Forex broker license in Cyprus
Forex broker license in Cyprus. Cyprus financial market offers many advantages:
- low taxes;
- developed legislation;
- many years of experience;
- closeness to the EU;
- no tax for income for foreigners;
- fast and simple procedures of license obtaining.
One of the main financial areas in Cyprus is the forex. If you plan to obtain a brokerage license, you should consider Cyprus as a potential market for business registration.
Who is responsible for licensing?
There is a specific body that controls the market and licenses obtaining – the Cyprus Securities and Exchange Commission (CySEC). It was established 8 years ago and provided significant changes in the countries economy. Due to it, Cyprus was always among the pioneers to introduce new financial options, including the binary options.
Forex legislation includes 2 main acts:
- Markets in Financial Instruments Directive of 2004 (MIFID),
- Cyprus Investment Services and Activities and Regulated Markets Law of 2007.
Before submitting documents you need to make sure that all of the requirements are met. Otherwise, you will lose the chance to receive a license. Here is a short check-list:
- registered office in Cyprus;
- business plan with the main activity in Cyprus;
- financial plan for 3 years;
- license payment;
- opened bank account with funds on it – you need to submit a document from a bank that states the availability of the account;
- hired employees – at least one person must be responsible for the antitrust and competitive business, 2 traders, 1 risk manager, legal advisers and the board of directors with relevant experience in forex. Also, you need an auditor inside the company. The option of cooperation with an independent consulting firm is also possible.
- personal information about owners and top management.
Licenses are obtained only by those companies that have established a transparent reporting process and who have the technical and legal capabilities to store customer data. So be prepared to provide information on these items.
The cost and duration of the procedure
After receiving your documents the CySEC takes 6 months for its consideration. All the documents are carefully checked. But usually the decision appears earlier – in 4-5 months after submission.
The cost of the license depends on the number of services you plan to provide.
What are the first steps in the license obtaining?
First of all, you need to register a company in Cyprus. The certificates of registration are also provided by the CySec.
Before company registration, you need to familiarize yourself with the Investment Services and Activities Law and the Regulated Markets Act of 2007. According to this document, brokerage activity is considered as an investment activity.
The next stage is the opening of the bank account. On this account, you must put the share capital and freeze it until the decision on the license.
Depending on the number and specificity of services, the size of the authorized capital varies from 80 thousand euros to 1 million euros.
After you transfer the capital to the account, ask the bank to give you a written confirmation of the availability of funds. Without this document the positive decision on the license is impossible.
Eternity Law international will gladly help you with forex broker license, and our specialists will answer all your questions. Take advantage of our many years of practical experience – save your time and your money.
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