Why do even experienced entrepreneurs and financial directors make mistakes at this stage? Often, due to underestimating the complexity of compliance, the specifics of regional registries, AML (Anti-Money Laundering) and KYC procedures, as well as the lack of a transparent risk management system. How to avoid these pitfalls? How to ensure legal business support and minimize reputational and financial risks while entering foreign markets?
Foreign Counterparty Check
Collecting Information about the Company for Analysis
The first step is gathering and verifying basic information through international company registries (Company Registry), electronic catalogs (Europages, Open Ownership), and chambers of commerce. At this stage, it is important to obtain:
- Certificate of Incorporation, Extract from Company Registry;
- Articles of Association;
- Information about directors, shareholders, registration address, and actual location.
The solution developed at COREDO involves the use of both official state registries and open public sources of information for preliminary data verification. It is important to request a notarized translation if the documents are in an irrelevant language.
Beneficiaries and Company Structure Check
The next step is analyzing the corporate structure of a foreign company and identifying the ultimate beneficial owners (Ultimate Beneficial Owners, UBO). This is critical for compliance with international AML standards and preventing risks associated with hidden owners or offshore structures.
The COREDO team has implemented projects where Orbis, Dun & Bradstreet, Open Ownership databases, and local court databases are used to verify the company’s beneficiaries. Special attention is given to:
- Transparency of the corporate structure;
- Verifying for nominee directors and shareholders;
- Verification of company representatives’ authority.
For complex cases, for example, when working with Asian or offshore jurisdictions – we recommend using international databases and specialized services to identify hidden beneficiaries and track ownership structure changes.
How to Assess a Company’s Financial Stability
Practical tools:
- Request audited financial statements for the last 2-3 years;
- Check credit rating through Dun & Bradstreet, Orbis;
- Analyze transactional activity and payment discipline;
- Assess business reputation through reviews and ratings in international databases.
Particular attention is paid to transactional monitoring and financial compliance analysis: this helps to identify anomalies related to money laundering or corporate fraud.
For a comprehensive picture of reliability, it is also important to check court disputes and current debt obligations.
Checking Court Disputes and Debts
Legal checks of foreign companies and analysis of litigation history are mandatory steps for assessing reputational risk and the legal cleanliness of a transaction. COREDO’s solutions include:
- Monitoring court databases by the place of company registration;
- Checking for debts and fines;
- Analysis of anti-corruption audits and media mentions;
- Assessing business reputation through international databases and public sources.
Checking for Sanctions and Restrictions
Checking a foreign company for sanctions and restrictions: a key element of AML support and financial compliance. International sanctions lists (OFAC, EU Sanctions, UN Sanctions) and local databases are used.
COREDO’s practice confirms: to minimize risks, it is important not only to check the company but also all its beneficiaries and affiliated persons for inclusion in sanctions lists. Moreover, it is necessary to ensure that all licenses and permits are in place, especially when it comes to financial, crypto, or payment services.
Foreign Company Verification: Europe, Asia, Africa
Regional specifics require adapting approaches to counterpart verification. The solution developed by COREDO considers the peculiarities of the legal environment, registry availability, and transparency level in Europe, Asia, and Africa.
Company Verification in Europe
Europe has a developed Company Registry system and unified KYC and AML standards, enshrined in EU directives. For verifying a counterparty in Europe, the following are used:
- Official registries (e.g., Czech Commercial Register, UK Companies House, Estonian e-Business Register);
- European databases (Orbis, Open Ownership, Europages);
- License and permit verification services.
Company Verification in Asia
Verifying a partner in Asia requires accounting for regional features of corporate law and specifics of local registries. In Asian countries (Singapore, Hong Kong, UAE), closed corporate structures are often used, and access to beneficiary information may be restricted.
COREDO’s team has implemented projects where comprehensive verification of a foreign counterparty in Asian countries applied:
- Local Company Registry and specialized databases;
- Verification of licenses and permits through official regulators (e.g., Monetary Authority of Singapore);
- Analysis of corporate structure and identification of hidden beneficiaries using international services.
Special attention is paid to checking the legal cleanliness of transactions and analyzing risks associated with regional compliance features.
Company Check in Africa
Checking a company in Africa is associated with limited accessibility of public registries and a high proportion of offshore jurisdictions. The COREDO solution includes:
- Using African registries and local chambers of commerce;
- Checking business activity and tax discipline through open sources and international databases;
- Risk analysis of offshore structures and compliance features.
Foreign Counterparty Verification Tools
Effective verification of a foreign partner is impossible without the use of modern tools and services, ensuring access to up-to-date information and international compliance standards.
What are International Databases?
- Check registration and status of the company;
- Assess the transparency of the corporate structure;
- Get information about beneficiaries and business activities.
In COREDO’s practice, Open Ownership and Orbis services are especially in demand for verifying corporate connections and history of ownership structure changes.
Website Check Services: Paid and Free
For checking court disputes, financial stability, and credit history, both paid and free services are used:
| Service | Type | Capabilities |
|---|---|---|
| Dun & Bradstreet | Paid | Credit reports, financial history |
| Orbis | Paid | Corporate structure, beneficiaries |
| Open Ownership | Free | Connections and beneficiaries |
| Court databases | Free | Court disputes, arbitration decisions |
| Europages | Free | Basic company information |
COREDO’s solution involves integrating multiple sources to obtain an objective picture and minimize verification errors.
Documents for Verification
- Certificate of Incorporation, Extract from Registry;
- Articles of Association;
- List of directors and shareholders;
- Documents confirming representatives’ authority;
- Financial statements for the last years;
- Licenses and permits;
- Certificates of no debts and legal disputes.
If necessary, notarized translation of documents and legalization for use in another jurisdiction.
AML and Legal Support in International Business Registration
AML Requirements: How to Comply?
To comply with international AML standards it is necessary to:
- Implement an internal control system and regular transaction monitoring;
- Conduct beneficiary identification and verification (KYC);
- Check the company and affiliated individuals against international sanctions lists (OFAC, EU Sanctions);
- Conduct regular anti-corruption audits and analyze funding sources.
COREDO’s solution includes the development of individual AML policies and client support at all verification stages.
Risk Verification in Business Processes
Integrating foreign counterpart verification into the company’s risk management strategy allows:
- Increase partnership’s information security;
- Minimize reputational and financial losses;
- Ensure long-term business sustainability.
Mistakes in Foreign Partner Verification
Common mistakes in checking a foreign partner:
- Focusing only on official documents without analyzing court disputes and reputation;
- Ignoring the verification of beneficiaries and corporate structure;
- Insufficient attention to AML requirements and sanctions restrictions;
- Lack of regular monitoring and information updates.
How to Check a Foreign Partner for Business
Foreign Partner Verification – Checklist
| Verification Stage | Tools/Documents | COREDO Recommendations |
|---|---|---|
| Collection of Basic Information | Company Registry, Europages, registry extract | Request a notarized translation |
| Corporate Structure Verification | Orbis, Open Ownership, Articles of Association | Analyze change history |
| Beneficiary Identification | Dun & Bradstreet, Open Ownership | Check for nominee owners |
| Financial Stability Assessment | Financial statements, credit reports | Request audited reports |
| Check for Legal Disputes and Debts | Court databases, no debt certificates | Monitor regularly |
| Sanctions and Restrictions Check | OFAC, EU Sanctions, local sanctions lists | Check all affiliated individuals |
| Licenses and Permits Verification | Official regulators, licenses | Verify authenticity |
| Business Reputation Analysis | International databases, reviews, ratings | Use several sources |
| Representatives’ Authority Check | Articles of Association, powers of attorney | Cross-check with registries |
| AML Support | Implement internal control system, KYC | Regularly update procedures |
Choosing Services and Documents
- Use a combination of international and local registries for maximum information completeness.
- Request originals and notarized copies of documents.
- Implement regular monitoring of corporate structure and sanctions list changes.
- Ensure verification integration into business processes through automation and staff training.
Foreign Partner Verification, FAQ
How to verify the authority of representatives of a foreign company?
Request Articles of Association and powers of attorney, and check information in Company Registry and Open Ownership.
What documents to request from a foreign company for reliability verification?
Registry extract, Articles of Association, list of directors and shareholders, financial statements, licenses, certificates of no debts and legal disputes.
How to verify the registration address and actual location?
Cross-check data from official registries with the actual office information, use electronic company catalogs and public sources.
What services to use for checking beneficiaries of a foreign company?
Orbis, Open Ownership, Dun & Bradstreet, local Company Registry.
How to check if a foreign company is under sanctions?
Use international sanctions lists (OFAC, EU Sanctions), and also local databases.
Let’s move on to the stages of comprehensive verification for international business registration.