Cyprus Forex license

To do Forex trading (within the global foreign-exchange market) or binary options business in Cyprus, it is necessary that a company acts as an investment firm (Cyprus Investment Firm – CIF). The skilled professional from Prifinance will consult you on its establishment and basic requirements.

Cyprus is known for its dynamic economy and favorable conditions for investors based in the Eastern Mediterranean. Compared to Malta and Ireland, the country has one of the lowest corporate tax rates in the European Union (EU). Cyprus has implemented economic strategies that have accelerated its growth and diversified its economy, leading to its accession to the European Union in 2008. Apart from its reputation as a picturesque vacation destination, the Cyprus forex license is a significant advantage for brokerage companies in Cyprus. With this permit, you can operate throughout Europe without additional licenses or open offices in other countries. Unlike countries like Malta, where several levels of licensing complicate the procedure, this single license covers all types of forex activities.

Cyprus Forex License Advantages

Forex Trading Excellence

  • Early adoption and infrastructure development for forex trading.
  • Recognized as a top jurisdiction for forex activities due to established practices and legal framework.

Licensing Efficiency

  • Tailored to meet strict EU standards while ensuring a streamlined process.
  • Designed to minimize both the financial and temporal costs of obtaining a brokerage license in Cyprus.
  • Clarity and accessibility of application requirements.

Regulatory Balance

Market Access and Cost Optimization

  • Facilitates service provision across the EEA without additional licenses or physical offices.
  • Enables business in wealthier countries while optimizing operational expenses.
  • Enhanced investor protection through rigorous monitoring by home and host country authorities.

Banking and Financial Infrastructure

  • Governed by the Central Bank of Cyprus, meeting high EU banking standards.
  • Wide range of services in multiple languages, focusing on innovation and client needs.
  • High regard for client privacy, with information sharing strictly controlled.

Taxation and Fiscal Advantages

  • A low rate of 12.5% on corporate income is among the lowest in Europe.
  • Various incomes, including dividends and profits from securities, are often tax-exempt.
  • Over 65 treaties minimize tax burdens and facilitate cross-border investment.

Cyprus Forex License and Regulations Overview

Adherence to MiFID II

  1. Enforced in Cyprus since 2018, aligning with EEA-wide MiFID II regulations.
  2. Opting for the foundational MiFID II provisions, Cyprus ensures financial safety with greater operational flexibility compared to stricter jurisdictions like Switzerland or the UK.
  3. Facilitates investor protection, competition, market resilience, and transparency.

Regulatory Measures

  1. Requirement to separate customer and company funds into separate accounts to protect customer assets.
  2. Clients are to be differentiated by forex license Cyprus holders as retail or professional based on their market knowledge, tailoring risk assessment and services accordingly.
  3. A compensation guarantee of up to 20,000 euros for clients from the EEA, including Cyprus, and 1,160 euros for clients from other countries through the Investor Compensation Fund (ICF), subject to membership, providing protection against broker bankruptcy.

Cyprus Forex License Categories

Cyprus offers three primary tiers of forex licenses in Cyprus, regulated by CySEC under Law 87(Ι)/2017, to accommodate different business operations. CySEC’s oversight includes capital adequacy and compliance checks, requiring licensees to sustain minimum capital levels.

Basic License

Capital: 50,000 EUR.

Investment advice, order execution, or portfolio management, excluding client funds handling.

Standard License

Capital: 125,000 EUR.

Uses Straight-Through Processing (STP) to route orders to the liquidity pool, allowing holding client funds.

Full License

Capital: 730,000 EUR.

In-house trade processing, offering liquidity and market protection through fixed spreads, permits client funds handling.

Forex License in Cyprus and St. Vincent and the Grenadines

Registering as a Cyprus Investment Firm (CIF) and obtaining approval from CySEC are necessary steps when starting a Forex business. The process involves variable capital requirements depending on the scope of services while adhering to special financial and anti-money laundering regulations.

Considering the option of a forex company in Saint Vincent and the Grenadines (SVG), you can register as an international business company (IBC) or a limited liability company (LLC). It is necessary to comply with the anti-money laundering and counter-terrorist financing (AML/CFT) policy, while the registration procedure is relatively quick and the applicant receives tax benefits.

Initiating a Forex Company in Cyprus

Among the most important requirements for participating in the financial market of Cyprus is establishing a Cyprus Investment Company (CIF) and obtaining a permit from the Cyprus Securities and Exchange Commission (CySEC).

In addition to providing various investment services, CIFs are tailored to trade on the Forex market.

Exclusions and Legal Framework

  1. CIF designation is distinct from banks, insurance, and investment funds, each regulated by unique laws.
  2. Governed by the Investment Services Act of 2007, CIFs are authorized for a variety of financial transactions involving securities, monetary instruments, derivatives, and more.

CIF Competencies

  • Engaging in securities and monetary instrument trading.
  • Transactions involving enterprise ownership.
  • Execution of financial contracts including shares, currencies, and derivatives.

Banking and Registration for a Cyprus Forex License

Forex Firm Registration

The journey starts with the CIF registration and licensing, which is approximately four months.

Banking Requirements

  • Opening a bank account is a prerequisite for placing the company’s authorized capital, which is crucial in applying for a brokerage license in Cyprus with CySEC.
  • The capital requirement varies from 50,000 to 725,000 euros, depending on the services to be provided.
  • A certificate issued by a bank confirming the existence of a deposit is required to apply to CySEC.
  • The deposited funds are frozen for the entire license duration as a guarantee of financial stability.

Cyprus Forex License Application Documentation

Obtaining a broker license Forex Cyprus requires coordination with the Cyprus Securities and Exchange Commission (CySEC), the regulatory authority overseeing financial licensing.

Required Documents

  1. Organizational structure report.
  2. Comprehensive business plan.
  3. Corporate procedures manual.
  4. Anti-money laundering and risk control manual.
  5. Financial forecast for three years.
  6. Shareholder and director profiles, including criminal record and bankruptcy certificates.

Staffing Prerequisites

CySEC-approved Personnel

  • Four directors, including a CEO.
  • Risk management officer.
  • Compliance officer.
  • Internal and external auditors.

Management and Operational Standards

CySEC mandates several guidelines for a brokerage’s management structure and operational protocols:

  • Board of Directors: At least four qualified members with verified reputations.
  • Ensuring client interest protection.
  • Dedicated department for operational risk minimization.
  • Mechanisms for internal control.
  • Universal procedure for verifying all clients.
  • Adequate protection for client information.

Cyprus Forex License Application Process

It takes up to 6 months to obtain a forex license in Cyprus. If an incomplete or inaccurate application is submitted, the process can be extended up to 10 months.

The amount of the basic fee is 3000 euros. To potentially reduce the waiting time to 3-4 months, there are additional costs for each service and the possibility to speed up the process for 25,000 euros.

Application Steps

  1. Preparation
  • Perform KYC for directors and shareholders.
  • Compile necessary documents, a process that may take around two months.
  1. Submission
  • File with CySEC.

Necessary Documentation

  1. Completed CySEC form.
  2. Information on company leadership and major shareholders.
  3. Incorporation documents and proof of Cyprus office.
  4. Organizational and group structure.
  5. Internal procedures manual.
  6. Three-year plan and AML/KYC guides.

Individual Requirements for Key Personnel

  • Notarized passport copy.
  • Address proof.
  • CV highlighting financial sector experience.
  • Educational proofs in finance.
  • Clean criminal record and financial standing certificates.
  • Personal questionnaire.


What do you need to apply for a Cyprus Forex license?

For a Cyprus Forex license, applicants need financial education or relevant experience, plus a director, a secretary, and a registered office in Cyprus.

What are the banking prerequisites for Cyprus Forex licensing?

Holders of a Forex license Cyprus must open bank accounts post-registration to hold authorized capital, ranging from EUR 50,000 to EUR 725,000, which is frozen for the license period.

What’s the purpose of CIFs in Cyprus?

CIFs, requiring CySEC approval, offer investment services, including Forex. They’re integral to Cyprus’s financial sector, with a four-month setup process.

How do you establish a CIF?

To form a CIF, appoint at least four directors (three must be Cyprus residents), staff your Cyprus office with approved personnel, and secure a local bank account with the necessary capital.

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