Coredo

Since 2016 I have been building COREDO as a platform where legal precision meets technological practice. During that time the COREDO team has implemented dozens of projects in the EU, the United Kingdom, Singapore, Dubai, the Czech Republic, Slovakia, Cyprus and Estonia: from company formation and obtaining financial licenses to AML consulting and implementing smart contracts into a client’s operating model. In this article I present a systematic view: when and how smart contracts operate as a legally meaningful infrastructure, how to reduce risks and achieve measurable ROI.

Our experience at COREDO has shown that “smart contracts for business” is not about fashion, but about managed automation of obligations in accordance with contract law and regulatory frameworks. I will examine legal statuses in key jurisdictions, issues of recognition in courts, the connection with AML/KYC and data protection, and provide guidance on designing “self-executing contracts” and the economics of implementation (TCO, CAPEX, OPEX and ROI metrics).

Smart contracts: legal reality

Smart contract vs traditional contract

International framework: EU, Asia, CIS

The international framework covers the EU, Asia and the CIS countries, where approaches to regulating smart contracts differ significantly in terms of recognition, evidentiary value and liability. Below we will examine the key legal features and practical implications for each region, starting with the legal status of smart contracts in the EU.

Legal status of smart contracts in the EU

Legal status of smart contracts in Asia

International regulation: UNCITRAL

Legal force and recognition in court

Understanding the legal force of electronic documents is important for minimizing risks and ensuring their applicability in legal practice. Below we will examine mechanisms of court recognition, enforcement of decisions, features of electronic evidence, and rules for secure storage that determine when digital data become fully admissible evidence.

Recognition of electronic evidence

On-chain and off-chain: mechanisms and arbitration

AML/KYC: data protection

AML/KYC processes, a key tool in identifying and managing risks, require strict adherence to international standards and compliance procedures. Reliable data protection ensures the traceability of operations and reduces the likelihood of leaks, which will form the basis for the discussion of risks, recommendations of FATF and traceability issues.

AML/KYC risks and FATF recommendations

GDPR data protection

Asset licensing and tokenization

Licensing in asset tokenization is a key factor determining the legality and commercial sustainability of projects in the digital rights market. In the following section we will examine in detail which licenses are required and how the MiCA framework shapes requirements for the issuance and circulation of tokens.

MiCA licenses

Tokenization standards

DAO Corporate Governance

Legally compliant smart contracts

Designing requires attention to detail: smart contracts must be legally compliant and drafted so that their execution conforms to legal norms. In the following sections we will review practical steps for drafting and bringing them in line with contract law requirements to minimize the risk of disputes and ensure the enforceability of the terms.

Formalize the contract under contract law

How to legally formalize a smart contract — rely on a master agreement where:

• the parties are defined (legal entities and their on-chain addresses);
• the smart contract is described as a legal agreement, its functions and limitations;
• the role of standard clauses in smart contracts is established: governing law, forum, arbitration, notices, force majeure;
• penalties and sanctions for breach of smart contracts and off-ramp procedures are provided;
• escrow via smart contracts and conditional transfers, time-lock and conditions for deferred performance are described.

Electronic signature: eIDAS and QES

The role and liability of oracles

Reliability and security of technologies

The reliability of the technological platform and ensuring its security are not abstract tasks but mandatory conditions for the stable operation of systems and the preservation of users’ trust. This is achieved through formal verification, independent audits, and a clear allocation of responsibility among the participants in the process.

Formal verification and audit

Upgradeability, versions and SLA

Integration and operational model

Integration of key systems: ERP/CRM and CLM is a prerequisite for building a transparent and manageable operational model where data and processes are aligned across departments. In the following points we will examine which standards and architectural solutions provide such synchronization and how this is reflected in daily operations.

ERP/CRM and CLM standards

How to integrate smart contracts with ERP and CLM — via data buses and events (webhooks) with guaranteed delivery and status mapping.

Operational limits and scalability

Economics of implementation

The economic aspects of implementation determine how viable and cost-effective the project will be in the long term. In this section we will examine key metrics, ROI and TCO, and discuss risk insurance mechanisms that help protect investments and reduce uncertainty.

ROI and TCO in risk insurance

COREDO case studies and best practices

Preparing a company for smart contracts

Regulatory and judicial practice

COREDO turns technology into results

Since 2016 I, together with the COREDO team, have been guiding clients through the full cycle of international structuring: from company registration in key jurisdictions of the EU, the United Kingdom, Singapore and Dubai to obtaining financial licenses, AML consulting and subsequent support. Over the past years we have seen steady interest from entrepreneurs and funds in the Astana International Financial Centre (AIFC). The reasons are clear: English common law, transparent supervision by the Astana Financial Services Authority (AFSA), the flexible regulatory framework of the AIFC rulebook and tangible tax incentives in the AIFC for investors when residency and substance conditions are met.

In this article I have systematized COREDO’s practical experience and set out concrete steps on how to approach obtaining an AIFC investment license, registering funds and building a sustainable compliance model. The text is addressed to those who expect clear timelines, a controlled cost of the process and predictability of regulatory requirements – from fit and proper to IFRS reporting.

Why the AIFC

AIFC: a closed perimeter of English common law with its own court, the AIFC Court, and an independent regulator, AFSA. For financial services the AIFC rulebook applies: Conduct of Business, Prudential Rules, Collective Investment Schemes, AML/CFT and related guidance. COREDO’s practice confirms that for international groups it is a safe entry point to the Central Asian markets, as well as a platform for cross-border capital structures.

From a tax perspective, the relationship between the AIFC and the Kazakhstan tax regime provides incentives to participants in the centre for a number of financial services, exemption from certain local taxes and the ability to apply double tax treaties. It is important to assess the commercial feasibility of opening an office in the AIFC taking into account the investment strategy, investors’ jurisdictions and the operational risk map.

Map of AIFC licenses

Types of AIFC investment licenses are detailed in the AIFC regulatory framework for investment services. The AIFC license map: broker, dealer, manager, depository and related statuses allows flexible selection of the scope of authorisations to suit a business model.

Broker, dealer and market maker

The AIFC securities broker license and the AIFC market-maker and dealer license cover «dealing in investments», «arranging deals», «making a market». Separate requirements apply to algorithmic trading: strategy testing, risk controls and compliance when using algorithmic trading. The COREDO team has implemented projects where access to derivatives and derivative instruments with enhanced limit management was added to the basic dealing permission.

Asset and fund managers

The AIFC asset management license grants the right to «managing investments» for a separate mandate, while the AIFC fund manager license covers management of collective investment schemes. There are also specialized categories: an AIFC alternative investment management license for private equity and VC structures. A solution developed at COREDO often combines a managed account and a fund platform to flexibly onboard both institutional and qualified investors.

Depository and custody

An AIFC depository license and the organisation of custody and asset accounting in the AIFC imply strict segregation of client assets, segregated accounts, as well as restrictions on commingling client and own funds. For some strategies a separate custodian provider is required or outsourcing services: fund administration and custodian with clear SLA and KPI.

Investment adviser

The AIFC investment adviser license (advising on investments) is critical for groups where the portfolio is managed outside the AIFC, while advisory, distribution and oversight functions are performed at the centre. Our experience at COREDO has shown that such a configuration is convenient when AIFC licenses are compatible with European regulations (MiFID) and when a MoU with foreign supervisory authorities is in place.

Digital assets sandbox

An AIFC digital assets trading license is possible through AFSA regimes for Digital Asset Trading Facility and custody of digital assets. The AIFC regulatory sandbox for fintech and tokenisation (regulatory sandbox) allows testing of asset tokenisation models and security tokens in the AIFC before obtaining a permanent license. In several projects, COREDO selected smart contract architectures with legal recognition in the AIFC, ensuring AML compliance/KYC when obtaining an AIFC license.

Regulatory framework of AFSA and AIFC

The rules for regulating investment activity in the AIFC are built on the principles of risk-based supervision and are close to MiFID approaches. AFSA relies on Conduct of Business Rules (COB), Prudential Rules (IPRU), Collective Investment Schemes (CIS) and the AIFC AML Rulebook.

Capital requirements and adequacy

capital requirements for an AIFC license depend on the type of activity: broker-dealer, custodian, manager, consultant. Capital requirements and the calculation of capital adequacy are applied taking into account market, credit and operational risks, as well as off-balance obligations. We prepare ICAAP/ICARA models, portfolio stress testing and liquidity management considering counterparty and credit risk limits.

Corporate governance: fit and proper

The AIFC corporate governance rules define the minimum governance structure required to obtain an AIFC license: a board of directors with an independent director, Senior Executive Officer, Finance Officer, Compliance Officer and MLRO. Requirements for AIFC directors and senior personnel include checks of probity (fit and proper) and fitness and propriety checks for experience, reputation and competence. The COREDO team prepares CVs, competency matrices and justification for role allocation to pass Due Diligence AFSA without delays.

AML/KYC Compliance Program

AIFC compliance requirements for investors and clients imply risk-oriented KYC procedures and CDD for clients, a register of beneficial owners and BO disclosure, as well as AML/CFT policy and requirements. The compliance program—policy, procedures, monitoring—must include sanctions screening, compliance performance indicators (for example, false positive rate for transaction monitoring systems), and the preparation and submission of SARs. COREDO’s practice confirms that correct tuning of thresholds and scenarios in transaction control systems and risk monitoring at the AIFC reduces the burden on the team and improves the quality of risk detection.

Protection of client assets

Restrictions on mixing client and own funds and protection of client assets through segregated accounts: a key element of trust. AFSA requires documented reconciliation procedures, reporting on client assets and regular external audit, as well as independent internal audit if the scale of the business exceeds established thresholds.

Substance and residency in banks

Residency and substance requirements at the AIFC include having an office within the centre’s perimeter, local managers and key functions on the ground. This is especially important for tax benefits and for demonstrating the place of effective management.

Interaction with correspondent banks for AIFC companies and onboarding requires a pre-prepared AML package, a policy on sources of funds and control procedures. In several cases COREDO has arranged a combined solution: local settlement banks for operational flows and foreign correspondent banks for cross-border clearing.

How to obtain an AFSA license

obtaining an AIFC investment license AIFC: this is a project with clear stages. I always start by assessing the business model for compliance with the AIFC rulebook and check which permitted activities are actually needed today and how to keep the option to scale tomorrow.

How to prepare the package and IT environment

Preparing the documentation package for submission to AFSA includes a business plan, financial forecasts, risk, compliance and information security policies, as well as minimum requirements for IT infrastructure and cyber security. AFSA assesses checks for financial soundness and the business plan, the presence of continuity processes, an incident log and a DRP/BCP testing plan. The COREDO team designs internal control procedures and internal audit from scratch, the duties of the Compliance Officer and the MLRO role.

Timelines, cost and communication with the regulator

The timeline for issuing an AIFC license is usually 3–6 months from a correctly prepared dossier, especially if the regulatory sandbox mode for fintech is involved. The cost of obtaining an AIFC license consists of AFSA regulatory fees, expenses for legal preparation, audit and compliance setup, as well as CAPEX on IT and operational environments. In one recent project, a solution developed by COREDO helped reduce the budget by outsourcing the fund administrator and custodian functions until the AUM threshold was reached.

Supervision and reporting

regulatory supervision and AFSA inspections involve regular IFRS reporting, audit opinions, notifications of changes in controllers and risk events. Reporting requirements and IFRS standards are a mandatory part of licensing conditions. In addition, information exchange with foreign regulators (MoU) is in effect, which is especially important for groups operating in multiple jurisdictions.

Funds in the AIFC: registration and listing

registration of an investment fund in the AIFC includes choosing a form: open‑ended or closed‑ended, as well as using SPVs and holding levels to structure flows. Private equity and VC funds in the AIFC often employ closed‑ended models with mechanisms for capital calls and returns.

Fund manager and depository

An AIFC fund manager license allows operating a collective investment scheme provided there is an independent depository. Contracting depositories and beneficiary agreements require a clear compliance architecture: segregated custody, reporting, SLAs and liability clauses. For public products, preparing a prospectus and making disclosures for funds is mandatory in accordance with AFSA requirements.

Listing and exit

Listing and exit opportunities in Kazakhstan via the AIFC are implemented through the AIX, and synergies are also possible when interacting with KASE and international venues. Exit strategies — IPO, asset sales, secondary market — depend on investor profiles and jurisdictions of placement. The COREDO team has helped funds prepare data rooms, assess economic impact and perform investment due diligence for exits to international markets.

Taxes and private equity strategy

The advantages of an AIFC license for private equity funds include simplified dealings with qualified investors, clear rules on carried interest and flexibility in structuring the waterfall. Tax optimization measures and double tax treaties can reduce the tax burden on repatriated profits if the criteria for AIFC participant status are met. ROI metrics for funds in the AIFC are combined with methodologies for valuing illiquid assets, while liquidity management and portfolio stress‑testing are embedded in the investment committee’s regulations.

Liability of license holders

Regulation of derivatives and derivative instruments in the AIFC requires documented limits, margin modelling and close‑out terms. For algorithmic trading, code verification procedures, a change log and pre- and post-trade controls are important.

Compatibility with MiFID and passporting

The compatibility of AIFC licenses with European regulations (MiFID) is reflected in the similarity of approaches to client classification, suitability and product governance. Direct passporting of services through the AIFC into the EU is not applied. Nevertheless, international recognition of AIFC licenses is growing thanks to unified standards, MoUs and participation in IOSCO initiatives.

Using the AIFC for cross‑border investments is convenient when the parent company is in the EU or the UK, and fund management functions for regional deals are located in the AIFC. In such structures, anti‑money laundering and counter‑terrorist financing procedures in the AIFC and the group’s unified KYC/CDD policy are useful.

COREDO Case Studies: how it works

Commercial feasibility

Assessing the scalability of a business model through the AIFC includes a comparison of CAPEX/OPEX scenarios, the AUM growth model and substance requirements. It is often more advantageous to start with lean operations, using outsourcing services: fund administration and custodian, and then insource functions as volumes grow.

corporate structure: holdings, trusts and funds are structured to take into account restrictions on profit distribution and return of capital, as well as the terms for attracting institutional investors. For international jurisdictions we support the employment of foreign personnel and work permits, set up management remuneration policies and monitor the compliance of delegated functions with regulatory expectations.

COREDO Roadmap

• Diagnosis: mapping activities to license “maps” and the AIFC rulebook, risk assessment and capital.
• Designing governance: minimal governance structure, roles SEO/CO/MLRO, independent directors.
• Capital and financial model: capital requirements, ICAAP/ICARA, liquidity stress tests.
• Compliance: AML/CFT policy and requirements, KYC and CDD procedures for clients, sanctions screening, register of beneficiaries.
• Asset control: segregated accounts, agreements with depositaries and custodians.
• IT and cybersecurity: incident log, BCP/DRP, access control and logging.
• Preparation of dossier for AFSA: business plan, policies, fit and proper packages, evidence of substance.
• Bank onboarding: correspondent relationships and source-of-funds control.
• Reporting and audit: IFRS, internal audit, regulatory reporting and interaction with AFSA inspections.
• Scaling: adding licenses (for example, AIFC market‑maker and dealer licenses), going public, international MoU.

Frequently asked questions from clients

• Impact of international sanctions on business in the AIFC. The regulator expects reliable sanctions screening and de‑risking scenarios. We develop processes taking into account the dynamics of sanctions regimes and the data‑sharing requirements under the MoU.
• Passporting services through the AIFC. There is no direct passporting into the EU, but compatibility with MiFID helps build cross‑border chains via subsidiary structures and recognition by banks and counterparties.
• Reporting requirements. In addition to IFRS, AFSA emphasizes risk disclosure, management of conflicts of interest and fee transparency. Prospectus preparation and disclosures for funds: an area of special attention.
• Comparison of the AIFC with EU and UAE jurisdictions regarding investment licenses. The AIFC wins on launch flexibility but requires meaningful substance and discipline in compliance. For groups with an Asian focus this is often the optimal balance.

What a partnership with COREDO provides

I maintain personal involvement in the design of each structure, while the COREDO team supports the project from the initial architecture to the first regulatory inspection. We combine legal expertise, the financial model, AML/KYC practices and operational implementation so that you receive not just a license, but a sustainable business. Our clients appreciate predictable timelines and transparent costs, as well as the readiness to explain complex requirements in plain language.

If you are considering obtaining an ADGM investment license, an ADGM license for investment activities can become the center of your international structure. The regulator AFSA offers clear rules of the game, and tax incentives in the ADGM for investors help increase the returns of strategies. The main thing is to assemble all the elements correctly: from capital and governance to AML/CFT and IT architecture.

Conclusions

The AIFC is a mature yet flexible platform for investment business, fund management and fintech initiatives. The AIFC rulebook and regulations provide clear guidelines: capital requirements, corporate governance rules, KYC/CDD procedures and client asset protection. With proper preparation, obtaining an AIFC investment license takes a reasonable timeframe, and the structure remains scalable and compatible with international standards, including MiFID principles.

I am convinced that success here is built on three pillars: a correct licensing architecture and substance, compliance discipline, and a pragmatic scaling plan. The COREDO team helps establish all three pillars sequentially and without unnecessary iterations. If you need a roadmap — from choosing an AIFC securities broker license or a fund manager license to setting up custody, IFRS reporting and interaction with AFSA, we have proven solutions and experience implementing them.

The future of offshore jurisdictions has long arrived: transparency, digital identification, and risk‑based compliance are setting new rules. In the past it was enough to incorporate a company in the BVI or the Cayman Islands and manage flows carefully. Today offshore tax planning without economic substance, proper KYC and reporting stops working and generates an increased risk of de‑banking and payment blocking.

In this article I have compiled the practice of COREDO through the prism of the challenges faced by entrepreneurs and CFOs from Europe, Asia and the CIS. There are no slogans or “silver bullets” here. There are proven approaches, cases and tools that help safely register companies abroad, obtain financial licenses, build AML compliance and maintain access to correspondent banks in the era of total financial transparency.

The Future of Offshore Jurisdictions

The role of FATCA and CRS in de-anonymization is obvious: banks, service providers and tax authorities can see the ultimate beneficiary (beneficial ownership) and the structure of the ownership chain. The automatic exchange of tax information makes the “don’t show” strategy obsolete. It is now more important to build a correct reporting model and demonstrable economic substance in offshore jurisdictions than to try to hide behind nominee directors.

At the same time, BEPS’s influence on offshores is strengthening: rules on controlling passive income, limits on interest deductions, CFC approaches and real-activity tests cut the margin of “empty” structures. The COREDO team has carried out dozens of restructurings in which abandoning offshores in favor of onshore or mid-shore solutions increased access to financing and reduced overall risk.

Risks and benefits of offshore registration

Registering a legal entity in an offshore jurisdiction still provides advantages: flexibility of corporate law, fast administration and neutrality for holding functions. On the other hand, de-banking and strict criteria for access to correspondent banking relationships make the standalone existence of an offshore structure difficult. Banks assess PE risk (permanent establishment), substance and UBO as carefully as tax authorities.

Reputational risks of offshore structures for public companies have grown: investors request reputational due diligence in the style of Transparency International standards and assess the impact of the UBO structure on the ESG profile. In COREDO projects public issuers increasingly choose alternatives to traditional offshore jurisdictions: Cyprus, Malta, Ireland, Luxembourg, the UAE and Singapore provided there is real activity, an office and resident directors.

Economic substance: requirements

Economic substance (economic substance) is not a set of “tick-boxes”, but a managerial necessity. Requirements for a local director and substance in island jurisdictions are increasing: an office, employees, on-site management decisions, contracts and key risks in the jurisdiction. Relying on nominees no longer works: nominee director risks (nominee director risks) manifest in bank refusals, tax issues and fines.

From an economic standpoint, substance requirements help reduce PE risk, confirm the center of management and control (mind and management), and pass bank scoring. COREDO’s practice confirms: when the board of directors actually meets in Cyprus or Dubai, and the CFO and risk function operate in the EU, regulators’ concerns are resolved faster. This is reflected in lower financing costs and greater resilience of the operating cycle.

New contours have appeared in reporting: substance reporting and reporting against shell company criteria. Regulators request minutes of meetings, employment contracts, leases and local tax payments. Our experience at COREDO has shown that it’s better to invest in a real team and processes than in “paper” substance. It’s easier to defend with banks and tax authorities, and it reduces overall costs over a three-year horizon.

Compliance of offshore structures: KYC and DAC6

In working with offshore structures, compliance covers a wide range of requirements – from KYC and AML procedures to mandatory reporting under DAC6. Below we consider practical approaches, including e-KYC, that help minimize risks and ensure compliance with international standards.

How to comply with AML/KYC and e-KYC for offshore structures

Complying with AML when using an offshore is not a question of legal form, but of the quality of data and processes. I use a risk-based approach: AML risk scoring based on geography, business model, source of funds and transaction profile. AML/KYC automation tools (SaaS), integration of compliance processes into ERP/CRM and regtech solutions for KYC reduce onboarding friction and improve client UX without loss of quality.

AMLD5 and AMLD6 require beneficial ownership verification, enhanced (Due Diligence, EDD) for complex structures and ongoing monitoring. Transaction monitoring systems and sanctions screening are now standard not only for banks, but also for fintechs and payment companies. The COREDO team developed an e-KYC framework and digital identification using pseudonymization to balance privacy vs. transparency, which facilitates cross-jurisdictional data exchange.

International reporting: CRS, FATCA, CbC

Automatic exchange of information (CRS) and offshore jurisdictions are in a new linkage: account and beneficiary data are transferred under international data exchange agreements. FATCA strengthens checks for clients with US ties, and banks form additional requirements for describing flows, sources and control over UBOs. At COREDO we build a reporting calendar to synchronize CRS, local declarations and corporate obligations.

Consultants’ obligations: DAC6 and ATAD

DAC6 and reporting obligations for advisers require declaring “schemes” with indicators of tax advantage. This changes the role of advisors: the legal liability of advisers and directors becomes personal and requires strict procedures. The solution developed at COREDO includes “red flags” checklists, a roles matrix and a board decisions log to confirm business purpose and compliance with anti-avoidance rules and ATAD.

Directors increasingly must be residents of the relevant jurisdiction and actively participate in management. Requirements for director residency and the elimination of nominee directors strengthen the resilience of the structure and help with banking compliance. This approach gives confidence to investors and reduces the likelihood of being classified as a shell company.

Restructuring: from secret to transparent

Restructuring strategies help organize the transition from secret structures to transparent ones, reducing risks and improving business manageability. Below is a practical step-by-step transition plan that shows which actions and priorities need to be implemented at each stage.

Steps for transitioning to transparent structures

The transition from secret structures to transparent ones begins with a map of risks and objectives. I propose a step-by-step plan: audit of the structure for UBO and PE risk, benchmarking substance, assessment of TCO and ROCI, aligning the roadmap with regulatory and banking timelines. Then: phased compliance and possible sunset clauses to close old links without impacting cash flow.

The next stage: aligning corporate documentation, updating contracts, notifying banks and counterparties. COREDO’s practice confirms that a pre-prepared communication package for banks and auditors shortens lengthy approvals and keeps correspondent channels open. This is especially important when licensing payment institutions and fintech providers.

Redomiciliation vs closing an offshore company in the EU

Migration of a company from an offshore to the EU is possible via re-domiciliation or liquidation followed by registration. Migration cases — re-domiciliation vs closure — depend on assets, contracts and licenses. The COREDO team implemented scenarios where re-domiciliation provided continuity of contractual relationships, and in others: closure and transfer to a new legal entity reduced regulatory risks and simplified bank scoring.

I always include an assessment of the impact on CbC, transfer pricing and possible triggers for anti-avoidance rules. Legal support for international holdings at this stage is critical: taxation agreements, substance in the new jurisdiction, and ATAD requirements for controlled foreign companies must align without contradictions.

Beneficial ownership and the UBO registry

Rebuilding the ownership structure and the UBO registry is not only a formality but also an element of trust in the group. The register of beneficial owners (UBO registry) and beneficial ownership verification require complete and up-to-date information, as well as compliance with local definitions of control. At COREDO we implement an annual re-verification procedure so that changes in shareholdings, option agreements or trusts are timely recorded in the registry.

The consequences of disclosing beneficial owners for investors are usually positive with correct governance settings. A transparent board of directors, clear voting rights and minority protection strengthen the company’s valuation and reduce the structural discount. This is especially noticeable in transactions with institutional investors and in industry due diligence standards for venture investments.

Tax risks associated with dividend repatriation

Dividend repatriation requires synchronization of double taxation agreements, a beneficial ownership test for the income and substance at the holding. I recommend agreeing tax rulings or an APA in advance for significant flows, and also documenting mind and management at the level of the dividend recipient. This reduces the risk of requalification and claims under ATAD and local anti-avoidance rules.

It is important to link this with transfer pricing documentation and CbC so that dividends and intra-group services do not conflict in the logic of functions, risks and assets. The COREDO team builds tax planning models with economic substance, where profit allocation is supported by real centers of competence and personnel in the relevant jurisdictions.

Offshore doesn’t work: fintech licensing

When licensing payment institutions, forex dealers, crypto providers and electronic money issuers, an offshore form often slows access to banking infrastructure. De-banking and access to correspondent banks depend on transparency, sanctions profile and jurisdiction of registration. Our projects in the EU, the UK, Singapore and Dubai show that onshore structures open doors faster and provide stable operations.

Fintech and open APIs for banks require provable control over transactions and customers. Asset tokenization and smart-contract compliance help here, along with a built-in blockchain audit trail for transparency and the use of blockchain for transparent reserve reporting. The COREDO solution integrates regtech tools into core banking and processing, which eases licensing and compliance verification.

Company registration in the EU, Asia and Africa

Legal company registration in the EU for international business requires attention to ATAD, substance and local accounting and audit requirements. Cyprus, Estonia, Czechia and Slovakia set clear rules of the game, and e-residency and digital company registration in Estonia shorten onboarding times and allow managing processes remotely. It’s important to establish KYC processes for clients and suppliers from the start to avoid having to rework infrastructure for the bank.

Business registration in Asia and Africa: the compliance checklist covers sanctions risks, local requirements for an office and directors, and specifics of currency control. Singapore demonstrates a high standard of governance and access to financing, while a number of African jurisdictions require closer engagement with banks and regulators. The COREDO team adapts checklists by industry to speed up account openings and integration into payment networks.

Responsibility in tax planning

Advance pricing agreements and tax rulings reduce uncertainty, especially for IP centers and service hubs. Transparent intellectual property management schemes that take into account marketing and R&D functions in the relevant locations help avoid being classified as a shell company. At COREDO we design the corporate structure of the holding so that transfer prices reflect reality, and that CbC and local files do not contradict each other.

Requirements and due diligence for trusts

Trust structures and requirements for registration of trusts have tightened: trust register, disclosure of the settlor, protector and beneficiaries, as well as trustee due diligence have become the norm. The beneficial owner in the context of a trust is interpreted more broadly than in corporate structures and requires additional communication with banks. I recommend using independent trust administrators with a proven track record and a transparent KYC policy.

Beneficial ownership verification for trusts relies on evidence of the source of funds and mechanisms for controlling distributions. The COREDO team builds procedures under which distributions from the trust align with their purposes and are documented in a single register, available for audit and to banks. This increases the likelihood of successful account openings and reduces operational delays.

Metrics and the return on transparency

The cost of maintaining transparency for a business is an investment that pays off by reducing risks and providing access to capital. I use three metrics: TCO of the structure taking substance into account, ROCI as the effect of compliance on margin, and probability × impact × cost as the basis for risk scoring. This approach allows the CFO to defend the compliance budget before the board of directors.

COREDO cases: from legacy to onshore

In COREDO cases we analyze real business transformation scenarios: the move from legacy structures to onshore solutions, covering jurisdictional, managerial and tax changes. The first example is dedicated to relocating a fintech group from the BVI to Cyprus and to the Czech Republic with a detailed breakdown of the stages, risks and benefits of such a transition.

Relocating a fintech from the BVI to Cyprus and the Czech Republic

Practical cases: moving a business from offshore to onshore delivers a measurable effect when a bank starts lowering limits or dragging its feet on letters of credit. For a fintech group with processing, we migrated the holding from the BVI to Cyprus and moved the operational office to the Czech Republic. Substance: the director, risk officer and product management were placed in Cyprus, which opened new correspondent lines and sped up licensing approvals.

Re-domiciliation of the holding company to Singapore

For an investment holding, we carried out re-domiciliation (jurisdiction transfer) from the Cayman Islands to Singapore. The LP investor market required a more “regulated” domicile and improved access to Asian banks. We strengthened governance, reinforced the board with an independent resident director and implemented transaction monitoring systems with e-KYC, which reduced onboarding friction for portfolio companies.

As a result, the holding gained access to several banks with strong correspondent banking relationships. The project was completed without loss of contractual continuity and improved the fund’s valuation among institutional investors, as confirmed by their due diligence.

Closure of the Malta SPV and creation of substance

In the third case we chose to close the Malta SPV due to rising compliance costs and banking restrictions. Instead, we opened a holding and an operating company in Dubai, where we formed a real team, office and board of directors. Payment services licensing went through faster than expected, and a blockchain audit trail for reporting on client funds increased banks’ confidence.

Preparation for an international AML review

How to prepare a company for an international AML review should start with a gap analysis and process maps. I recommend implementing AML risk scoring, sanctions screening, EDD triggers for high-risk clients, and automatic transaction monitoring. This is the basic layer that banks and regulators expect to see in any licensed company.

Next comes digitization: e-KYC and digital identification, regtech for offshore compliance, pseudonymization of client data (pseudonymization) and secure data exchange with providers. Integrating compliance processes into ERP/CRM reduces manual work and human error. COREDO’s practice confirms that such a stack reduces bank response time and facilitates scaling to new markets.

When to close an offshore company

Sometimes the best choice is to close an offshore company. An exit strategy for offshore structures is justified when TCO grows faster than the benefits, the jurisdiction lands on an offshore blacklist, and banks impose strict limits. In these cases a phased exit with the redistribution of functions and assets to onshore reduces shocks and preserves the client base.

Legacy structures and restructuring require a clear plan for transferring contracts, IP and personnel. Reputation risk management models for investors include proactive communication about the reasons for changes, updating the UBO registry and confirmation of compliance standards. The COREDO team helps carry out this process without payment interruptions or operational risks.

Transparent transfer pricing

Transparent intellectual property management schemes are based on real R&D and marketing functions. The identification of shell companies and substance tests quickly reveal discrepancies if the IP hub “exists on paper”. We recommend early dialogue with tax authorities, an APA request and establishing a product management function in the jurisdiction where the IP is located.

Transfer pricing documentation, master/local file and CbC create a single narrative for the auditor, the bank and the tax authority. This way the business avoids penalties for non-compliance and reduces the risk of retroactive assessments. Within COREDO we support such projects comprehensively: from licensing and bank account opening to regtech integration and building substance.

Transparency by default and partnership

The future of offshore is about both offshore structures and transparency. creating an offshore company in 2026 is possible and rational if the structure relies on economic substance, proper compliance and a clear business purpose. The alternative: a deliberate move away from offshore in favor of onshore jurisdictions with a strong banking infrastructure and access to capital.