One of the most popular destinations for offshore regulation is Vanuatu. Over the past couple of years, the Pacific island’s regulatory framework has become somewhat if a safe-haven for the forex and CFDs brokerage industry at a time of some critical changes to the sector.
Last year, the ESMA’s changes to the retail brokerage space in Europe caused a stir of new applications with offshore regulators. As a result, a growing part of the industry has been moving to other jurisdictions in an effort to .
The Vanuatu Financial Services Commission (VFSC) did make one big change over the past couple of years – it hiked the deposit companies had to park with the regulator to $50,000. That said, up until now, the island nation’s regulation wasn’t materially different than .
Several Changes in 2019
The company’s team, which helps compliance of many brokerages and liquidity providers in the industry shared that one of the key new requirements is to have a local presence in Vanuatu. Aside from that, the set of instruments that brokers can provide has also been changed with crypto offerings taking a hit.
The requirement for a local office is doubled with the need for a local director. The changes are aimed at making the regulatory framework more robust at a time when an increasing number of brokers are taking advantage of looser offshore regulations.
Sources with knowledge of the matter also shared with Finance Magnates that the VFSC also added an insurance requirement.
“Vanuatu is still a good option for non-crypto offering offshore-based brokers and as a liquidity service (internally or externally), together with Estonia which also changed recently, and Belize and Marshall Islands for self-regulated firms, for those looking for non-EU options,” elaborated the representatives from Tal Ron, Drihem & Co.
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