Forex license in Georgia
Financial companies holding a Georgia Forex license get open access to the European market, operating in a loyal jurisdiction with optimized taxation. Gofaizen & Sherle will provide professional support for easy and fast licensing of your forex company in Georgia.
Until 2018, forex companies could safely operate in the jurisdiction without obtaining a Forex license in Georgia. But since April 11, 2018, the government has introduced new rules and made mandatory licensing requirements for all forex companies. According to the regulation, brokers are not allowed to serve clients and conduct promotional campaigns without authorization from the regulator. Such measures were caused due to many violations and to ensure the rights of clients protection.
Georgia is a rather promising jurisdiction for starting and scaling up in the forex market. Even though most of the population of Georgia does not have high incomes, licensed companies can operate in the European market, opening themselves up to a large number of solvent audiences. In addition, brokers receive tax benefits that reduce the financial burden on the business.
To obtain a license, several standard requirements must be met: proof of authorized capital, local office, impeccable reputation and beneficiaries’ experience, etc.
Advantages of a Forex license in Georgia
Quick timeframes for obtaining a license
Georgia has the shortest processing time in the European Union – only one month. This is far ahead of other countries, such as Malta and Cyprus, where the term of obtaining a license reaches up to a year. Favorable banking terms Georgian banks offer low tariffs (especially compared to European banks) and no mandatory minimum account balance, providing a full range of banking services for foreigners.
Visa-free regime for foreigners
Foreign nationals from more than 90 countries can reside in Georgia for up to one year without a visa, facilitating both short-term travel and long-term stays.
Remote interaction with the state
Georgia facilitates business processes by providing the ability to conduct all important transactions remotely, including filing reports and tax returns.
Ease of doing business
The absence of strict state inspections and a convenient system of interaction with government agencies makes Georgia attractive for entrepreneurs. The government is set up for business development without unnecessary regulatory burdens.
Attractive tax conditions
Brokers and entrepreneurs in Georgia enjoy significant tax benefits, including a low-profit tax of 5% and an exemption from payroll and dividend taxes.
Request more information about the Forex License in Georgia
Requirements for a brokerage company in Georgia
To successfully obtain a Georgia Forex license, a company must meet the following requirements:
- Availability of authorized capital – about 185.000$.
Please note that in SIZ (free zones of Georgia), the requirements for authorized capital are lower and are about 40.000$, with an annual fee of 6000$. If you plan to provide services outside of Georgia, consider opening a company in an NIZ.
- Rent or purchase a local office
- Impeccable reputation of the company director and proof of his experience and competence in the financial field
- Availability of a local representative
- Availability of an accountant to keep accounts and transfer information to the Financial Monitoring Service.
- Compliance with AML rules
- Opening a bank account, according to FATCA
Process and timeline for obtaining a Forex license in Georgia
To be licensed, you must first register your company in Georgia. This process includes the following steps:
- Selecting the type of company: Identifying and selecting the appropriate legal format of the company, such as a limited liability company (LLC) or a joint stock company (JSC).
- Registration of the company name: Selection of a unique company name and its registration in the National Register of Enterprises of Georgia.
- Preparation of corporate documents: Drawing up the necessary package of corporate documents and their subsequent notarization.
- Registration in state registries: The process of registering the company in the Register of Entrepreneurs, obtaining an individual identification number (IIN) and an official extract on the status of the enterprise, as well as tax registration.
If you have correctly completed all the steps and collected a full package of documents – the registration time will take 1-2 days. After receiving an extract from the Registry, you will be able to proceed to the next steps to obtain a Forex license in Georgia:
Step 1 Company Registration
Once the company is incorporated, it is also necessary to register the company with the country’s Revenue Service.
Step 2 Opening a corporate account
You need to open a corporate account in a Georgian bank and deposit the authorized capital into it. This process takes about a week.
Step 3 Rent an office
You need to rent office space for your business in Georgia, which is an important step to strengthen your presence and legitimacy in the country.
Step 4 Collect documents
You need to gather a package of documents, including proof of company registration in Georgia:
- A copy of the beneficiaries’ documents
- Proof of no criminal record
- Financial statements of the applicant for the last six months
- Articles of Association and corporate documents
- Proof of specialized education of key persons
- Information on the source of capital
Step 5 Filing an application
Together with the package of documents, it is necessary to submit the application to the National Bank of Georgia and wait for the regulator’s decision.
When do you need a Forex license in Georgia?
If you provide any of the above services, you will need to open a Forex Broker License to legally operate in the jurisdiction:
- Investment advisory services
- Investment services in securities, as well as their purchase or sale
- Recommendations on investment strategies based on financial market analysis
- Preparation and realization of issuer’s securities
- Receiving and transferring orders from one source to another related to securities
- Management of client’s portfolio
- Deposit services
- Other transactions with financial instruments
Forex Lawyers in Georgia
Position
Senior Associate, Business Development ManagerPhone
+372 5477 0344
Position
Senior Associate, Head of Sales (FX and iGaming)Phone
+372 5300 1858Regulation of Forex license in Georgia
Since April 11, 2018, any company providing forex services is required to be licensed. The main regulator of this sector is the National Bank of Georgia, which performs the functions of control over the financial sector to ensure its stability, transparency, as well as protection of the rights of consumers and investors. As part of its duties, the National Bank of Georgia monitors compliance with the requirements of the Law on Combating Money Laundering and Financing of Terrorism by the organizations specified in this law. This includes verification of compliance with regulations developed both by the Financial Monitoring Service and the National Bank itself, based on the said legislation. Monitoring is conducted using a risk-based approach and includes both on-site and off-site inspections. In addition, the National Bank of Georgia also acts as a banker and financial agent of the state.
Currently, the forex market in Georgia falls under the regulation of the following laws:
- The Law of Georgia “On Securities Market” regulates the relations arising in the securities market, establishing rules for issuers, investors, brokers, and other market participants. This law is aimed at creating transparent and fair trading conditions, as well as protecting the rights of investors.A licensed forex company is authorized to conduct a wide range of operations, including trading in equity interests, securities, and currencies, under Article 23 of the Securities Market Law. This license also allows for the provision of investor advice, market research, investment portfolio management, and brokerage services, including the placement of securities; without it, the provision of brokerage services is prohibited in the country.
- The Law on Licenses and Permits defines the procedures for issuing licenses and permits for various types of activities in Georgia, including financial market participants. The law is aimed at simplifying administrative processes and facilitating business initiatives through a clear and transparent licensing system.According to Article 6 of this law, all companies that provide services for securities transactions, conduct brokerage activities, manage assets, provide deposits, or own a stock exchange are subject to licensing.
- The Tax Code of Georgia regulates taxation in the country, establishing rules and tax rates for individuals and legal entities. The Code covers various types of taxes, including income tax, profit tax, VAT, and others, and provides procedures for their payment and administration.
- The NBG Order “Procedure for Licensing a Brokerage Company…” establishes requirements and procedures for obtaining a license to carry out brokerage activities in Georgia. The document describes the conditions that companies must meet to obtain a license, as well as lists the required documents and steps of the licensing process. This order is aimed at regulating brokerage services, ensuring their quality, and protecting the interests of clients.
- Anti-Money Laundering (AML) laws in Georgia are aimed at preventing the use of the country’s financial system for laundering illegally obtained funds and financing terrorism. The legislation requires organizations to implement internal policies, procedures, and controls to mitigate money laundering and terrorist financing risks and provides for regular staff training on relevant standards and procedures. The National Bank of Georgia plays a key role in supervising and monitoring compliance with these requirements in the financial sector.
Grounds for revocation of Forex License in Georgia
The regulator has the right to suspend or revoke a license in the following cases:
- non-compliance with the regulator’s requirements
- failure to pay the state contribution
- violation of legislation
- violation of business conditions
- ignoring the regulator’s warnings and failure to correct deficiencies
- violation of AML rules
- business liquidation
The National Bank of Georgia shall decide on license revocation within 30 days, after which the license shall be returned to the National Bank within three days.
FAQ about Forex license in Georgia
Is forex trading Legal in Georgia?
Yes, Forex trading is legal in Georgia. The country has regulation of financial markets, including the Forex market, which is carried out by the National Bank of Georgia (NBG). Companies wishing to provide forex brokerage services must obtain a Georgia Forex license.
How do I get a Forex License in Georgia?
To obtain a Georgia forex license it is necessary to fulfill several requirements from the regulator, register a company, open a corporate account, and rent an office in Georgia. Then prepare and submit a package of documents together with an application to the National Bank of Georgia.
How long does it take to obtain a Forex license in Georgia?
The regulator decides to grant the Georgia Forex license within 30 days after receiving all the necessary documents from the applicant.
How much does a Forex license cost in Georgia?
Obtaining a Georgia forex license does not have a fixed cost and varies depending on the type of your company, type of activity, and other factors. With the support of Gofaizen & Sherle specialists, the cost is from (amount).
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