Obtaining a forex licence in Cyprus can be a time-consuming and costly procedure, but it gives a forex brokerage firm credibility and legitimacy, which can be appealing to clients and investors.
Cyprus is a global financial and Forex trading powerhouse. Cyprus, as an EU member state with strong economic foundations, it boasts an appealing low corporation tax rate, making it a natural choice for enterprises seeking solid commercial opportunities across Europe.
Cyprus is located in the eastern Mediterranean Basin, 44 nautical miles south of Turkey, 64 nautical miles west of Syria, and 150 nautical miles north of the Nile Delta. Its strategic location at the crossroads of Europe, the Middle East, and Africa facilitates travel to those regions.
Cyprus’s current population is 1,260,138, growing 0.69% from 2022.
The official languages of Cyprus are Greek and Turkish. The island is divided into two parts, with the Turkish Cypriots to the north and the Greek Cypriots to the south. Around 2.7% of each also speak Armenian and Arabic, and the majority of these also speak Greek.
Cyprus is a common law jurisdiction, and its court system is adversarial in nature. The vast majority of Cypriot law is based on English common law, the fundamental concepts of which are directly applied by Cyprus courts (section 29, Courts of Justice Law).
The country’s favourable tax regulations are one of the key reasons why forex brokers opt to operate from Cyprus. Cyprus has one of the lowest corporation tax rates in the European Union, at 12.5%.
The Cyprus forex licencing framework is noted for its high standards and stringent rules, which contribute to the safety and security of traders and investors that utilise forex brokerage services in Cyprus.
|Gov. Capital Req.
|EU125,000 / EU730,000
The following are some of the benefits of having a forex licence in Cyprus:
Cyprus is a part of the European Union, and a CySEC forex licence permits businesses to sell their services across the EU, providing them access to a wide market of potential clients.
A CySEC forex licence lends credibility and validity to a forex brokerage firm. CySEC is a renowned regulatory authority, and being licenced by them indicates to clients and investors that the company follows high standards.
Cyprus offers a favourable tax structure, with a corporation tax rate of 12.5% that can benefit forex brokerage firms.
Cyprus’s regulatory environment is efficient and streamlined, allowing businesses to receive a licence in a timely manner.
Cyprus has a strong financial infrastructure, including banking services and access to international markets, which might be advantageous for forex brokerage firms.
Cyprus’s regulatory structure is intended to protect investors, and includes regulations for client fund segregation, negative balance protection, and compensation schemes.
|Timeframe for Approval:
|5 to 9 months
|The Cyprus Securities and Exchange Commission (CySEC)
|Forex, Business, Education, Health Services, Real Estate, Tourism, Agricullure, Energy, Transport
|A Forex broker with a Forex licence in Cyprus has the following corporate structure: general director; a board of two managing directors; at least two certified traders; secretary; CTO; CFO; CRO; MLRO; internal auditor; compliance officer; and the head of the brokerage department.
|Corporate Tax Rate:
|€125,000 being required for a Standard License and €730,000 for a Full License
Corporate tax incentives,
Research and development incentives,
|4 directors, including the managing director
|Only one shareholder (can also be a legal person, no nationality restriction)
|Local Registered Officer:
|Required (3 and more)
You will be allowed to lawfully engage in a variety of activities if you receive a licence. They are as follows:
Services for investment
Conducting business at your expense
Providing securities investment advising services
Orders for various financial instruments are processed.
Except for investment purposes, currency exchange
Credit-based funding issuing
The following actions will be taken in order to receive a licence:
1. Establish international business corporation.
2. Preparation and drafting of shareholder and officer agreements.
3. Preparation and drafting of narrative business plan.
4. Preparation and drafting of current financial statements.
5. Preparation and drafting of 3 years financial projections.
6. Preparation and drafting of personal financial statements for owners.
7. Preparation and submission of application with appropriate regulatory authority
8. Preparation and drafting of responses to regulatory authority
9. Identification and engagement of auditor and forex prime broker.
10. Facilitate opening of bank accounts and payment processors.
11. Preparation and drafting of AML/KYC policies and procedures.
12. Preparation and drafting of client agreements and disclosures.