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How Long Does It Take to Obtain An MSB License In Canada

Michael K. Gauthier | Updated On February 9, 2024

According to Statista, Canada had an annual immigration of 300,000 immigrants, and around 8 million immigrants with permanent residence in the year 2020.

If the firm plans to engage in monetary activities, then people should go through the process of obtaining MSB license in Canada by fulfilling all the demands of the Regulator and following state legislation. The most vital aspect is compliance with the AML policy you must implement in your acts.

So, here in this read, we’ll delve into the financial regulations, demand, and the whole process of receiving a license in Canada. 

Let’s dive right in!

Financial Regulation

Business registration is handled by regulatory authorities, a particular intelligence unit of this country, and the leading partner of the Ministry of Finance. In addition, regulatory authorities monitor all transactions reported by firms and are responsible for the timely detection of illegal acts. 

Control of monetary crime is carried out based on the law, which provides for the appropriate preparation of reports and the maintenance of systematic records of transactions. This law has developed specific regulations, standards, and methods of control and punishment if financial firms do not observe these rules.

It is indispensable to understand that Canadian legislation is one of the strictest in the world. Therefore, if violations are discovered in the activities of a firm, it can not only be fined and sanctions imposed but also brought to criminal liability. It is vital to comply with AML commands and have responsible persons on staff who control the conduct of transactions.

Demands

To receive a paper, people need to fulfill the following:

• register a real office within the borders of this country;

• implement and follow the command of the AML and KYC policy, taking into account all risks, conducting strict identification of clients, and appointing responsible managers;

• the management team (founders, directors) must present certificates of no criminal record from the country of which they are citizens;

• constantly monitor completed transactions and, if suspicious actions are detected, report to the competent authorities;

• at least one manager must have an economics degree.

We have listed the most basic demands for licensing. Therefore, before applying, you should carefully study the entire list of conditions so that everything runs smoothly when registering a business and receiving a license.

Did You Know?

The Federal Skilled Workers Program in Canada follows a Point-based system to test the applicant’s proficiency in English or French language, where they require a minimum of 67 points out of 100. 

The Process of Receiving a License and the Timing of Each Stage

To get a document, you must go through several stages, each of which you would fulfill all the conditions.

Prepare a Package of Papers (2 weeks)

You must collect all the data, including the detailed project budget and the planned profit. It would help if you described precisely what activities the plans to engage in. 

A key aspect will be a document stipulating that the company will adopt an AML and KYC program.

Register a Business (1-1.5 months)

The firm name is selected, and a legal address is assigned. To do this, you need to rent an office and provide the Regulator with a lease agreement. The authorized capital is determined, and a package of corporate documents, which must be notarized, is delivered.

Open a Bank Account (1-1.5 months)

A bank representative will give you a list of documents to open a corporate account. A notary certifies all papers, negotiations are held between both parties, and the authorized capital is deposited into the account. Finally, the report is opened, and the firm complies with local tax obligations.

Apply and Register (2 weeks)

Along with the application, a package is submitted for licensing, taking into account compliance with the rules on combating ML. Specialists are employed, and if necessary, they are trained and adapted. 

You may also require additional documents, negotiations are held, and the company’s compliance with existing demands is approved. If all documents are in order, the application for a license is considered.

Obtaining Permission for Financial Activities (1 month)

The prepared package of papers submitted to regulatory authorities will be carefully reviewed, and the support of a company representative will be required throughout the process. 

Upon completion of the registration and licensing stages, the firm receives permission – a document and is entered into a special register of perfect organizations.

Thus, registering a business and financial activities in this area can take 4–5 months. This period is associated with stringent legislation and strict controls related to the fight against ML and economic terrorism.

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