Investment advice as a commercial fee financial investment advisor - granting of permission

Prerequisites

Permission to trade as a fee-based financial investment advisor is granted to you if you

• are reliable
• live in orderly financial circumstances,
• be able to provide proof of professional indemnity insurance and
• have successfully passed a proficiency test at a chamber of industry and commerce or be able to demonstrate this required proficiency through an equivalent professional qualification.

Documents required

For the examination for permission to work as a fee-based financial investment advisor, you must submit the following documents:

• a certificate of good conduct for submission to an authority
• an excerpt from the central trade register,
• if applicable, a certificate in tax matters from the tax office,
• if applicable, a clearance certificate from the municipal tax office,
• an extract from the register of debtors of the central enforcement court,
• if necessary, the information from the insolvency court on the freedom from insolvency and the dismissal of the opening of proceedings due to insufficient assets,
• proof of professional liability insurance,
• proof of the required expertise and
• for legal entities and commercial partnerships: the extract from the commercial register

Please note

1. Scope of Permission
You can apply for permission to work as a fee-based financial investment advisor for all product categories (open funds, closed funds, investments within the meaning of Section 1 Paragraph 2 of the Investment Act), but it can also be restricted to individual categories.

2. No dual license for financial investment brokers and fee-based financial investment advisors
Permission to act as a financial investment broker according to Section 34f of the Trade Code and as a fee-based financial investment advisor according to Section 34h of the Trade Code are mutually exclusive. Anyone who already has a license as a financial investment broker can only obtain a license as a fee-based financial investment advisor if they waive their license as a financial investment broker.

Procedure

1. Request for Permission
You must apply to the competent authority for permission to work as a fee-based financial investment advisor. Depending on the federal state, this is the trade authority or the chamber of industry and commerce.
Individuals (natural persons) apply for permission themselves or through authorized third parties. In the case of legal entities, the application is submitted by their legal representatives or by third parties authorized in writing.
2, notice of permission
Permission is granted to you in the form of a permit notice.
3. Entry of Permission
After starting work as a fee-based financial investment broker, you must immediately apply for entry in the register in accordance with Section 11a Paragraph 1 of the Commercial Code

Fees

There will be charges. Please call to inquire about the fee.

Legal basis

§ 34h trade regulations (GewO)

You need a commercial license for your work as a fee-based financial investment advisor if you

• advise on transactions with certain financial instruments and your recommendation is based on an examination of the investor’s personal circumstances (section 1 (1a) number 1a of the Banking Act),
• Advise on a commercial basis about financial investments within the meaning of Section 34f paragraph 1 number 1, 2, or 3 of the trade regulations and
• this advice is not remunerated on a commission basis from a provider of financial investments, but only against a fee from your customer.

The systems mentioned in § 34f paragraph 1 number 1, 2, or 3 of the trade regulations are

• Units or shares in domestic open-ended investment funds, open-ended EU investment funds or foreign open-ended investment funds that may be sold under the Capital Investment Code (open-ended funds),
• Units or shares in domestic closed-end investment funds, closed-end EU investment funds or foreign closed-end investment funds that may be marketed under the Capital Investment Code (closed-end funds) and
• Asset investments within the meaning of Section 1 Paragraph 2 of the Asset Investment Act (e.g. company investments, profit participation rights, profit-participating loans, subordinated loans).

The fee-based financial investment advisor may also broker these products to the customer, but must then pass on an inducement (commission) that he receives from the product provider to the customer.