What an ICSP licence actually guarantees you

Ask a founder what they checked before choosing a provider and the answer is usually price and turnaround. Neither is regulated. What is regulated is whether the firm is allowed to hold your company at all, and that question is answered by a single licence under the International Corporate Service Providers Act, 2003.

Which entities need a licensed provider

The Act applies to what it calls specified entities: international business companies, companies holding a special licence, limited partnerships registered under the Limited Partnerships Act, and foundations. Each of those must keep a registered office in Seychelles and a registered agent holding an ICSP licence, for the whole of its life. There is no do it yourself route and no expiry on the requirement.

What the licence obliges the provider to do

• Identify and verify beneficial owners before a relationship begins, and keep the workpapers.
• Assess source of funds and source of wealth, and treat politically exposed persons as a higher risk category.
• Report where the framework requires it, and cooperate with the Financial Services Authority.
• Keep statutory registers and records available at the registered office.
• Remain fit and proper. The standard applies to directors, shareholders and the money laundering reporting officer, not only to the firm.

Why a bank cares more than a client does

A correspondent bank does not assess your structure directly; it assesses the quality of the provider that documented it. A file assembled by a supervised provider, with a consistent ownership chart, dated resolutions and current due diligence, reads as a lower risk counterparty. A file assembled cheaply, by a provider that has since disappeared, reads as a reason to decline.

What to ask before you sign

• Which licence categories does the firm hold: corporate, trustee, foundation?
• Where will the registers and accounting records physically sit?
• What is the fee for the second year and each year after it?
• What happens to the file if the provider's licence is varied or revoked?

Those four questions cost nothing to ask and answer most of the risk in the relationship. If the answers arrive slowly or in general terms, that is itself the answer.