A Forex license allows Forex institutions to operate as regulated and legal foreign exchange brokers in the Forex industry. 

The license also enables a Forex company to do business in the jurisdiction which has issued the license. 

With a Forex license a company can do business in the world’s largest financial market. Foreign exchange is now almost exclusively handled online enabling swift and convenience transactions internationally and in all currencies.


The Internet also enables investors from across the globe and from all backgrounds to participate in currency trading with a Forex broker; all they really need is an Internet connection. The newfound easy accessibility which the Internet has provided explains why Forex trading has expanded and developed so rapidly.

Forex License Basics

businessman pressing button on virtual screens in modern office

Obtaining a Forex license can be a rather lengthily and complicated process. The applicant needs to compile and submit a large amount of legal documents verifying their good standing and outlining in detail their business plan.

Start-up brokers are advised to consult with a professional company to help them select the jurisdiction which best suits their needs and requirements. By consulting with a professional Forex brokers can be assured that they will obtain their license in an efficient and timely manner.

Choosing a Broker Licensing Jurisdiction 

In order to become a licensed, legitimate Forex brokerage company you need to acquire a Forex license. Before doing so you should assess which jurisdiction offers the most favorable terms, regulations and conditions to companies and how this meets your company’s requirements. Prior to making any decision you should consider the following points:

Minimum Capital Requirements: How much does the jurisdiction require as the minimum capital to be deposited in order to obtain a license? The capital requirement is determine by the size of the company and the services they plan to offer.

Processing Time: How long does it take the jurisdiction’s regulatory body to issue a license?

Tax Regulations: What are the jurisdiction’s tax laws?  Would their tax system benefit your company in terms of profits and capital gains?

Technical Requirements: What are the software, technical support, infrastructure and IT facilities available in the jurisdiction? You will need a forex white label and fast Internet platform to run your online Forex business efficiently.

Marketing: Will this jurisdiction meet your marketing needs? Once you have obtained the Forex license and your business is set up and running you will need to market your business and appeal to a large audience in order to generate a substantial clientele.

Obtaining your Forex License

business hand holding credit card with computer. can used for cover page presentation and web banner. e-commerce internet technology concept.

Choosing a jurisdiction which best serves your purpose is perhaps the most important decision when setting up a Forex company. It is important to consider all the above points and to made a careful and calculated decision. Your choice will determine many aspects of your brokerage business. For example if you register your Forex company in Vanuatu you will be required to abide by all the regulations of the Vanuatu Financial Services Commission.

Choosing a jurisdiction means choosing the regulating body which will monitor your company and this in turn determines the credibility of your company. Clients will look for a company which is registered in a jurisdiction where there is ethical and strict regulation of brokerages. Forex Regulatory Authorities ensure that companies are not involved in money laundering activities or fraudulent dealings.

Once you have selected a jurisdiction where you want to register your Forex company the next step is to submit all the relevant documents required by the jurisdiction regulations. In addition to submitting the relevant legal documents Forex brokers applying for a license are required to take a “fit and proper test.” A “fit and proper test” is a term referring to a required legal procedure/examination/investigation conducted by the jurisdiction’s regulatory body. The purpose is to determine whether the key personnel of the applying business have the necessary qualifications, experience and knowledge to run a Forex brokerage firm. To be approved by the authorities you are assessed according to a range of criteria. For example the test checks professional efficiency and financial history. Forex brokers will not be permitted to set up a business in the jurisdiction and will not be issued with a license if they do not meet the criteria of the fit and proper test.