Investment firm licence (Latvia)

At a glance

What it lets you do

• Reception and transmission of orders
• Execution of orders on behalf of clients
• Dealing on own account
• Portfolio management
• Investment advice
• Underwriting or placing on a firm commitment basis
• Placing without a firm commitment
• Operating a multilateral trading facility (MTF)
• Operating an organised trading facility (OTF)
• Safekeeping and administration of financial instruments
• CFD and forex brokerage

• Reception and transmission of orders. Receiving client orders in financial instruments and passing them to another firm for execution.
• Execution of orders on behalf of clients. Concluding agreements to buy or sell financial instruments on behalf of clients.
• Dealing on own account. Trading financial instruments against proprietary capital, which includes acting as counterparty to client trades.
• Portfolio management. Managing client portfolios that include financial instruments on a discretionary, client-by-client basis.
• Investment advice. Giving personal recommendations to a client about one or more transactions in financial instruments.
• Underwriting or placing on a firm commitment basis. Guaranteeing the sale of an issue of financial instruments by committing to buy what is not sold to investors.
• Placing without a firm commitment. Placing financial instruments with investors on a best-efforts basis, without guaranteeing the sale.
• Operating a multilateral trading facility (MTF). Running a multilateral system, other than a regulated market, that matches third-party interests in financial instruments under non-discretionary rules.
• Operating an organised trading facility (OTF). Running a multilateral system for non-equity instruments where the operator exercises discretion over order execution.
• Safekeeping and administration of financial instruments. Holding financial instruments for clients and related services such as cash and collateral management, as an ancillary service.
• CFD and forex brokerage. Offering retail and professional clients contracts for difference and rolling spot forex, usually as dealing on own account or order execution.

Where it is valid

Buying a company that already holds it

Prior approval required. Acquiring or increasing a qualifying holding reaching or crossing 10%, 20%, 33%, or 50% of capital or voting rights, or causing the entity to become a subsidiary, requires prior notification and approval from Latvijas Banka. Under Latvijas Banka Regulation No. 241 and the Credit Institution Law, the assessment period is 60 working days from receipt of a complete notification, interruptible once by up to 20 or 30 working days to request supplementary documents; Latvijas Banka evaluates reputation, financial soundness, and AML/CFT compliance before issuing approval.⁵

Laws behind it

• Directive 2014/65/EU on markets in financial instruments: Directive 2014/65/EU
• Capital Requirements Directive: Directive 2013/36/EU
• Capital Requirements Regulation: Regulation (EU) No 575/2013