We receive many inquiries about a cost-effective way to license forex brokerage services. If looking for the lowest possible entry point for an offshore brokerage licence with full custodial capabilities, no local director or local physical office requirements Belize and Vanuatu are really the only two options that fit these criteria that we are aware of.
Other former popular entry point options like BVI and Mauritius have increased their requirements and costs. Belize offers one of the most inexpensive regulated brokerage options available anywhere in the world for setting up a forex brokerage firm. Other relatively low cost options include BVI and Mauritius with lower paid-in capital requirements but higher regulatory hurdles to overcome.
Only Vanuatu has a lower cost and the added advantage of no paid-in capital requirement plus the licence also includes anything to do with securities and investments. Belize, unlike Vanuatu requires a separate licence for securities and derivatives trading.
The New Zealand FSP also was a popular option but since January 2015 the New Zealand FMA has been scrutinising all FSP applications for forex trading and delaying decisions without providing any real reasons. The way around that problem is to first get licenced in Vanuatu or Belize and then the NZ FMA review process will be much easier and faster.
New Zealand still has no special licencing requirements for forex trading nor any paid-in capital requirement.
What is a Belize Financial & Forex Licence?
A Belize Forex Licence is an authorization granted by Belize’s financial regulatory authority—typically the International Financial Services Commission (IFSC)—that allows a company to legally operate in the foreign exchange (forex) trading market. This licence is designed for firms that want to offer forex trading services, including brokerage services, dealing desk operations, or other related trading activities. Here are some key aspects:
Advantages
Belize foreign exchange trading licence service allows one to:
- Operate as a forex brokerage firm
- Provide an online trading platform for your clients to make their own trades
- Provide related services for your clients to open their own trading accounts with your firm
- Provide convenient access to their accounts via debit cards
- Provide additional full-service brokerage options
- Provide managed forex trading options
- Trading in a financial commodity including derivatives, futures, stocks, shares
- Set up a brokerage or consultancy to provide advisory services to clients in a range of financial services
A Belize License can also be used for things such as:
- Payment Processing services
- Money lending
- Money Brokering and exchange
How to Get a Licence?
Please note that prior to incorporating a company seeking to provide services in Foreign Exchange, the following procedures are required:
- Formulation of the Memorandum and Articles of Association, with special provisions on the affairs of brokerage, with the required share capital
- In the case of Belize the company will be asked to deposit it’s full capitalization ($100,000 required) in a local bank account at the beginning of the application process.
- These funds must stay in one's account for the full duration of the licence and the bank will be required to issue a Blocked Funds Letter confirming this. Vanuatu has no paid in capital requirement other than a $2,000 government fee that is paid along with the professional fees.
- Full due diligence on each director and beneficial owner of the company will also be required in both jurisdictions as part of the application process. Other than the usual reference letters and CV's, police records will be required along with a business plan and AML compliance manual.
For more: How to Get A Forex License
Licence Details
No local directors are required and no physical operation or employees are required in Belize or Vanuatu to operate such a licensed company. Licence application process currently is taking 6 to 8 months in total including the initial time of setting up the company and bank account.
Vanuatu's process is much faster at less than 2 months in part because there is no requirement for the set up of a local bank account, since there is no paid-in capital to deposit. Also the application review process is more accelerated. The only difference is that Vanuatu is now requiring the appointment of a 3rd party as an AML Compliance Officer. This is somebody that you can appoint or we can furnish this person locally if needed.
If you would like more information please see our Vanuatu Security Dealers License
How Can Offshore Protection Help You?
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Offshore Protection is a boutique offshore consultancy that specailizes in asset protection solutions creating bespoke global strategies using offshore companies, trusts, and second citizenships so you can confidently protect what matters most.
We help you every step of the way, from start to finish with a global team of dedicated lawyers and consultants. Contact us to see how we can help you.
