Acquire crypto license in Latvia and provide cryptocurrency services in all EU. Latvia has best corporate tax regime in all EU for crypto companies.

Crypto-Licensing in Latvia: Gateway to the EU Market

Latvia has emerged as one of the most attractive jurisdictions for cryptocurrency service providers, offering a favorable tax regime, a transparent regulatory framework, and access to the entire European Union market. Companies can benefit from a 0% Corporate Income Tax (CIT) on retained earnings, with a 25% tax applied only on distributed dividends. This advantage makes Latvia a prime destination for businesses seeking to expand their operations across Europe.

Since January 2025, you can acquire crypto license in Latvia and provides crypto related services in all EU subject to EU passporting regulations – a simplified procedure which allows freedom of crypto services under one license in the EU. 

Key Advantages of Obtaining a Crypto License in Latvia

  1. Access to the EU Market: Obtaining a Latvian crypto-asset service provider license allows businesses to offer their services in all EU member states under the principle of "passporting." This regulatory advantage provides seamless expansion opportunities without the need for additional licenses in other jurisdictions.
  2. Tax Benefits: Latvia offers one of the most competitive tax environments for cryptocurrency businesses. With a 0% CIT on reinvested profits and a 25% rate only on distributed dividends, companies can effectively allocate resources to growth and expansion without excessive tax burdens.
  3. Transparent Regulatory Framework: The regulatory environment in Latvia is designed to foster innovation while ensuring compliance with the highest standards of Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT) measures.

Categories of Crypto Licenses in Latvia

The EU regulatory framework categorizes crypto-asset service providers into three main classes based on the scope of services offered and minimum capital requirements:

Type of Crypto-Asset Services

Minimum Capital Requirements

Class 1

EUR 50 000

Execution of orders on behalf of clients; Placing of crypto-assets; Providing transfer services for crypto-assets on behalf of clients; Reception and transmission of orders for crypto-assets; Providing advice on crypto-assets; Providing portfolio management on crypto-assets.

  

Class 2

EUR 125 000

Services under Class 1 plus: Providing custody and administration of crypto-assets on behalf of clients; Exchange of crypto-assets for funds; Exchange of crypto-assets for other crypto-assets.

  

Class 3

EUR 150 000

Services under Class 2 plus: Operation of a trading platform for crypto-assets.

  

 

Bank Fees and Review Timelines

Costs:

  • EUR 2 500 for reviewing the documents and information submitted to obtain authorization

Review Deadline for the Application:

·      25 working days for a completeness check of an application

·      Within 40 working days following the confirmation that the application is complete, Latvijas Banka reviews the application and takes a decision to issue or refuse to issue authorization. The review deadline for the application may be extended for objective reasons if the information provided in the application is insufficient to take a decision.

Regulatory Requirements and Compliance

The primary law governing crypto-asset service providers in Latvia is Regulation (EU) No. 2023/1114, which will take effect on December 30, 2024. This regulation establishes the licensing criteria and compliance requirements that businesses must meet to operate legally.

Key compliance obligations include:

  • Establishing robust AML and CFT policies.
  • Implementing effective Know Your Customer (KYC) procedures.
  • Ensuring transparent reporting and audit trails.
  • Maintaining a secure and resilient technological infrastructure.

How EU LAW FIRM Can Assist You

Navigating the licensing process can be complex, but EU LAW FIRM offers comprehensive assistance to ensure a smooth and efficient application process. Our team of experienced legal professionals provides:

  • Initial Consultation: Assessment of your business model and determination of the appropriate license category.
  • Document Preparation: Assistance with drafting business plans, AML policies, and other required documentation.
  • Regulatory Liaison: Acting as an intermediary with the Bank of Latvia to facilitate the licensing process.
  • Ongoing Compliance Support: Ensuring your business remains compliant with evolving regulatory requirements.

Steps to Obtain a Crypto License in Latvia

  1. Preparation Phase:
    • Define business objectives and select the appropriate license category.
    • Develop the required documentation, including compliance policies and operational procedures.
  2. Application Submission:
    • Submit the application to the Bank of Latvia, along with all supporting documents.
  3. Regulatory Review:
    • The Bank of Latvia reviews the application within a minimum of 40 working days.
    • Additional documents or clarifications may be requested during the review process.
  4. License Approval:
    • Upon successful review, the crypto service provider license is granted, allowing operations to commence.

Conclusion

Latvia's crypto-asset service provider licensing framework offers unparalleled advantages for businesses looking to enter the European market. With a favorable tax regime, regulatory transparency, and access to all EU countries, Latvia presents an ideal location for crypto entrepreneurs. 

EU LAW FIRM stands ready to guide you through every step of the licensing process, ensuring full compliance and operational success.

For more information or to start your licensing journey, contact us today at:

Email: info@eulawfirm.eu
Phone: +371 26742086