Opening of bank accounts for non-resident companies in banks of the Republic of Armenia

The service of opening bank accounts for companies registered outside Armenia has recently become very popular. This can be explained by several factors, in particular, by the fact that the currency legislation of the Republic of Armenia provides ample opportunities to transfer funds outside the country and by the fact that Armenian banks are quite flexible in providing banking services. Widespread are services of remote service of accounts (bank-client, Internet-banking, mobile-banking), which will give an opportunity to manage accounts from different parts of the world, to provide business cards, to open foreign currency accounts, escrow accounts, opening gold accounts, providing brokerage services, etc.

At the moment many Armenian banks open bank accounts for foreign companies in Armenia allowing the latter to conduct convenient tax and currency planning. It should be noted that opening of bank accounts for non-residents in Armenia is carried out in a slightly complicated order and banks will pay more attention to various details in providing services to their potential foreign clients than in opening accounts for residents. This is conditioned by the Armenian legislation against money laundering and terrorism financing.

Thus, when opening accounts for a foreign organization, it is necessary to provide all the information about its activity and real beneficiaries to the bank. It should be noted that providing false information may lead to adverse legal consequences.  Prospective client must be ready to provide information on the company’s activities, a description and purpose of the account at the request of the bank. A wide variety of information can be requested, ranging from the nature of the work or services provided by the company to contracts already entered into.

The Bank will conduct thorough check with the purpose of protection from additional risks and compliance with the legal acts of the Central Bank of the Republic of Armenia. That is why it is in the interest of the company, when approaching the bank, to have prior agreements with local organizations for providing services, fixed in the form of contracts, as well as to have a ready package of constituent documents of the company. The process of opening accounts will also be facilitated by the company’s own functioning website.

If bank accounts will be opened solely for the purpose of conducting transactions under obligations to which only foreign organizations will be parties, it will greatly reduce the bank’s interest in opening an account for a non-resident organization. Banks are primarily interested in the fact that their potential customers have a real intention to bring money to the bank and keep it there. Therefore, the prospect of opening an account for a company, knowingly intending to use the account as a transit point for funds turnover, may be a reason to refuse to provide services.

To open an account first you need to provide the founding documents of the company, such as the Charter, certificate of state registration of a legal entity or an extract from the commercial register of a foreign country, documents confirming the authority of the director, notarized copies of the founders’ passports, a copy of the passport of the director. In some cases, the constituent agreements of foreign companies may be required, certificates (certificates) indicating the shareholder’s rights in respect of the share capital of the company (depending on the legal form of the legal entity). 

Bank accounts are most readily opened if the director (CEO) of a foreign company comes to the bank in person to open an account. Some banks deliberately set difficult conditions for the opening of accounts by proxies, while others prohibit the participation of proxies in the procedure altogether. At the same time, you should be prepared for the fact that the bank will have to provide a notarized power of attorney, the form of which is set by the bank itself (a power of attorney set out in arbitrary form in the vast majority of cases will not work), as well as a notarized sample of signature of the director (general director) of the company. Some banks are gradually introducing remote account opening without the need to appear at the bank, trying to eliminate intermediaries (trustees) from the process of opening a bank account and at the same time to maintain the level of convenience of their services.

It is worth mentioning that special attention is paid to the corporate governance structure of a legal entity. In many cases the reason for refusal can be a complex corporate structure of the company, which the bank simply can not understand, and therefore one should be able to intelligibly explain the details of the distribution of powers of the governing bodies of the company and the peculiarities of legal forms of companies.

All documents must be certified in the prescribed form. Notarization of foreign documents is a mandatory requirement. In addition, the documents must be internationally legalized (or stamped “Apostille” in the case of the countries concerned). However, for some countries, such as Russia, Belarus, Bulgaria and Georgia, an apostille (legalization) is not required by virtue of existing international treaties with the Republic of Armenia.   

Only after the preliminary review of all documents, which will take some time, the bank will decide whether to open an account or not. In any case, the conditions of all banks are individual and the requirements for opening bank accounts, as well as the range of services provided may vary, so it is worth clarifying all the nuances directly from the bank.