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The establishment of an overseas corporation

 

To do the Forex business, we first have to choose a country to build a corporation.
 

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Considerations

There are many considerations at this time.
To summarize a few things to consider:
 

1. Whether it is easy or difficult to obtain a Forex license
2. Minimum capital requirements required
3. Annual Company (including license) Maintenance Costs – Office, Human Resources, Administrative Costs, Other
4. Is it easy to open an account in an offshore bank?
5. Image
6. Other things, etc.
 

Regulations

There must be
In addition, as regulations on FX projects are gradually tightened by country, the preferred countries should also be aware that their preferred countries change over time, and should be selected according to the nature of FX projects they pursue at the time of establishment.
 

If you look at the countries where forex brokers are established and key benefits that have been mentioned a lot recently,
 

Categories of foreign exchange licenses

   

Level A Forex jurisdiction

 

  United States (CFTC, NFA – Regulators)
  Japan (FSA Japan – Regulatory Agency)
   

  - $20 million in freely accessible capital (not including customer deposits).

  - Very strict reporting requirements and customer complaints to regulators that reflect strong     responses from regulators..

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Level B Forex jurisdiction

 

  UK (FCA – Regulators)
  Australia (ASIC – Regulators)

 

  - Less stringent reporting requirements

  - License acquisition costs approximately $50,00-$70,000.

  - You need an actual office.

  -$1,000,000 in capital is required (non-customer funding).

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Level C Forex jurisdiction

A certain level of protection for Forx company customers.
 

  Cyprus (CySEC – Regulators)

  Malta (MFSA – Regulators)

  New Zealand (FSP – Regulator)

 

  Malaysia Labuan (IBFC - Regulator)
  

  • A local office is required.

  • There is a low level of reporting and the taxes are quite reasonable.

  • $30,000 accessible capital is needed, which varies by license type.

  • The price to obtain the license is about $35,000-50,000 for legal services

  • Takes about six months once the documentation is provided to the government before the license is granted.

  • Opening a bank account is easier than some of the jurisdictions below.

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Level D Forex Countries 

 

  Belize the most favourable (FSC– the regulatory body)

  BVI (FSC– the regulatory body)

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  • These countries do have regulations and license requirements, so you will have a license to show prospective clients and post on your website to gives clients a level of comfort.

  • Licensing process takes about 3-4 months,

  • The whole process is typically $20,000-$30,000.

  • Deposit a minimum of $125,000 in your corporate account,  you will have access to the money.

  • With license it is much easier to open a corporate bank account.

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Level E Forex Jurisdictions

(95% of Forex companies start without licenses)

 

  Nevis

  Seychelles

  St. Vincent or other offshore jurisdiction

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  • Jurisdictions where Forex licenses not required.

  • The advantages are speed and low cost.

  • The disadvantage is that, without a license it is difficult to open a bank account but possible.

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 We expect (actual) regulatory / formal financial services licenses to become increasingly popular in the retail Forex industry. Overpopulation and the sophistication of existing regulatory brokers make it increasingly difficult for brokers to gain market share. We expect that most unlicensed foreign exchange brokers will eventually close down.
 

Please contact Lion Consulting at any time for free consultation on establishing a company or acquiring a company's forex license.

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