The Dominican Republic is one of the main tourist hubs in the Caribbean. Its coasts are home to beaches, resorts, luxurious hotels, golf courses and casinos.
Some special economic activities in DR need a special license to operate. For example, in order to open a casino you need a gambling license or if you want to operate in investment funds you would need an investment funds license. These licenses are granted by the Dominican government.
You must be careful, because if you operate without these licenses you can get in trouble with Dominican authorities. In this article we will explain all you need to know for some of the financial licenses available in the Dominican Republic.
In order to engage with the banking business in the Dominican Republic, you will need to comply with some requirements regulated by the Superintendency of Banks.
Any individual interested in create a bank in the Dominican Republic must submit an application to the Superintendency, along with the following requirements:
-Constitutive Act, detailing personal information of the
shareholders or partners that are creating the financial entity: Names, Nationality, Address.
-A business plan
-Copy of the ID or passport of the applicant
-Two commercial references of the applicant.
-Two banking references of the applicant.
-Curriculum Vitae of all the shareholders that have at least a 3% share capital.
After the approval of the prerequisites, the applicant must submit the formal application along with the following documents:
-Business name and address.
-A feasibility study of the project
-A proof of payment of the foundation fee made to the Central Bank.
It's worth noting the extremely high requirements for the reliability and reputation of investors. The investor's company will undergo a multi-stage check. Recommendations from VIP clients of banks within the country, and guarantees from owners of well-established businesses within the country or abroad will be required. This will require tens of thousands of dollars in legal costs.
The Investment Funds License
The Dominican Republic is the main destination for foreign investment in the Caribbean. Tourism, telecommunications and real estate are some of the profitable areas in recent years.
If you wish to operate an Investment Fund in the Dominican Republic, you will need to have an Investment Funds License issued by the Dominican Republic government. Below we will give you a brief explanation on how to obtain it.
The office that rules this license is the “Superintendencia del Mercado de Valores de la República Dominicana”. This office receives applications for both companies and individuals that wish to promote and administer investment funds in DR.
Any legal person that wishes to enroll in the Registry in order to operate as a investment fund management partnership (“sociedad administradora” in Spanish) must provide the following requirements to Dominican authorities :
-Name, corporate purpose, address, number on the Mercantil Registry, phone numbers, website and email.
-An approved share capital.
-Composition of the board of directors, detailing name, id number or passport, occupation, nationality and address.
-A document that details the operation and services the company intends to provide.
-Any other information that the Superintendence requires.
1. Complete the application form, which is available on the superintendence web page.
2. Consign the form to the Superintendence along with annexed documents and a proof of payment for submitting the documents.
3. If the application is approved by the Superintendence, the applicant must pay the registration fee, which is 1% of the company’s patrimony.
The process of application takes about 25 business days to complete. All the documents submitted must be apostilled and translated to Spanish.
This license applies for any individual that wishes to act as an Investment Funds promoter in the Registry, in order to operate in the Dominican stock market. He or she must submit the following requirements to get the license:
-Admission application to the investment funds promoter exam.
-Proof of payment of the fees regarding submission of the documents and the test’s application.
-A bachelor's certification of a national or foreign university, or a 2-years certification on laboral experience on business emitted by a financial firm.
-Copy of the ID, or passport along with the residency card if the applicant is a foreigner.
-A notarized affidavit that states that the applicant is not unfit to promote or operate, according to Dominican law.
-The applicant must submit the application to the Superintendence and the required documents, at least 10 business days before the accreditation test.
-After that, the applicant must approve a test that certifies his technical abilities to promote investment funds.
The whole process takes up to 25 business days to complete. The applicant must pay 5,000 DOP in fees (about 90 USD) regarding submission of the documents and taking the test.
The Gambling License
Thanks to its thriving tourism industry and a favorable tax environment, the Dominican Republic has become the main hub of gambling in the region, to the point some people call it the Las Vegas of the Caribbean.
In casinos that would make you feel in Macau, tourists and natives enjoy a wide variety of gambling games, such as poker, blackjack, roulette. The main thing that a casino operator would need to offer those services is a gambling license, which is granted by the Dominican government.
A licensed gambling company may qualify to be tax-exempt in DR, this environment has made many online gambling sites and operators to have Dominican Republic as their main hub of operation. Many investors have created extraordinary casinos that include luxurious hotels and resorts.
In order to obtain a gambling license in DR, the first thing you need to do is to create a company in the Dominican Republic and submit the application to the “Dirección de Casinos y Juegos de Azar”.
After that, you will need to complete the identification of the Ultimate Beneficial Owner (UBO) along with a detailed list of the games to be offered. The hardware and servers must be based on DR in order to comply with the Permanent Establishment Requirement. However, in the country there are many providers that could host the servers. After getting the gambling license, you will need to open a corporate bank account.
In a nutshell:
-Corporate income tax for gambling licensed companies is 0%.
-Getting a gambling license in DR can take 6 months or more to complete.
-The cost of a license to open a casino at a hotel depends on the number of gaming tables and the type of game and can vary from $ 20,000 to $ 50,000 per table.
Also, you should know that the country is pursuing a policy of reducing the small gambling business, casinos and slot machines. The reason is because the Dominicans are very gambling people.
At the same time, the opening of casinos at large hotels (4-5 stars, from 40-50 rooms) is encouraged as a way to entertain tourists and an indirect way to increase the profitability of hotels. These casinos are not taxed at all.
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