COREDO > Licensing > Forex Broker Licence

Forex Broker Licence

What Is a Forex Broker Licence?

Forex Broker Licence — authorization to provide foreign exchange trading and brokerage services in the EU under MiFID II. It allows a company to operate as an investment firm and access FX markets (spot FX, currency instruments, margin trading) across the entire EEA.

COREDO supports the acquisition of forex broker licences and market entry into regulated European FX markets.

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Who Needs a Forex Broker Licence

A Forex Broker Licence is required by any business that intends to offer regulated FX trading or currency brokerage services to clients in the EU/EEA. It is most relevant for:

Retail forex brokers

building platforms that allow individual traders to trade currency pairs with or without leverage

Fintech startups

developing multi-currency wallets or FX conversion features with proprietary execution

Institutional trading desks

seeking European authorization to manage client FX orders and provide market making

Crypto-to-fiat platforms

that include spot FX conversion as part of their payment or settlement workflow

Investment managers

whose strategies involve active currency hedging on behalf of client portfolios

If your business model involves executing foreign exchange orders for clients, managing currency risk on their behalf, or providing currency-linked investment advice, a Forex Broker Licence under MiFID II is the required authorization.

Our Currency Trading Licensing Services

COREDO provides a full range of broker licensing services:

Legal consultation and document preparation

Investment strategy development for regulators

Company restructuring to meet MiFID II requirements

Coordination with financial regulators (CySEC, CNMV, FCA, CNB, and others)

Organization of bank accounts for capital placement

Implementation of AML/CFT and KYC procedures

Technical support after licence receipt

Partner with us at each licensing stage, and we deliver minimal timelines with maximum results.

Licence Capabilities for Broker Companies

Permission to conduct broker business in foreign currencies grants companies these authorities:

Brokerage services

execute foreign currency buy-sell operations (spot, forwards, swaps) on organized and over-the-counter trading platforms

Portfolio management and consulting

manage portfolios with currency assets and provide investment consulting

Margin lending

provide margin credit for currency trading within MiFID II limits

Investment order execution

manage client orders, market making, and execution operations using own capital

Market analytics

publish investment ideas, forecasts, and analytical reports on currency markets

EEA expansion

MiFID II passporting enables service provision across all European Economic Area countries

This licence differs significantly from Banking Licences, which focus on deposit acceptance. Yet it aligns closely with Securities Trader Licence, as both enable professional financial market operations.

Requirements for Forex Broker Licence

To obtain permission to conduct broker business in foreign currencies, meet strict MiFID II requirements:

Capital Requirements:

Minimum own capital of EUR 730,000 for an investment firm under Directive 2014/65/EU and Regulation 575/2013.

Capital must be fully paid and registered with a credit institution within EEA territory.

Competent Management:

Board members, shareholders, and key staff must demonstrate significant professional experience in currency and financial markets, appropriate financial education, and unblemished reputation.

Regulators conduct sanctions list screening (OFAC, EU sanctions) for all officers.

Currency Trading Competence:

Companies must demonstrate proven experience in currency trading, risk management, and knowledge of MiFID II principles.

Compliance with regulatory requirements and investor protection is mandatory.

Risk Management Policies and Procedures:

Develop systems managing credit, market, and liquidity risks.

Systems must include open position limits, portfolio stress tests, and capital adequacy monitoring.

AML/CFT Compliance:

Implement AML controls under Regulation AMLR (2024/1624), including KYC verification for all clients, suspicious transaction monitoring.

Investment Policy and Marketing:

Describe service types provided, investment strategies, client categories, commission models, marketing methods, and permitted currency pairs.

IT Infrastructure and Security:

Maintain reliable trading and accounting systems, client data protection, GDPR and DORA compliance.

How We Work: How We Obtain Permission

The forex broker licensing process includes the following stages. On average, the process takes 2–4 months:

Stage 1: Document Preparation (2–4 weeks)

Prepare registration package: founding documents, owner financial documents, management qualifications, currency strategy description, IT infrastructure, risk management policies, AML/CFT procedures, and business plan.

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Stage 2: Application Submission (1–2 days)

Official application submission to national financial supervision authority (CySEC, CNMV, FCA, CNB, etc.).

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Stage 3: Application Review (1–3 months)

Regulator analyzes management qualifications, investment strategy reliability, and capital adequacy. Risk management systems, owners, and beneficiaries are verified.

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Stage 4: Licence Issuance (several days)

Following a positive decision, the licence is registered in the state registry, and the company gains the right to begin providing broker services.

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Jurisdictions and Licensing Timelines

COREDO provides services for obtaining forex broker permission in the following jurisdictions:

Jurisdiction	Licensing Timeline	Features for Forex Brokers
Czech Republic (CNB)	2–3 months	COREDO local support, experienced MiFID II regulator
Estonia (FSA)	2–4 months	Digital document submission, fast processing, low fees
Lithuania (Bank of Lithuania)	2–4 months	Favorable trading platform regulation, rapid approval
Cyprus (CySEC)	1–3 months	Internationally recognized regulator, HFT and retail forex experience
Malta (MFSA)	2–4 months	EU financial hub, developed broker infrastructure
Poland (PFSA)	3–4 months	Growing market, full investment company support

COREDO Service Cost: from EUR 70,000 for a complete licensing package with MiFID II.

Exact pricing depends on selected jurisdiction, currency instrument types, and required components (own capital management, margin trading). Contact our team for detailed calculation.

Forex Broker Licensing Beyond the EU

Forex brokerage extends far beyond the European Economic Area. For non-EU businesses seeking to operate in major international financial hubs, specialized licensing structures apply.

Singapore (MAS):

Forex activity is regulated by the Monetary Authority of Singapore (MAS) under the Capital Markets Services (CMS) licence. A minimum capital requirement of SGD 1 million applies. The licence covers FX and derivatives trading with strict requirements for cross-border operations, capital adequacy, and risk management.

Switzerland (FINMA):

Forex brokers are licensed by FINMA and must additionally join an SRO for AML supervision. Capital requirements depend on the size and risk profile of the firm. Regulation is based on a national framework, focusing on a risk-based approach rather than EU MiFID II rules.

Dubai and UAE (DFSA/SCA/VARA):

The UAE operates a multi-layer regulatory system: DFSA regulates forex and investment firms in DIFC, SCA oversees mainland operations, and VARA supervises crypto-related FX products and digital derivatives. All structures require licensing, local presence, and AML compliance frameworks.

Canada:

Forex and investment activities are regulated at the provincial level through CSA and CIRO, with mandatory FINTRAC registration as an MSB for AML/CTF compliance. The system combines provincial licensing with federal compliance requirements.

Bridging Global and EU Markets:

Access to the EU and international markets requires a separated corporate structure with an EU MiFID II licence and distinct operational jurisdictions. Segregated AML and compliance frameworks are mandatory, along with a group structure of subsidiaries across regions.

Key Benefits of Currency Trading Permission

Main benefits of currency trading permission include:

Free capital movement

conduct operations across all EEA countries without additional permissions through MiFID II passporting mechanism

Professional status

recognition as investment firm under European standards enhances reputation on international markets

Expanded service range

right to offer consulting, portfolio management, and market making alongside broker services

Client base access

attract retail and professional traders from across the EEA

Expert support

COREDO guidance throughout licensing stages and operations launch

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Financial Licence Comparison Table

Parameter	Forex Broker Licence	Banking Licence	Securities Trader Licence	Investment Activity Licence
Primary Activity	Currency trading, spot FX, forwards, swaps	Deposit acceptance, lending	Securities trading	Portfolio management
Minimum Capital	EUR 730,000	EUR 730,000+	EUR 25,000–125,000	EUR 100,000–500,000
MiFID II Passporting	✓ Yes	✓ Yes	✓ Yes	✓ Yes
Asset Management	Consulting	Full management	Full management	Full management
Typical Timeline	2–4 months	4–6 months	2–4 months	2–4 months
Process Complexity	Medium	High	Medium	Medium

Passporting and EEA Expansion

The key benefit of Forex Broker Licence is the ability to provide broker services across all European Economic Area countries without obtaining separate licences.

The MiFID II passporting mechanism enables companies to:

Expand services to other EEA countries through MiFID II passporting (passive service provision)
Attract trader clients from all EU countries regulated under MiFID II
Open branches and representative offices in other EEA jurisdictions

This makes such a licence especially valuable for ambitious companies planning European currency trading market expansion.

Learn more about other financial licence types in Banking Licences or Securities Trader Licence.

Our Experts

COREDO is a leading European financial licensing consultant with deep expertise in obtaining MiFID II permissions.

Pavel Kos

Head of Legal, brings extensive experience in broker company licensing.

Case Studies

Case 01Fintech Trading Platform in Estonia.

A fintech startup with trader audience sought broker licence for FX and CFD trading platform. COREDO coordinated Estonia licence application including risk management systems, segregated client accounts, and AML/CFT framework. Licence approved in 2.5 months; platform launched live trading with leverage execution and margin call protection systems operational.

Case 02Broker Expansion via Passporting in Czech Republic and Lithuania.

A Cyprus-licensed investment firm sought to expand FX broker services to Czech Republic and Lithuania. COREDO managed MiFID II passporting notifications to ČNB and Bank of Lithuania, prepared required compliance documentation, and ensured capital adequacy compliance across all three jurisdictions. Passporting notifications processed within 3 weeks; firm immediately began client acquisition in both new markets without separate licensing procedures.

Case 03Investment Club to Regulated Broker in Malta.

An informal investment club of professional traders sought transformation into regulated investment firm with margin trading rights in Malta. COREDO prepared complete licensing documentation, governance structure, and client fund handling procedures. MFSA licence issued in 5 months; firm became fully licensed broker with ability to offer leverage trading and client advisory services.

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FAQ

Can a non-EU founder or shareholder apply for an EU Forex Broker Licence?

Yes. Non-EU shareholders can hold stakes in a MiFID II-licensed investment firm, but the applicant entity must be incorporated in the chosen EU/EEA jurisdiction, and all directors and qualifying shareholders are subject to fit-and-proper assessments regardless of nationality. Applicants from high-risk or sanctioned jurisdictions face heightened scrutiny. COREDO assists with structuring compliant ownership and directorship arrangements where needed.

What is the difference between a Forex Broker Licence and a Czech foreign exchange licence?

The Czech National Bank (ČNB) also issues a simplified “foreign exchange” registration under Czech Act No. 219/1995 Coll. (Foreign Exchange Act) for companies performing domestic currency exchange operations. This is a domestic-only, lighter-touch registration (from EUR 6,500) that does not carry MiFID II passporting rights. A full Forex Broker Licence under MiFID II is required for leveraged trading, client order execution, and cross-border EEA services.

Which instruments can I offer clients with a Forex Broker Licence?

Under MiFID II, a licensed forex broker can offer spot forex, currency forwards, swaps, currency futures, contracts for difference (CFDs) on currency pairs, margin trading, and currency strategy consulting. The exact scope depends on the authorisation categories granted — some jurisdictions require separate permission for dealing on own account versus executing client orders.

What are the ongoing obligations after obtaining a Forex Broker Licence?

Once licensed, you must maintain minimum capital continuously, segregate client funds, file periodic prudential reports, submit annual audited accounts, comply with best execution requirements, maintain transaction records for 5 years, conduct annual AML risk assessments, and notify the regulator of material changes to ownership or business model. COREDO provides ongoing compliance monitoring and annual regulatory review services.

Does the Forex Broker Licence cover crypto-to-fiat FX or crypto CFDs?

A MiFID II Forex Broker Licence does not automatically cover crypto asset services. Crypto-to-fiat FX products may fall under MiCA (Markets in Crypto-Assets Regulation, EU 2023/1114) for tokenised instruments, or require a separate CASP licence. If your platform combines traditional FX with crypto operations, COREDO can advise on the appropriate combined licensing structure.

Contact COREDO

Ready to obtain a currency trading broker licence? COREDO provides full support from document preparation through permission receipt and trading platform launch.

Consultation Contacts:

Email: info@coredo.eu Phone: +420 228 886 867 Registered Office: K Cervenemu dvoru 3269/25a, Prague, 130 00, Czech Republic

Fill the request form below, and our specialist will contact you within 24 hours to discuss your situation, evaluate timelines, and calculate your complete Forex Broker Licence licensing package cost.