.

Why do you need an overseas bank account?

Corporate account in a foreign bank is necessary for convenience of calculations companies with their business partners (customers, suppliers), accumulation of monetary assets, payment of mandatory payments, maintaining salary projects, use of corporate bank cards, etc. Such an account can be opened both in the same country in which the company is registered, and in another country or countries.

One of the most important advantages of opening a foreign account specifically for a foreign company (and not for an individual) is no currency restrictions provided by Russian legislation for currency residents of the Russian Federation. For foreign companies do not apply obligations to notify the tax authorities about opening a foreign account, submitting reports on the movement of funds on the account, as well as restrictions on crediting funds to the account.

For citizens personal foreign account is needed in case of employment or obtaining a residence permit abroad, ownership of foreign real estate and in many other cases. In addition, many clients simply choose to keep and/or invest some of their funds abroad in order to preserve or increase their personal or family wealth. Only for certain categories of citizens (senior officials, civil servants) opening foreign accounts and using foreign financial instruments is prohibited by law.

The main disadvantage of a personal foreign account is its very limited functionality. The currency legislation of the Russian Federation allows residents of the Russian Federation to credit to such an account only those categories of funds that are directly named in the law, classifying all other operations as illegal. Such restrictions are removed only if the person loses the status of a currency resident of the Russian Federation.

Account types

Foreign banks usually offer the opening of checking and/or savings accounts.

Estimated accounts are intended for regular transactions involving frequent crediting and debiting of funds on the account, which is necessary when the company is maintaining a normal operating activities(trade in goods, provision of services, etc.). Some accounts can operate in the settlement mode, however, they require maintaining a constant minimum balance in the account in a certain amount or placing an investment portfolio.

Savings (investment) accounts are opened for the purpose of saving and/or investing Money client and, as a rule, cannot be used for current settlement transactions.

How to choose a foreign bank?

Currently, choosing a bank to open a current account for a foreign (especially offshore) company is becoming an increasingly difficult task. It depends on many factors, starting with the ownership structure of the company and the type of its activity, and ending with the specifics of the policy of the national banking regulator.

Here are just a few of the questions that should be answered when choosing a foreign bank:

• Does this bank work with companies (including those from offshore jurisdictions) and individuals - non-residents?
• Does the bank offer checking accounts (i.e. accounts for frequent incoming and outgoing transfers)?
• Will this bank accept a client with this type of activity, with these beneficiaries, with these business partners and directions of payments?
• in what currencies can payments be made (this depends on the availability of an appropriate network of correspondent banks) and are there any currencies you need among them?
• what are the bank rates?
• what are the ratings, reputation, financial performance and prospects of this bank?
• and much more.

Therefore, in order to choose a foreign bank for opening a corporate or personal account abroad, we recommend that you contact only those specialists (professional intermediaries and bank agents) who know the current (and constantly changing!) situation in the field of opening accounts and can objectively assess the chances of opening an account taking into account all the factors inherent in a particular client and bank.

In which country to open an account?

For the purposes of opening corporate accounts for foreign (including offshore) companies, banks can be divided into three main groups:

1. European banks. Basically (except Switzerland, Liechtenstein and Montenegro) these are the banks of the member countries of the European Union, which are subject to the requirements of the pan-European regulator - the ECB. Within this group are:

• banks of the Baltic countries (Latvia, Lithuania, Estonia);
• banks in Cyprus;
• banks of Central Europe (Poland, Hungary, Czech Republic, etc.);
• Western European banks (Austria, Liechtenstein, Luxembourg, Switzerland);
• other banks (Montenegro, etc.)

Banks of this group continue to be popular when opening corporate accounts for foreign companies. Many of them have Russian-speaking customer support.

However, most European banks (as well as any other) are characterized by increasingly lengthy processing of applications for opening an account, requesting various additional information from the applicant, and also (especially for Western European banks) rather high tariffs. And, most importantly, the banks of most of these countries today moved away from the practice of opening and servicing accounts of offshore companies(for example, it is no longer possible to open an account in a Latvian bank for an offshore company or for an LP or LLP partnership formed from offshore companies).

Only a few banks, despite the general negative attitude towards offshore companies, continue to consider opening investment accounts of offshore companies on favorable terms for the bank (namely, investing in bank products or maintaining a significant minimum balance), of course, with the client fully satisfying all other requirements.

2. Asian banks(Hong Kong, Singapore).

Asian banks as a whole are focused on business, one way or another working in the Asian region or with partners from it. They are also characterized by a general trend towards deoffshorization and strengthening of due diligence procedures.

Hong Kong banks today have practically refused to open accounts for residents of Russia and other CIS countries or companies with beneficiaries from such countries. In order to open a bank account in Hong Kong, a face-to-face interview with a Bank manager in English or Chinese is always required without the help of an interpreter (directly in Hong Kong). At the same time, banks consider only those companies that have a real office in Hong Kong (it should be borne in mind that such companies are subject to taxation in Hong Kong).

To date, only Singaporean companies can open a bank account in Singapore, and their directors and shareholders must be residents of Singapore. The director must exercise real authority to manage the company and have exclusive access to its bank account.

A relative disadvantage of Asian banks is also more complicated communication between the bank and the client, due to the lack of Russian-speaking support, as well as a significant difference in time zones (which is important for the European part of Russia).

3. Offshore banks(Saint Lucia, Mauritius, Seychelles, Saint Vincent and the Grenadines, etc.).

Offshore banks are banks in offshore jurisdictions that have traditionally specialized in servicing non-resident clients. However, today such banks not only do not have any significant advantages over banks from onshore countries, but also lose to them - primarily because of the offshore image and extremely limited possibilities for settlements with certain countries and in certain currencies.

The point is that most developed countries have a negative attitude towards offshore banks, which complicates the establishment of correspondent relations with them and prevents payments. In particular, for this reason, offshore banks (with the exception of banks in Mauritius) have recently experienced difficulties with settlements in US dollars. Therefore, if you need to pay in USD, as well as with American / European / Russian partners, opening an account in an offshore bank is usually not advisable.

On the other hand, the procedure for opening an account in an offshore bank today practically does not differ from similar procedures in other banks. As elsewhere, the client is obliged to submit the required package of personal and / or corporate documents as part of the “due diligence” and “know-your-customer” procedures. An application for opening an account can be considered long time. An offshore bank, like any other, will refuse to open an account if the potential client does not comply with the bank's policy and the client exceeds the risks for the bank. During settlement service offshore banks can, just as regularly as conventional banks, request supporting documents for current client transactions.

We also add that foreign banks should not be confused with banks operating in Russia with foreign capital, which, although they operate under the corresponding foreign brands, but, like any Russian banks, are subject to Russian legislation and the requirements of the Central Bank of the Russian Federation. The foreign banks referred to here are banks located outside the Russian Federation and subject to the relevant foreign regulators. In Russia, such banks can operate only in the form of representative offices officially accredited by the Central Bank of the Russian Federation, which do not open accounts and do not carry out banking operations.

Procedure for opening an account in a foreign bank

In order to open an account in a foreign bank, you must:

1. Choose a foreign bank.
2. Personally visit the bank's office directly abroad, or meet with a bank representative or contact authorized bank partners in your country. A number of banks (in particular, banks in Latvia, Cyprus, Switzerland, Mauritius, Saint Lucia) allow you to open accounts remotely (without going to the bank). In other cases, a personal visit of the future account holder to the bank branch is required (typical for banks in Poland, Hungary, Hong Kong, Singapore, etc.).
3. Fill out bank forms and provide a complete set of documents required by the bank. If necessary, also provide any additional documents and explanations.
4. Waiting for the decision to open an account.

Each bank has its own requirements for the form and content of client documents. However, generally speaking, the following is required from the client (opening an account for the company):

Firstly, a set of corporate documents (originals or certified copies - depending on the requirements of a particular bank).

Secondly, information about the activities of the client's company, including:

• a description of the business of the company for which the account is opened (often also copies of contracts and invoices confirming the declared activities);
• data on counterparties for incoming and outgoing payments;
• expected parameters of work on the account (annual turnover, number and frequency of operations, etc.).

The activities of the client's company within one opened account must be fully understandable bank, legal and more or less homogeneous(ideally, one account - one type of activity). The declared activity must be similar to the existing resident business of the beneficiary of the company.

Thirdly, the client provides information about the beneficial (that is, actual, ultimate) owners of the company. This information includes:

• personal identification documents;
• proof of residential address;
• data on sources of income (this can be any documents confirming the legal sources of origin of funds: certificate of employment, employment contract, data on entrepreneurial activity, savings, etc.);
• bank statements and statements;
• letters of recommendation from significant business partners;
• names and activities of existing resident (for example, Russian) companies of the client (including links to their websites, other materials);
• resume with information about education and career (as noted above, it is important that the beneficiary has work / business experience in the area that is declared as the main activity of the company for which the account is opened).

Recently, banks pay special attention not only to data about the client (applicant) and his beneficiary, but also about his partners which should be as understandable and transparent for the bank as the future client himself. For example, if your counterparty is a British partnership (LLP, LP), then the bank may be interested in who and what is behind it, up to finding out the resident business of the beneficiaries of such a partnership. Further, the presence of a counterparty in any sanctions lists, or even just a relationship with third parties from such lists, may result in a refusal to open an account.

The term for consideration of an application for opening an account can currently be 2 months or more. There is no expedited application process. At the same time, there are no guarantees that the account will necessarily be opened.

If the application is approved, the client is assigned an account number, means of access to the online account management system are issued, bank cards(if necessary).

Compliance. Due Diligence. Know-Your-Customer

These foreign words have long been familiar to everyone who has had to open foreign accounts and fill out bank forms.

Banking compliance is the bank's internal procedures for identifying and assessing the compliance of a client, based both on information provided by the potential client himself and obtained from other available to the bank sources. The Bank collects and analyzes such information, implementing the “know-your-customer” principle, and, in a broader context, the “due diligence” principle, which is used not only in banking practice, but also in business in general.

Compliance with these principles is not a whim of the bank: it is due to the need to comply with the requirements of the national (and for the EU countries also - supranational) regulator and regulations aimed at combating money laundering and terrorist financing (AML/CFT). This work has always been carried out by banks in one volume or another, however, in the last decade, the “rules of the game” have changed a lot in the direction of tightening. For example, failure to provide the bank with the documents required by it confirming the origin of the funds received, or a sharp deviation of the grounds (nature) of payments from those that were declared when opening an account, may well be the reason for its closure.

A relatively recent innovation is the requirement to specify in bank forms place tax residency company and its beneficial owners (as well as their tax identification numbers and information about the active or passive nature of the company's activities) for the purposes of implementing automatic exchange of information according to the CRS standard.

Another complicating factor was the policy of anti-Russian sanctions. In connection with it, both a Russian citizen directly and a foreign company, the shareholder or beneficiary of which will be a Russian, one way or another appearing on the sanctions lists, can be denied opening an account.

Considering that the approach of banks to assessing the compliance of a client has long ceased to be formal, when opening a foreign account, you must be ready to provide the bank not only with standard information about the company for which the account is opened, but also

• details of your existing resident business,
• identification and biographical details of the beneficial owners of the company (including detailed work experience),
• comprehensive information about the sources of origin of their funds,
• and other information required by the bank.

Therefore, adapting to the new rules means carefully and in advance documenting the operations of your foreign and resident business, personal income, sources of wealth, taxes paid, and not only while working with foreign account, but also for several years preceding the moment when it became necessary to open an account abroad.

Key trends in account opening

So, the choice of reliable foreign banks that are ready to service the accounts of non-resident companies (especially offshore ones) is currently very limited and continues to narrow. Why? Here are some reasons:

• Avoid offshore. Foreign banks reduce the share of offshore companies in their client portfolio or refuse to serve them at all (and the criterion may be not only the offshore jurisdiction of the company, but also the lack of real economic content - such companies are called "shell companies", shell companies). Somewhere it will happen at once, somewhere - in stages. For example, in the light of the well-known events related to the self-liquidation of the Latvian bank ABLV in the spring of 2018, many other banks stepped up the purge of their portfolios from "undesirable" clients. In Latvia, the decision to stop servicing shell companies' accounts was taken at the legislative level. In the very near future, other countries may follow this example, first of all, Cyprus, where the introduction of new requirements for banks is expected in the summer of 2018.
• Business reality. Preference is given to companies whose country of registration coincides with the country of the bank, or companies that have a real economic presence in their country (office, assets, personnel) financial statements and those who pay in it taxes, as well as having any connection with the country of the bank in which the account is opened.
• Understanding and transparency of the client. Banks seek to accept clients with a fully understandable business, a transparent source of income and the nature of cash flows, as well as with fully acceptable (by a number of parameters) beneficiaries and counterparties.
• Strengthening due diligence requirements. Such requirements continue to increase both in relation to potential and existing clients of foreign banks (in particular, on the identification of beneficiaries and documentary evidence of transactions).
• Close to zero odds foreign start-up companies (who are not yet able to confirm the relevant experience of previous activities and indicate counterparties), as well as companies representing “high-risk” business categories (for example, blockchain and cryptocurrencies, unlicensed forex, payment systems, gambling business, dual destinations, precious metals, etc.). Traditionally, banks are loyal (subject to other conditions) to international trading, forwarding and logistics activities, understandable IT projects, and financial services licensed in the EU countries.
• U.S. dollars. The situation with transfers in US dollars has deteriorated sharply (for example, Latvian banks, as well as a number of offshore banks, have completely refused to open accounts in this currency).
• Sanctions. The attention of banks to various sanctions lists and the relevant categories of individuals and companies has increased. The presence of "sub-sanctioned" persons among the declared beneficiaries or counterparties (or any connection with them) will result in a refusal to open an account.
• Clients from Russia. There is almost targeted discrimination Russian clients(in relation to clients from Russia and other CIS countries, a kind of “presumption of guilt” is formed). However, even such circumstances do not exclude the use of an individual approach and the search for acceptable solutions.
• Automatic exchange. In September 2018, during the practical phase of the automatic exchange of information on financial accounts according to the CRS standard, countries of the “second order” enter, including Russia, Switzerland, Austria and many classic offshore jurisdictions. This means that data on personal and corporate bank accounts (primarily accounts of companies with predominant passive income), whose beneficiaries are residents of the Russian Federation, will be sent to Russia by the tax authorities of the countries that have agreed to such an exchange.

  It is still premature to predict its results, however, if the automatic exchange is fully implemented, it will be possible to talk about a completely different level of transparency of tax information in the world.

Reading 6 min. Published on 26.01.2020

In the context of an unstable economic situation, the devaluation of the ruble and the bankruptcy of financial institutions, it is becoming increasingly important to place savings on accounts located outside national borders in more stable and reliable financial institutions. How to open an account in a foreign bank? This is what will be discussed in this article.

Opening an account abroad: the pros and cons of offshore

Opening offshore accounts is a traditional practice for many entities. This allows you to ensure a high level of safety of your savings, as well as beneficially reduce the tax base.

Now there is a gradual transition in favor of servicing the accounts of Russian individuals by foreign banks. Citizens transfer their savings to Liechtenstein, Andorra, Switzerland and Cyprus.

+’What are the advantages of this kind of offshore accounts:

• Firstly , the confidentiality of information regarding the account holder is maintained.
• Secondly , there is a complete removal from domestic economic risks.
• Thirdly , opening an account is very simple in most cases, the depositor will not even need to travel outside the country: all procedures will be carried out remotely.

As for the obvious disadvantages, among them are:

1. The need to interact with the tax service in matters of opening and maintaining a foreign account.
2. Difficulty in depositing funds into the account and withdrawing them from the account.
3. The lack of control by the national bank of a given country over the activities of financial institutions from other countries of the world, which creates some kind of insecurity for the client.

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It should be added that when choosing a foreign bank to open an account the stability of the political and economic situation in the country should also be assessed location of a financial institution.

Choosing the right bank to open a foreign account

Any foreign bank will charge a fee for opening an account from its foreign customers. At the same time, the most reasonable prices are put forward by banking institutions located in offshore zones (offshore banks). In order not to miscalculate the choice of a bank, it makes sense to consider the rates of the most popular of them.

Tariffs for opening an account in foreign banks

Bank	Country of registration	Account opening cost
BankofCyprus	Cyprus	300 euro
Norvik Banka	Latvia	300 euro
C.I.M. bank	Switzerland	700 euro
Valartis Bank	Liechtenstein	700 euro
ABLV BankLuxembourg	Luxembourg	500 Euro
AlSalamBank	Seychelles	500 dollars
ABC Banking Corporation	Mauritius	500 dollars
HSBC Bank	Singapore	1000 dollars
HSBC Bank	Hong Kong	3000 dollars

Is it possible to open a foreign account without leaving Russia?

Recently, Russian citizens have been able to open an account in a foreign bank remotely.

Now, in order to register your account, you do not need to travel to Hong Kong or Mauritius at all - just follow these steps:

1. Choose a suitable foreign bank.
2. Fill out the application form online and attach a package of necessary papers to it.
3. Wait for the bank's decision and pay for the account opening procedure.
4. Get details and place a minimum balance on the account.

Important point: Most modern banks offer foreign customers to use Internet banking mechanisms that allow you to manage your account remotely.

What documents are required to open a foreign account for a Russian citizen?

Each foreign financial institution requires from its clients its own list of papers that are necessary for making a decision on opening an account.

However, in most cases, individuals are required to submit:

• A copy of the passport certified by a notary.
• Original certificate of residence.
• Resume according to the established form in English.
• Documents confirming the source of income of the person.
• Certificate from the bank serving the client in the territory of his country.

Since opening an account can take place remotely, all of them are scanned and certified with an electronic digital signature.

Important point: In the online application, you will have to indicate the purpose of opening an account, as well as the approximate planned turnover of funds for it.

The procedure for opening an account abroad for an individual: instructions to help

Russian citizens got a real opportunity to open accounts abroad after Instruction No. 100 “On accounts of resident individuals in foreign banks” was adopted in 2001.

Important limitation: Russians have the right to open one or more accounts in foreign banks only in those countries that are members of international banking organizations(eg FATF).

After a suitable foreign financial institution is selected, taking into account existing legal restrictions, an individual must perform only two actions:

• Submit an application and receive a positive response from a foreign financial institution.
• Within one month after opening the account, notify the tax office about this.

It should be added that the Federal Tax Service will issue a notice to the citizen, which will become the documentary basis for the transfer of funds from the banks of this country to foreign financial institutions.

Important limitation: Individuals can open accounts in foreign banks for non-business purposes.

How to use the account: features of transferring money abroad

After an account in a foreign bank is opened, it remains to transfer funds from Russia to it.

How this process happens:

• Money transfers from Russia are treated as foreign currency payments and are governed by the relevant section of Russian legislation.
• To replenish an account, you need to open a current account in any Russian bank and transfer money abroad exclusively through it in the order of an international transfer.
• To transfer funds to the servicing client Russian bank you will need to submit papers such as a passport, an application and a copy of the agreement on opening an account in a foreign bank.
• From a foreign bank, the depositor must receive a written confirmation with a seal that an account has been opened with it. This document is transferred to a Russian bank.

It remains to add that such a mechanism for transferring funds assumes that a Russian bank tracks all transfers of funds to an account in a foreign financial institution.

Reporting to the tax office. What awaits the owner of a foreign account?

As mentioned earlier, opening an account with a foreign bank requires a Russian citizen to notify tax service, which is carried out no later than one month after the opening of the account. Only on the basis of a notification from the Federal Tax Service, in the future, it is possible to make transfers of funds to foreign banks.

When using an account with a foreign bank to an individual it will also be required once a year (before June 1) to submit to the tax authorities reports of the established form regarding the movement and balances of funds in foreign accounts (Resolution No. 1365 of December 12, 2015).

It is important to follow these rules:

• Reflect the sum of inflows, outflows and account balances.
• Prepare a separate report for each foreign account.
• Send the document to the Federal Tax Service through the online office of the taxpayer or by registered mail.

When submitting reports to the tax service, there is no need to attach statements of accounts in foreign banks to it.

Opening an account in a foreign bank is a convenient opportunity to protect your funds from inflation and other domestic risks. This practice seems to be very convenient for individuals who often leave the country. However, the outwardly simple procedure for opening an account requires transactions through the accounts of domestic financial institutions, as well as mandatory notification of the tax authorities.

After the change Russian laws it became possible for citizens to open deposits in banks of other states. An entrepreneur will need a business account in a foreign bank if he is going to do business with foreign partners. In addition, foreign banks often offer deposit interest that is significantly different from what Russian banks provide. financial institutions. Therefore, Russians are more willing to trust them with their savings. Anyone can open a deposit, but this procedure is not so simple. Let's figure out what nuances distinguish opening accounts in foreign banks, what is necessary for this and how reliable this method of depositing funds is.

Legislative standards

Russian citizens do not need permission today Central Bank in order to have accounts abroad. The law on the regulation of foreign exchange transactions allows residents of the Russian Federation to open foreign currency deposits. The only condition for this is notification of the tax authority. The period during which the citizen is obliged to provide information is also determined. It is one month. Violation of this rule will entail a fine of 5 thousand rubles.

As part of the fight against corruption, a circle of persons was determined who are prohibited from having foreign accounts. These include high-ranking officials, the Prosecutor General and his deputy, as well as members of the board of directors of the Central Bank of the Russian Federation. Violation of the norms is considered by a specially convened commission, which decides on punishment for a civil servant who has violated the law.

How to open an account in a foreign bank in Russia

Most citizens of the Russian Federation mistakenly believe that we have representative offices of banks in other countries. Confusion about whether it is possible to open an account with a foreign bank in Russia is created by a large number of foreign subsidiaries. However, in reality, international financial organizations do not operate on the territory of our country. Although the subsidiaries of foreign banks are based on foreign capital, they, like domestic ones, are subordinate to the Central Bank, that is, they work in accordance with Russian legislation. Therefore, deposits in them are not insured against risks.

Foreign banks approach the choice of clients quite strictly, so it is often difficult to open an account on your own. You need to have sufficient knowledge of English to negotiate with foreign managers. In addition, it is required to collect a package of documents, which is individual for each bank. Therefore, it is most reasonable to turn to the services of intermediary firms that provide assistance in resolving such issues. Experts will tell you how to open an account in a foreign bank for a Russian citizen, they will help you choose more profitable terms. However, you need to be careful, there are many scammers in this area who only need a deposit number and a sample signature of its owner.

Account for doing business abroad

An entrepreneur who wants to conduct business abroad or organize international e-commerce must have an account opened with a bank located in an offshore jurisdiction. These financial institutions provide a well-functioning service that allows you to perform various financial transactions.

A businessman must be prepared for the fact that the bank will be interested in the purpose of opening an account, the type of activity that the company conducts, as well as its financial turnover. Attention will also be paid to business partners, if any. The minimum set of documentation consists of:

• statements;
• copies of personal documents;
• recommendations from other banks;
• package of founding documents.

It should be noted that many financial institutions refuse to work with little-known companies or Forex market players.

Account opening methods

A citizen has the right to use a currency account in a bank of a foreign state only for personal purposes, that is, to save and accumulate finances or make investments. It is unacceptable to use it for business purposes. Duration of registration from 7 days to six months. To open an account, you need to personally visit the country in which the selected bank is located. After providing the necessary papers and filling out the forms, it remains to wait for a negative or positive decision.

For those who are interested in how to open an account in a foreign bank for an individual without leaving Russia, the second option is suitable - contacting intermediaries. The services of such firms will cost from 200 to 12 thousand dollars. The depositor will only need to certify with the consul or in the subsidiary branch of the selected bank a sample of his personal signature. It is possible that the depositor will have to communicate with the manager via the telephone network before opening an account or personally meet him in the Russian capital.

Banks have different requirements for the list of required documents. The minimum set, as a rule, includes certificates:

• about the income of an individual;
• about the absence of a criminal record;
• about the composition of the family.

This is accompanied by copies of the passports of the depositor and his wife signed by a notary, as well as receipts confirming the absence of debt on housing and communal services.

Managers of subsidiary Western banks will be able to contribute to the opening of a foreign account. The connections between them will noticeably speed up the process. Free help can be obtained using the segment private banking. A similar financial service is provided, for example, by Promsvyazbank, Sberbank or Russian Standard.

Foreign Account Management

You can replenish the deposit both in cash and by bank transfer through Russian banks. When personally depositing currency into foreign accounts, you will need to confirm the legality of its acquisition. To make a transfer, Russian financial organizations require a notice of opening an account in a foreign bank by an individual with a mark on tax registration.

Management of foreign deposits is carried out in several ways. Here is their list:

• through bank cards;
• using checkbooks;
• through courier mail;
• connecting online banking;
• facsimile.

The security system protects the depositor's funds through specially designed codes and ciphers, dedicated communication channels.

Instructions for opening an account abroad

The first step should be to choose a country. Many Russians who open a deposit want to deal with Western European banks. Unfortunately, the financial institutions of these countries are not interested in servicing non-residents. Baltic banks would be a more suitable option. Swiss credit organizations suitable for saving and increasing capital. But the number of transactions with such accounts is limited, in addition, the balance of the deposit must be quite large. In Southeast Asia, it is more profitable to open an account for business; ordinary deposits are reluctantly accepted here.

After you decide on the country, you need to choose the right bank. Factors such as:

• reliability rating;
• the size of the minimum deposit;
• ease of account management.

The next step is to submit an application and the necessary documents. Some banks insist on the personal presence of a potential depositor. When making a decision, it will not be superfluous to inquire about the deposit insurance system. In all countries, the schemes of work of such companies are similar, but the amount of payments sometimes varies significantly.

The next step is to decide on the type of account. If this is a current deposit that involves constant replenishment or withdrawal, the interest on it will be low. Those wishing to increase their savings need to rely on the fact that it will be impossible to withdraw funds until the end of the contract. For those who want to participate in exchange trading, sale and purchase of shares of Western companies, an investment account is suitable.

Pros and cons

Foreign banks pay great attention to security and the secrecy of the deposit is not an empty phrase for them. That is why many reputable businessmen prefer to keep their savings outside of Russia. In addition, such preservation of funds gives their owner a certain status. The big advantage of opening an account in a European bank is not only reliability and security, but also the possibility of obtaining citizenship of the country where the savings are stored.

The disadvantages include the need to pay for intermediary services when opening a deposit from Russia. An additional obstacle is the need to collect additional information. In addition, when entrusting money to a foreign bank, a Russian is obliged to notify the state authorities about this.

In recent years, a new trend has emerged: foreign banks are choosing non-resident clients with caution, and the “crackdown” due to the requirements of financial institutions of various levels has affected both individuals and legal entities. Nevertheless, the issue of keeping money abroad is still relevant for Russians and citizens of the CIS.

Why trust money to foreign banks?

For citizens of the Russian Federation, having an account in a bank in another country is an important condition for employment abroad, obtaining a residence permit, and buying real estate. Keeping funds abroad, investing in local companies help to preserve and increase capital. In addition, opening a multi-currency account will save money during purchases and payment for services abroad.

For business, a corporate foreign account is:

• insurance against financial shocks (changes in currency control, inflation, devaluation);
• maintaining confidentiality;
• positive impact on business reputation;
• opportunity to attract new partners to cooperation;
• possibility to use international credit offers.

Note! Finances abroad are limited in functionality: residents of the Russian Federation are allowed to transfer only certain categories of income to foreign accounts. For example, since 2018, restrictions have been lifted on income received from the sale of foreign real estate, shares, as well as non-cash transfers from domestic banks.

When opening, the type of account is indicated:

• Settlement: allows you to conduct frequent operations (accrual or write-off financial resources). This is important if you plan to trade or provide services to foreign partners. The Bank has the right to set a limit on the minimum non-spending amount, which must remain regardless of the volume of transactions.
• Savings (accumulative): help increase savings, so it is very problematic to use them for current calculations.

What do individuals need to know about opening a foreign account?

The first thing that citizens of the Russian Federation will face is the choice of a country suitable for this purpose. Not all states are ready to provide financial services to non-residents without a residence permit or real estate. For example, financial institutions in Singapore and Scandinavian countries require additional documents explaining the origin of savings, while the Latvian Rietumu Banka, on the contrary, is ready to cooperate with foreigners through a remote service.

Banks have a limit on the minimum deposit size: Barclays and UBS are asked to deposit at least €50,000 to open, and Chinese Bank of China or ICBC need ¥20 (about 200 rubles). In addition, almost all foreign financial institutions do not allow non-residents to open accounts for doing business.

When choosing a bank, consider:

• the size of the rate and interest;
• guarantees of the safety of the deposit (including by local authorities);
• the size of the non-expendable balance on the deposit;
• terms of deposit insurance;
• the need for a personal meeting with the manager.

In some institutions (Deutche Bank, Credit Suisse, BPI) you cannot use the services of an intermediary - the manager will definitely want to talk in person. Be prepared to be asked to show documents on the origin of money, references from other financial institutions or partners.

How to choose a bank for a corporate account?

Even if it is not an offshore company, choosing the right institution becomes a daunting task. Here are just a few points that you should pay attention to when analyzing offers in the banking services market:

• does the bank work with companies from the Russian Federation;
• is it possible to open current accounts;
• whether the service is available for the company with the specified type of activity, the list of beneficiaries, partners, as well as with specific directions of transfers and payments;
• types of currencies for transactions;
• bank rating, its reputation on financial market, indicators of recent years, development prospects.

If it is not possible to conduct a complete analysis on your own, you should seek the help of specialists. They have all the relevant information, so they will be able to assess the risks for each specific company.

If we talk about countries, then for legal entities it is recommended:

• European banks (Baltic countries, Central and Western Europe, Cyprus, Montenegro): enjoy the well-deserved trust of foreign companies, often ready to provide support in Russian. Of the minuses - the increased terms for consideration of documents, the request for additional information (up to tax reports for several years), the high cost of service, the impossibility of opening an offshore.
• Asian financial institutions (Singapore, Hong Kong): give preference to companies doing business in eastern region, be sure to conduct an independent expert assessment of the investor's assets. It is very difficult for a company from Russia to gain a foothold in Hong Kong: in addition to a face-to-face conversation (by no means in Russian), from legal entity will require you to open a representative office in Hong Kong (as well as regularly pay local taxes). Another disadvantage is that there are no Russian-speaking specialists from the support service, there is a big time difference.
• Offshore banks: severely restrict settlements with certain countries, national currencies. Not recommended if you need to make USD payments, as well as for settlements with companies from the USA, the European Union.

As a rule, the foreign banking sector refuses startups (they cannot indicate partners, confirm relevant experience), high-risk businesses (cryptocurrencies, blockchain, precious metals). Companies working in the field of trade, logistics, finance, IT projects have a high chance of approval.

Algorithm for opening an account abroad

The procedure for the main actions is the same for any banking institution abroad.

2. Filling in the required forms. Providing additional information (documented) to the manager. Each bank has the right to make its own list of requirements, including:

• statutory documents (for legal entities);
• confirmation of the type of commercial activity;
• information about counterparties, the content and direction of future payments;
• information about the owners of the company (individuals);
• volumes of funds movement (annual turnover, frequency of operations, amount of unspent balance).

3. Waiting for a decision on the submitted application (from 7 to 60 days).

For individuals, the list of documents contains:

• a document proving the identity and place of residence;
• certificates of income, an employment contract confirming the availability of a source of finance;
• Bank statements;
• receipts for payment of tax, utility payments;
• certificate of no criminal record;
• information about the composition of the family.

In case of a positive decision, the non-resident receives information about the account number, free access to Internet banking, and, if necessary, a plastic card.

Collection of information by the bank

Compliance - internal banking procedures that allow you to assess the integrity and reliability of the client from all sides. Submitted documents are checked, as well as information from other sources.

To collect information, the bank adheres to the principles of "due diligence" (due diligence) and "know your customer" (know-your-customer). Such a check is a consequence of the decisions of national regulators (and in the case of the EU countries - international ones) to combat the financing of terrorism, the laundering of "dishonest" income.

Russians who decide to keep money abroad, it is better to take care of documenting their business activities, sources of wealth, tax or utility payments in advance.

CRS (Common Reporting Standard): what you need to know about the international exchange of information

Since the fall of 2018, Russia has been fully participating in the international program for the exchange of information about bank accounts according to the CRS standard. From now on, all foreign banking companies send the Federal Tax Service of the Russian Federation information on private and commercial accounts abroad, owned by Russian citizens.

To be exchanged:

• passport data, TIN;
• numbers of settlement, savings accounts;
• information on the state of the account at the end of the reporting period (closing), types of assets.

To date, the Agreement has been activated by about 60 countries, including the European Union and the Asian region.

Financial reporting abroad

If a citizen of the Russian Federation has been living in the country for more than six months, he is considered currency resident. Therefore, any account opened abroad must be declared in accordance with applicable law. The citizen is obliged:

• inform the Federal Tax Service about opening or closing a foreign account, changing its details;
• by April 30 of each year, send a report on the movement of funds for the past period;
• respect the restrictions on foreign exchange transactions provided by federal law N 173-FZ.

Instead of a conclusion

For CIS citizens, foreign banks are still one of the profitable options saving and increasing funds. However, finding the right financial institution not easy: every year the requirements for non-residents become tougher.

In order not to waste time and money, we recommend that you contact accredited intermediaries. They will help you make a choice taking into account the purposes (for private or corporate use, investments or settlements), the type of currency, the characteristics of commercial activity, the region. In order to minimize the risks, when making a decision, be sure to take into account financial policy states, as well as geopolitical factors.

Many citizens of our country believe that it is better to keep money in foreign banks. Russian economy is constantly in a state of crisis, sanctions are being introduced and lifted, oil is falling, the dollar and the euro are growing. All these factors do not contribute to an increase in confidence in domestic banks, because people do not leave the feeling that at any moment everything can collapse. At the same time, it is necessary to understand that opening an account abroad is accompanied by certain difficulties. Is this even possible? In this article, we will tell you how to open an account with a foreign bank, what difficulties may arise, and we will also help you choose the most reliable country for your account.

Who among Russians can open an account abroad?

In Russia, Federal Law No. 79 of May 7, 2013 was adopted, limiting the circle of persons entitled to open accounts in foreign banks. So, it is prohibited for those who hold senior positions in government agencies, such as:

• the Prosecutor General's Office;
• federal executive authorities;
• board of directors of the Central Bank of the Russian Federation and others.

Until recently, to register an account in a foreign country, it was necessary to obtain permission from the Central Bank of the Russian Federation, but now the procedure has been simplified. It is sufficient to notify the tax service within 30 days after signing the agreement with the bank. After that, every 5 years you need to submit a report on the movement of funds to the tax service.

Also in 2016, Russia became a party to an international agreement on the exchange of data on financial transactions. Starting from 2018, our country will be included in a single information field with other states, which will allow tax authorities directly receive information about the movements of funds of Russians. Therefore, you need to be prepared that it will become more difficult to hide your income.

The main question: how to choose a country for opening an account

In order to open an account in another country, as a rule, you need to be a resident of that country. Some banks do not have such a requirement for customers. But then, perhaps, you will encounter other terms of service.

Often, financial organizations require you to provide documentary justification for your desire and ability to open an account in another country. The bank may require you to provide:

• resident card;
• property ownership documents;
• visa (if required to enter the country);
• a certificate of 2-NDFL certified by a notary, a certificate of the right to inheritance and other documents confirming the receipt of finances.

Each bank has its own rules for accepting applications for opening an account for citizens of other countries. Therefore, it is necessary to clarify the list of requirements on an individual basis. But it is worth noting the general trends:

1. In the Eurozone countries, as a rule, documents from the list above will be requested (in Sweden, Great Britain, Spain and others). The exception is the Latvian bank Rietumu Banka, which even assists foreigners in obtaining a residence permit and is ready to open an account with a small investment.
2. Also, in large world banks, a threshold is set for the minimum amount for storage. Most often, this is 50,000 or even 100,000 in the state currency, and, for example, for Credit Suisse, Barclays or UBS without a residence permit, 1,000,000 or more will be accepted.
3. At the same time, many Asian countries are interested in investments and provide comfortable conditions for opening accounts. For example, Chinese ICBC and Bank of China are ready to approve an application upon receipt of an account of 1,000 yuan. But Singapore, unlike the example, is demanding when it comes to opening accounts by citizens of other countries, and the authorities will require a full package of documents.

Of course, only the most basic points regarding cooperation with foreign banks are listed here.

How to open a bank account abroad?

The main limitation for individuals when opening an account in another country is that the account can only be used for personal purposes. It is prohibited to carry out any operations related to entrepreneurial activity. You can use an open account only in three ways:

• storage of funds;
• payment for purchases, services and other personal expenses;
• investment activities.

As for the registration of the application, in different countries it will take from a week to several months. Documents are carefully checked, and the bank's security service must make sure that you are trustworthy and honest. And only if the bank makes sure that there are no reasons for refusal, they will open an account for you.

As a rule, much attention will be paid to the legitimacy of the origin of the investment funds. In addition, in case of a positive decision and approval of the application, in the further use of money from the account (especially when working with large amounts), you may also be required to justify the expenses. For example, request documents for the purchase of real estate or checks from a medical institution.

Most often, you will need to personally fill out an application to open an account, so consider the possibility of visiting the country that provides you with banking services. Additionally, it is worth checking with the manager of the selected bank some important details:

• guarantees of saving money on the account for foreigners (especially for those who are not residents of the country of the bank);
• the size of the minimum balance on the account (there is also no one universal value for all institutions);
• how much does it cost and what does deposit insurance give.

Account opening methods

There are several possibilities to open your own account abroad. This can be done in the following ways:

1. Personally draw up all documents in the language of the country accepting the application. Further, most likely you will be required to come to the bank and fill out a questionnaire on the spot.
2. By concluding an agreement with an intermediary company that will prepare and send all the necessary papers for a fee. This service can cost up to several thousand dollars.
3. By issuing a power of attorney to a third party (for example, to a colleague or lawyer who is permanently in the country of the bank).

Large banks are not always ready to work with a future client blindly, through third-party organizations or proxies.

It is necessary to clarify the rules of work of a particular organization, which may include either a mandatory personal visit to the office, or a conversation with an employee of the company by phone, or a visit to a representative office in our country (usually in Moscow), such as Deutsche Bank, Credit Suisse.

UK and US banks

The most serious requirements for clients are made in English and American banks. It is especially difficult for non-residents to open an account, but there are strict rules for those who already have rights in the state, confirmed by a residence permit. You may be required to provide:

• letters of recommendation from colleagues or business partners;
• real estate lease agreement on the letterhead of a British real estate agency;
• paid rent and utility bills (address and name must be included) and other documentation.

Therefore, if you are not a resident of these states, then think carefully about the profitability of opening an account. You will face a number of difficulties and it is far from certain that you will be able to break through all the bureaucratic barriers.

Account Management and End of Service

AT modern world the online banking system is well developed, so account management will not cause problems.

Replenishment of the account, in addition to the traditional cash deposit through the cashier, is also possible online. But there are some nuances:

• you can transfer money from a Russian account to a foreign one only after notifying the Federal Tax Service;
• when depositing funds in a bank, it is necessary to explain the origin of the money and confirm its legality.

Before opening an account with the institution of your choice, check how it can be closed later. As a rule, you will need to make a personal visit to the branch where you applied and filled out the questionnaire.

The minimum package of documents for opening an account in a foreign bank

Most Required documents the ones you need look like this:

• a notarized copy of your passport, as well as your spouse's passport, if any;
• birth certificates of children and other documents confirming the composition of your family;
• justification of the reasons for opening an account (residence permit, real estate in the country of the bank, etc.);
• income statements for the last 6-12 months, certified by the Federal Tax Service;
• certificate of no criminal record.

If there is a branch of a bank in Russia where you plan to open an account abroad, then contact the company's office for advice.

Summing up, we can conclude that in order to open an account in a foreign bank, you need:

• carefully collect all information about the requirements of the financial institution in advance;
• clarify the nuances of servicing, closing an account and providing guarantees for citizens of other countries;
• scrupulously prepare the requested documents and carefully communicate with employees;
• be prepared to come personally to the country opening the account, or spend some money to pay for the services of an intermediary company in opening an account.

The main thing is to be patient and not wait for an instant result, and with a responsible approach, you will be able to open an account in a foreign bank.