Get duly and Properly Licensed
Before you start as a Forex Broker
Forex market has lately gained great popularity. Some of the main reasons for its growth are:
– currency investment has become more accessible for retail traders;
– the currency market is more dynamic than the stock market (bigger opportunities, faster order execution);
– the regulatory environment has become friendlier;
– people have developed a greater interest in private investment.
The number of brokers offering their services has also grown considerably. The variety of financial instruments has become greater and greater. Nowadays on the market you can find currency pairs, indices, commodities, CFD, binary options, and other leveraged instruments.
Many startups and entrepreneurs are drawn to the Forex industry and in particular, show interest in opening an online Forex brokerage, which, in most locations, requires a Forex Broker License or Securities Dealers License. The opportunities for business in the Forex market are vast.
The foreign exchange (Forex) market is the world’s largest and most liquid financial markets. It has a daily trading volume of around $6.6 trillion. This makes it even bigger than the leading stock markets such as FTSE and NASDAQ. In addition to this, some 9.6 million people trade Forex online regularly, that’s one in every 781 people on earth.
Volatility in the world’s markets has made millions of new traders sign up to online platforms. Some estimates state that trading activity has increased by as much as 300% during 2020 – a previously unprecedented increase. It seems unlikely that all these new users will stop trading in the future. Rather, the number is expected to keep increasing while retaining a high percentage of traders.
You may be one of the 9.6 million people that trade in Forex, but what about going a step further? In this section, we’ll look at how to start a Forex business and how to acquire a Forex broker license. Starting a Forex business isn’t easy but with the right help, it can be achieved.
First, you need to get ready to make a lot of decisions and choices. You should also be aware of some of the risks and obstacles involved. Each step of this process will ultimately impact whether you are successful or not in your Forex business.
The first decision you’ll make is by far the most important, and that is where you will base your operations. Pick a jurisdiction where Forex activities are legal and regulated, that suits your budget, timeline, and tax optimization objectives. If you rush and pick the wrong jurisdiction, you can end up making some very costly mistakes. This is not a decision that should be taken lightly.
Atrium Legal Lab can match you with the right location for your offshore Forex license. Take advantage of our extensive experience in the offshore business, licensing, and Forex to pick the most suitable option. We’ll evaluate your business plan including budget, target audience, and individual circumstances. Then we’ll suggest the best option for where you should incorporate and where you should apply for a Forex broker license.
For a Forex Broker License?
Offshore jurisdictions offer a range of benefits that you don’t get with onshore. Each jurisdiction differs with the benefits but here are some “across the board” plus points to going offshore.
Licensing processes in offshore jurisdictions tend to be more straightforward and less paperwork heavy than onshore jurisdictions.
Acquiring a Forex broker license in an offshore jurisdiction is often quicker and more cost-effective.
A quicker licensing process means fewer costs incurred. You can get set up and be profitable in a shorter period.
There are also lower capital requirements when you incorporate and start the licensing process. This leaves more cash to invest in other areas of the Forex business.
Many offshore jurisdictions have favourable tax regimens. In some cases, there are zero taxes payable on revenue generated by the Forex business. Be sure to discuss tax-optimization with Atrium Legal Lab before you pick a jurisdiction.
There are cases were operating in an offshore jurisdiction can provide greater levels of privacy for the beneficial owners.
You can enjoy greater security for your business by incorporating your Forex broker offshore. This puts it out of the reach of creditors and lawsuits.
Which benefits apply to you will depend on your circumstances. To find out more, contact Atrium Legal Lab today!
So, what are the prime jurisdictions for offshore Forex licenses? Based on our two decades (and counting) of experience, the ideal and proposed offshore jurisdictions to get a Forex license are:
Labuan – Mauritius – Seychelles – Vanuatu
Which of these is the best fit for you will depend on factors including your business goals, what kind of brokerage you want to run, where your clients are located, your budget, timeframes, tax, reporting obligations, compliance, and the ease of conducting business from within that jurisdiction. There is no such thing as “one-size-fits-all”.
You also need to be aware of whether the jurisdiction you choose requires licensing for Forex activities. To make sure you are in line with local laws, it’s vital you partner with a professional like Atrium Legal Lab who can make sure you are taking the correct steps.
We are currently carrying out these forex brokerage licensing services both in Labuan, Mauritius, Seychelles and Vanuatu.
In reply to your request and interest for your registration as a Securities Dealer Broker, we are pleased to provide you all relevant information, requirements, timings and fees.
Should you have any question, please do not hesitate to contact us again.
We shall be very pleased to help and assist you on your application.
