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Setting up a Forex company in Cyprus By: Andreas Danos Law Firm
Cyprus is the leading country in the EU regulating the Forex market due to its numerous tax advantages, low set up and operational expenses along with the “passport effect” to offer services in all EU countries. It’s a well-known financial and banking centre for international investors, who wanted to take advantage of low taxes, political and economic stability, the flexibility and progressiveness of the common law system, legislation protecting privacy of information, excellent telecommunications and travel infrastructure, ideal geographic location at the crossroads of three continents, and the availability of well-trained professionals to manage their business and financial affairs. All the above make it an ideal location in the EU to set up a Forex company.
Foreign investors interested in investing in Cyprus can set up a forex company, which carries out activities on the local and international trading markets. A forex company provides assistance to other investors, by offering advice on investment opportunities in the forex market.
Forex trading companies are regulated by the Cyprus Securities and Exchange Commission (CySEC), under the CIFs and Investments Firms Law. To set up a Forex company a license is required by CYSEC and the process to obtain such a license involves several steps and conditions.
Share capital requirements vary depending on the type of investment firm and the services to be provided. A company that will only deal with portfolio management and offer investment advice, only requires a minimum share capital of 50.000 Euros. However, companies that operate a multilateral trading facility require a share capital of 730.000 Euros.
Our firm has experience of setting up a Forex Company in Cyprus. We prepare the special memorandum and articles of the company. We apply to the Registrar of Companies, firstly for approval of the company’s name, then for registration of the company, and then the CySEC application is prepared after collecting all necessary information from the shareholders.
After examination and resolution of any issues, CySEC authorises the CIF and grants it a licence. The above procedure, from commencement to final approval by CySEC can be completed in about 5-6 months.