Opening IB US account from EU?

[Martin Everson]

Back to the original topic posted. I totally missed PRIIPS as it does not affect me at all as a professional investor plus I only ever buy bonds. But yes he is right as a "retail" investor you cannot any longer buy any investment products including US ETF's in EU without a KIID being provided 😱. If ETF issuer refuses to provide one then that ETF should not be available to retail clients in EU by the broker 🙁.

PRIIPs Regulation | IB Knowledge Base

@mentalmind apologies I didn't understand fully the issue at hand. So either become re-classified as a professional investor in EU or operate outside the EU like you were originally intending to do.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[mentalmind]

Thanks Martin and others for the info. I believe my only bet is signing up and saying im residing at my non-EU country and provide related papers. The only issue is I'm one of the risky non-EU countries that not sure many US brokers would open account to. I know IB does but they have 10 bucks per month cost if you don't have enough transactions to generate the same cost. I'm not willing to deposit 1500 bucks or even more to create an account so for now my best bet is IB. But I will be looking for cheaper alternatives of IB.

 

[Daves]

Very enlightening discussion for me. Thanks guys for such place. Everything is clear except for one question:

If EU-residents are forced to register to IB UK entity instead of IB US so they are definitely subject to CRS then?

Being EU-resident I got to this forum looking for a possibility to open individual account at IB US because it's free of CRS.

Is there a chance for me as EU-resident to open an account in IB US or at IB anyhow and no to be subject to CRS?

Thank a lot for answers in advance!

 

[Martin Everson]

Daves said:
If EU-residents are forced to register to IB UK entity instead of IB US so they are definitely subject to CRS then?
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Yes

Daves said:
Is there a chance for me as EU-resident to open an account in IB US or at IB anyhow and no to be subject to CRS?
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Yes. You can try a IB white label broker in a non-CRS country i.e Caucasus Capital in Georgia or Ameria Bank in Armenia to name a few. Not sure what questions the IB white label platform will ask though as its sometimes beyond the white label brokers ability to control what info IB wants.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Daves]

Martin, thanks a lot for your qualified answer! Wow, I didn't know that there are white labels of IB. Good to know. This forum is definitely worth it.

Unfortunately white labels of IB are not an option for me...

Is there any other chance or workaround to open an account in IB US for me as EU-resident?

If I have to pay for this great piece of advice, please let me know, I need to open an account urgently, so I will be grateful for any support in this issue.

 

[Martin Everson]

Daves said:
Is there any other chance or workaround to open an account in IB US for me as EU-resident?
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Zero chance.

Daves said:
If I have to pay for this great piece of advice, please let me know, I need to open an account urgently, so I will be grateful for any support in this issue.
Click to expand...

Money can't fix what is policy at IB i.e EU residents open with IB's EU entity.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Daves]

Oh. So bad.

One more question. I hope I still have some credit of questions 🙂

Is any of following brokers:

Fidelity
Charles Schwab
E*TRADE
Merrill Edge
TradeStation
tastyworks
Ally Investment
Sogo Trade

enables opening of individual account in their US-entity for EU-residents (thus avoiding CRS)?

Thanks again!

 

[Spinat]

Daves said:
Fidelity
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That one requires a link, there are so many companies with that name.

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Specialized in advisory service for tailor made Offshore setups with banking and payment processing. Privacy and Anonymity is my priority.
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[Martin Everson]

Daves said:
Is any of following brokers:

Fidelity
Charles Schwab
E*TRADE
Merrill Edge
TradeStation
tastyworks
Ally Investment
Sogo Trade

enables opening of individual account in their US-entity for EU-residents (thus avoiding CRS)?
Click to expand...

No.

They will report under FATCA anyway. See the FATCA thread below. Read the thread FULLY and you will fully understand you are wasting your time. I have discussed subject in significant detail even covering brokerage accounts and don't wish to repeat it here again. If you have any questions after reading that thread then ask away.

https://www.offshorecorptalk.com/th...-report-non-us-person-deposits-in-them.22676/

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Btraveler]

Martin Everson said:
Yes



Yes. You can try a IB white label broker in a non-CRS country i.e Caucasus Capital in Georgia or Ameria Bank in Armenia to name a few. Not sure what questions the IB white label platform will ask though as its sometimes beyond the white label brokers ability to control what info IB wants.
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Hello there team,

Has anybody used Caucasus Capital in Georgia or Ameriabank for trading? Some results, issues or rating?

 

[JustAnotherNomad]

By the way, does IB still use UK for EU customers? I think I read somewhere that they wanted to move the EU operations to Luxembourg because of Brexit?

 

[Martin Everson]

JustAnotherNomad said:
By the way, does IB still use UK for EU customers? I think I read somewhere that they wanted to move the EU operations to Luxembourg because of Brexit?
Click to expand...

Yes they use Luxembourg now for EU clients since Brexit.

Home | Interactive Brokers Luxembourg SARL

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[AMD]

Martin Everson said:
EU without a KIID being provided
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What does it stand for?
https://www.ig.com/uk/investments/s...vestor-information-document--kiid--definition
??

 

[BSA]

AMD said:
What does it stand for?
https://www.ig.com/uk/investments/s...vestor-information-document--kiid--definition
??
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As its written. In fact, it is nothing but a strangulation to keep EU Citizens from Investing in Non-EU Investment Products. As I see it it came together with the MIFID II Regulations which effectively seem to only have only one goal: kill the Brokers by bureaucracy and keep their clients away of Non-EU Investment Products (where possible as they can't prohibit the purchase of US Stocks)

In Fact it lead to the following Situation:

US ETFs or other Structured Investment Products need to be UCITS Conform what might be that much bureaucrathic that it doesn't make sense for many Products. All US ETFs are prohibited until they get replicated within the EU itself (if so, then mostly in LUX and IRE)

If the ETF is not replicated within the EU itself and further on has no "Clients Information Paper" no Broker will any EU Citizen purchase it. From ARK over RPAR, to QQQ, any of the VanEck BDC ETFs and even VXX. Canadian Income Trusts and other Products are also not investable. But what (still?) works are BDCs themselves as e.g. GSBD and any REITs as they are handled as Stocks. As long as I know CEFs are on the other hand not purchaseable. So one can say that there is a huge amount of Investment and Trading Vehicles just even not possible to invest in for Europeans.

BTW that is also one of the two reasons I was and still am looking for a well suited US Broker Solution. Honestly, 1st is SIPC Protection (we got 20k € Min up to normally max 100k € here while there are still Brokers guaranteeing more, but there prices for one single Order start at 10€) while 2nd is the free access to US Investment Products.
And yes Sir, IBUK (UK Protection Scheme + US SIPC) is since Brexit not an available Option for Europeans anymore, instead we are allowed to use IB Accounts in LUX (max 20k €), IRE (max 20k €) and HUN(gary) (up to 100k €).

While a US LLC (Corp-Class) might be a nice workaround, honestly I'd still have to assess whether it would be really worth it...? Honestly, actually I don't think so.

All the Best
BSA

 

[Radko]

Daves said:
Oh. So bad.

One more question. I hope I still have some credit of questions 🙂

Is any of following brokers:

Fidelity
Charles Schwab
E*TRADE
Merrill Edge
TradeStation
tastyworks
Ally Investment
Sogo Trade

enables opening of individual account in their US-entity for EU-residents (thus avoiding CRS)?

Thanks again!
Click to expand...

Hi, did anyone manage to find a way to invest in U.S. ETFs being a resident of the EU?
And does anyone know if investors living in the UK are now able to buy U.S. ETFs through IBKR after Brexit? Or the UK still does not allow investing in U.S. ETFs?
I'm looking to open an account with a Broker that will allow me to invest in the U.S. market without any restrictions, so U.S. ETFs as well, as a non-dom UK resident, or is it still my only option to try opening a Professional account with IBKR so they then allow me to buy everything I want in the U.S. market?
Any other alternatives, maybe by using another Broker based in the U.S., not in the UK, would that be easier, if so which Broke?
Anyway, I hope some can help, thanks in advance.
(EU restricting people from Europe on what they can or cannot do with their money! What kind of freedom is that! Who's idea was that, Von der Leyen?)

 

[Huringa]

Radko said:
Hi, did anyone manage to find a way to invest in U.S. ETFs being a resident of the EU?
And does anyone know if investors living in the UK are now able to buy U.S. ETFs through IBKR after Brexit? Or the UK still does not allow investing in U.S. ETFs?
I'm looking to open an account with a Broker that will allow me to invest in the U.S. market without any restrictions, so U.S. ETFs as well, as a non-dom UK resident, or is it still my only option to try opening a Professional account with IBKR so they then allow me to buy everything I want in the U.S. market?
Any other alternatives, maybe by using another Broker based in the U.S., not in the UK, would that be easier, if so which Broke?
Anyway, I hope some can help, thanks in advance.
(EU restricting people from Europe on what they can or cannot do with their money! What kind of freedom is that! Who's idea was that, Von der Leyen?)
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Also interested in this. Did you find some way to do it?

Thank you

 

[Radko]

Huringa said:
Also interested in this. Did you find some way to do it?

Thank you
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Just try to open a professional account with Interactive Brokers, that will allow you to buy US ETFs.

You can also form an LLC in the US and open an account with a US broker in the name of the LLC.

 

[Martin Everson]

Or just use a broker outside EU to get around EU PRIIP rules. EU PRIIP prevents EU resident retail investors access US ETF's where US ETF's do not provide EU investors with a PRIIP KID. A lot of US ETF's don't want to provide this and EU brokers don't want to hand check every US ETF for a PRIIP KID so just blanket ban restriction to retail investors.

So just hold your brokerage account outside the EU which is wise in today's world in case you need to flee Europe. The way some western governments such as France and Germany are psychologically preparing people for war with Russia the whole region could become destablised 😕.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Huringa]

Martin Everson said:
Or just use a broker outside EU to get around EU PRIIP rules. EU PRIIP prevents EU resident retail investors access US ETF's where US ETF's do not provide EU investors with a PRIIP KID. A lot of US ETF's don't want to provide this and EU brokers don't want to hand check every US ETF for a PRIIP KID so just blanket ban restriction to retail investors.

So just hold your brokerage account outside the EU which is wise in today's world in case you need to flee Europe. The way some western governments such as France and Germany are psychologically preparing people for war with Russia the whole region could become destablised 😕.
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Which ones would you personally recommend?

I tried Webull but they wouldn't even let me start the application process. Probably due to EU IP address.

Another option would be Charles Schwab. Interested in which ones you'd recommend. Thank you

Radko said:
Just try to open a professional account with Interactive Brokers, that will allow you to buy US ETFs.

You can also form an LLC in the US and open an account with a US broker in the name of the LLC.
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Thank you so much for the US LLC idea

Nevertheless, currently I don't own any LLC and have no clue about how to open a professional account with IBKR. Do you know if I can still trade options with a regular individual account?

Guess I'm about to find out

Last edited: May 17, 2024

 

[Radko]

Huringa said:
Nevertheless, currently I don't own any LLC and have no clue about how to open a professional account with IBKR. Do you know if I can still trade options with a regular individual account?
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To open a Pro account with IBKR, first open a regular account, then apply for a Pro account (they will give you 3 conditions, you need to check at least 2 of them).

Yes, you can trade options with a regular account.