How to start a Forex business

Before starting a brokerage business, it is necessary to determine the jurisdiction of the desired country. It is necessary to pay attention to the registration conditions, advantages of doing business, financial aspects, laws, taxation, and the time required to open a firm, which can vary depending on the chosen region. It is very important to study the international norms and legal rules to be followed.

The Forex market is growing every day and licenses are being issued in a more competitive and favorable environment. There is no need for your physical address to coincide with your place of registration.

You will need a license to legally operate your business. Before approaching the regulator, you need to consider the following factors:

  • Optimal budget, which the company is ready to allocate. Registration costs vary greatly from jurisdiction to jurisdiction.
  • The availability of the desired bank to open a corporate account
  • The country in which you plan to conduct your business. The chosen offshore zone must have a reliable legal system, transparent economic background, and stable currency.
  • Optimal registration time for your company. Depending on the country, issuance time can take from 2 weeks to a year.
  • Tax specifics.

Popular jurisdictions


Obtaining a Forex license in SVG is a popular choice for many due to its streamlined regulatory process and favorable conditions. The jurisdiction is known for its competitive advantages, including relatively low capital requirements, straightforward application procedures, and a business-friendly environment.

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Obtaining a Forex license in Mauritius is an attractive option for businesses seeking a stable and well-regulated environment for their operations. Additionally, Mauritius offers favorable tax conditions, a strong financial services sector, and access to a network of double taxation treaties, making it a popular choice for Forex brokers looking to establish a reputable presence in the region.

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Obtaining a Forex license in Vanuatu is a popular choice among Forex brokers due to the jurisdiction’s simplified regulatory process and cost-effectiveness. However, it’s essential to note that the regulatory framework in Vanuatu is considered less stringent compared to some other jurisdictions, which may be a factor for consideration in the decision-making process.

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Offshore jurisdictions for obtaining a Forex Broker License

The Forex License registration procedure and conditions of the activity are different in the legislation of different states. Each of them has several rules, and laws regulating the foreign exchange market, and legal requirements for brokers and the foreign exchange market. The most popular jurisdictions for a broker are in developed countries, e.g. the USA, the UK. Such licenses increase the reputation and trust of traders. However, they require large capital. Other alternatives are more budget-friendly. For example, Vanuatu, Seychelles, or St. Vincent and the Grenadines. Based on many factors such as time of registration, cost, and reputation of the jurisdiction, licenses are divided into different categories:

  • Prime Category A (first level). One of the most prestigious and universal licenses in the world, which is issued by the regulator National Futures Association, NFA USA, and the Financial Markets Authority in Switzerland. Regulators of these countries are the most demanding, and the company must have a large capital. To get a license, you need capital of $20 million, register a physical office address, prepare a large package of certified documents, and pass exams.
  • Universal B (second level). Jurisdiction of the United Kingdom (regulated by the FCA) and Australia (regulated by the ASIC). These countries have more lenient reporting requirements, capital, and attestation packages. Registration requires the physical presence of company owners and key employees, and the cost of the procedure is $35,000-50,000. Start-up capital from $100,000, and if transactions are made “in-house”, it is necessary to have not less than $1 million in cash.
  • In-demand C (third tier) jurisdictions. Includes New Zealand (FSP regulator), Malta (MFSA regulator), and Cyprus (CySEC regulator) which provide a high degree of protection for Forex brokers’ clients. To approve a licensed operation, you need a physical office in the state, a start-up capital of $30,000, and an account with a European bank. This jurisdiction has a low level of taxation and reporting, and the time to obtain it takes about 6 months.
  • Level 4 (D). Representatives of the countries where you can get a license: Vanuatu, Cape Verde, Belize, and BVI. The accreditation process is much faster and easier than in other categories (only 1-3 months). In addition, taxation is at a minimum level. The main conditions: are capital from $ 250,000, a physical office in the state of the regulator, the experience of the owner in the financial sector, and every year the brokerage firm must pay a fee of $ 25,000.

Regulation of offshore activities of forex brokers

The work of a broker is monitored by the regulator. This may be the local government or representatives of the independent financial commission. Its main task is to prevent the circumstances when the forex broker does not fulfill its obligations to the traders and provides them with legal protection.

The main duties of the regulator regarding forex brokers:

  • Checking for compliance with licensing rules
  • Regulation of compliance with these rules during operation
  • Cancellation of the license in case of violation of the rules

Business models in the Forex market

  • Market Maker Model.
  • The company performs transactions for clients, makes a profit from commissions, and provides liquidity in the market. Thus, it assumes possible risks during trading.

  • Agent model.
  • The company acts as an intermediary, accepts orders from traders, and sends them to liquidity providers.

  • Hybrid model.
  • It combines the activity of an agent model and a market maker.

The stages of obtaining a Forex broker license

  • Stage 1

Company registration in the chosen jurisdiction (FX broker can choose the form of the business, such as IBC, LTD, LLC, LLP).

  • Gathering necessary documents to initiate the process.
  • Signing an agreement to lease/purchase an office and provide the necessary equipment.
  • Registration of power of attorney.
  • Conducting a notarial deed to register the company.
  • Entry of the company’s data into the register.
  • Stage 2

Opening a corporate account with a bank.

Conducting preliminary negotiations with the payment institution and guiding the client through the whole process of opening an account.

  • Stage 3

Drafting a business plan.

  • Stage 4

Preparing procedural rules.

Development of AML/KYC Compliance policies adapted to the company’s forex operations. Hiring and training of AML officers of the company and adaptation of their skills to the company’s operations. Instructing the officer in the preparation and filing of reports to regulatory authorities.

  • Stage 5

Collection of documents from the client’s side necessary to initiate the process Sworn translation of legal and corporate documents certified by a notary.

  • Stage 6

Applying for a license

  • Full package of notarized corporate documents.
  • Collection of additional documentation as required by the regulator.
  • Conducting negotiations with the regulator.
  • Compliance with its requirements.
  • Stage 7

Review of the application and obtaining results (time depends on the jurisdiction, about 3-6 months)

Choice of business model

Agency model

  • Profit from the total volume of transactions, which does not depend on the client’s earnings.
  • Stable income in a period of low volatility.
  • All transactions are automatically transferred to the bank account.
  • The company sets the cost of supply and demand on the platform and displays them publicly.

Market maker model

  • Profit from client losses.
  • A direct link to the volume of trade.
  • The company is a party to the transaction.
  • The company acts as an intermediary.

Company registration

To operate a company as a legal entity, you must register it in the jurisdiction of the selected country in which you want to be licensed. Corporate structures and rules may vary depending on the legal situation of the selected state.

At the registration stage, you need to open and register an office, appoint a director and shareholders, determine the available capital, and pay the state fee. Setting up a company, registering a bank account, and collecting the necessary documents may take more time and you should take this into account.

Necessary documents for company registration:

  • extract from the commercial register;
  • proof of ownership (passport and international passport);
  • proof of address (registration or receipt of payment);
  • articles of Association and a short description of the business;
  • trust deed;
  • articles of association.

Please note that the documents must be notarized with a sworn translation into English or the official language of the country in which you are registering the company.


Before starting the activity, it is necessary to apply for licensing of a Forex company. First of all, you need to apply with all the necessary documentation to the regulatory body of the jurisdiction of the selected country. The process of obtaining may differ, but you will need to do the basic steps:

  1. Pay the fee
  2. Hand over identification documents
  3. Document your legal address
  4. Provide documents excluding criminal record
  5. Apply for a license
  6. Set up a payment system for online payments and open current accounts.

Reporting and license renewal

  • Forex brokers have to submit company reports to the regulator, which also has the power to conduct unannounced financial audits.
  • In case of violations, non-payment of state fees, or discontinuation of services for more than six months, the license can be revoked
  • According to the chosen jurisdiction, the company must pay the state fee for the renewal of the Forex license, pay annual fees, and report on profitability and taxes, at least once a year.

Why it’s worth applying for a forex broker license with us

After studying the article, you can try to register a company on your own and get a license for legitimate brokerage activities. But you should keep in mind that it can take a lot of time and in case you choose the wrong jurisdiction it can lead to expensive mistakes and loss of most of your capital.

Obtaining a Forex license without the help of professionals is difficult in any country. It is better to turn to the help of experienced professionals to get a guaranteed result, thereby saving money and time.

G&S will take care of all the legal, organizational and bureaucratic work for the license application. We provide comprehensive services from gathering documents to applying for a license, allowing clients to plan and prioritize their chosen strategy in a very short time and with limited resources. We evaluate the client’s business plan, budget, documentation, and target audience. When selecting a jurisdiction option, take into account the individual circumstances of the company.

Our specialists will help to choose the best option for the offshore zone with comfortable conditions and loyal taxation, taking into account the wishes of the client.

When ordering the service of registering a company and obtaining a Forex license in G&S, clients:

  • save time and budget;
  • minimize risks and mistakes to zero;
  • keep confidentiality;
  • can ask for advice at any stage of the process;
  • get a guaranteed result.

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