First-rate unlicensed brokers and the advantages of working without license

In the present article, the UTIP Technologies specialists told about the advantages of working without license for forex brokers, common non-regulated jurisdictions and the list of brokers who are ready to work without license.

The advantages of unlicensed work for Forex broker

Low corporation registration fee

Corporation registration fee includes the license cost. The license cost depends on the place the jurisdiction is acquired. For example, Vanuatu or the British Virgin Islands license will cost several tens of thousands of dollars, whereas the USA license will cost under $20,000,000.

No need to visit the office for getting the company registered. The company registration is completely online. No expenses on visiting the country of registration, running the office and staff.

Simple procedure for opening a company: The only thing required is to provide a minimum package of documents, the whole process will take you up to a month.

Registering a company without license:

A licensed company registration is roughly the same, but the applicant company has to be in compliance with jurisdiction statements. For instance, here are the requirements for obtaining a Cyprus license:

• The investment company headquarter should be located in Cyprus. Core business has to be running in Cyprus.
• The company paid the required fee in the Central Bank of Cyprus. The amount depends on the range of the services provided by the company and on the core business. Membership fee for the Association of International Investment Firms of Cyprus (ACIIF) has to be paid;
• The balance guarantee is also included in the package of documents to get a brokerage license in Cyprus.
• The company’s human resources should hire a specialist majored in anti-fraud and money laundering (Compliaence officer), risk manager, internal auditor. Also, the company should have a Board of Directors, a secretary, an accountant, heads of brokerage, financial and IT departments, traders. It is allowed to combine some job positions, qualification requirements are applied to those who occupy the director’s post.
• The company’s business plan;
• Three-year accounting budget;
• The company should prepare a Policy on anti-fraud and money laundering as well as a KYC (“Know your Customer”) policy;
• Staffing table;
• The police clearance certificates of each employee;
• Information about the absence of bankruptcy status for each employee of the company.
• The person has opened a bank account without withdrawal right for the license period. CySEC must be sure that you own equity. The equity depending on the core business is calculated as follows: If you are an investment analyst — 50 thousand EUR; If you are a broker-agent — 125 thousand EUR; If you are a liquidity provider (market maker) — 725 thousand EUR.

If at least one statement is not fulfilled, the company is rejected in receiving a license from CySEC. The Cyprus Securities and Exchange Commission is obliged to make its decision within 6 months after receiving the application. Overall it takes 4 months.

Common non-regulated jurisdictions

Saint Vincent and the Grenadines (SVG) is an island state in the Caribbean Sea. Marshall Islands (MI), located in the Pacific Ocean.

What brokers can work without a license

Despite the fact that it is much easier and more affordable to open unlicensed business, this method is widespread amongst both beginners and already reputable brokers. The table below shows a list of the largest unlicensed brokers and their place of registration.

The information in the table is taken from the official websites of these companies.

Our experience in this domain makes it possible to confidently assert that the list of brokers with the company on SVG or, for example, MI, is much wider and also includes plenty of small and medium-sized brokers.

Once again, about the non-regulated jurisdictions advantages

• low registration fee;
• short terms;
• favorable terms of extension;
• absence of taxation, provided that you do not provide services to residents of SVG and MI;
• a small package of essential documents for registration (2-4 documents);
• no need to open a headquarter or online office on the territory of the registered country.
• a closed register and non-disclosure of information about the beneficiary, director and shareholder of the company.

If the question of registering a company on SVG or MI is relevant to you, we are pleased to give you more detailed information. Moreover, in addition to registering companies, we provide our own software, develop the website for Forex brokers by meeting their demands. Follow the UTIP website to get more information about these and other special offers.