What is the Best Jurisdiction to Incorporate a New Forex Broker?
An important consideration for entrepreneurs and investors who are interested in starting their own forex broker is the jurisdiction in which the new broker is incorporated. This is a decision that should not be taken lightly, since the incorporation of the forex broker in the wrong jurisdiction can be a costly mistake, not just in money but time as well.
What New Forex Brokers Need to Know About Company Incorporation in a Licensed Jurisdiction
When our team is asked about incorporation possibilities in a region that requires a license, we encourage new forex brokers to look somewhere else. First, and foremost, it is not legal to launch a non-licensed forex business in a region that requires a license. As an example, attempting to launch a forex brokerage in Cyprus by simply incorporating a new company would violate the regulations set forth by the Cyprus Securities and Exchange Commission (CYSEC). Secondly, if the local regulator determines that your broker is operating without a forex license, there could be severe penalties to be paid, not to even mention the fact that the broker would be forced to shut down. Finally, it will be incredibly challenging to secure a bank account by taking this approach.
Offshore Considerations for Forex Broker Incorporation
Because it’s not wise to incorporate the business in a jurisdiction with a known regulatory regime, an offshore incorporation is often the ideal choice. However, those new to the forex industry must exercise caution. Because many offshore jurisdictions also issue forex licenses, new brokers who attempt to incorporate in these regions will face the same challenges outlined in the previous section. For this reason, it’s important to work with a consulting firm experienced in the various offshore and local jurisdictions that cater to new forex brokers.
Atomiq Consulting – Banking and Incorporation Services for Forex Brokers
The ideal jurisdiction to choose will depend on several factors: the type of brokerage you are looking to start, the regions you wish to target, and the ultimate goals you’ve set forth for your brokerage. There really isn’t a “one size fits all” approach here since we’ve found that each of our clients and the brokers they launch are truly unique. To determine the best on- or, offshore regions for your new forex broker, don’t hesitate to contact Atomiq Consulting. Our team of knowledgeable and professional experts will be glad to guide you along the proper path to launch your own forex broker.
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