Belize IFSC license fee increase

19 February, Lagos – In the European region, Belize’s International Financial Services Commission (IFSC) license has been an easy way for financial trading firms seeking to get registered at a low cost. However, the landscape is now shifting. The regulator has announced vital changes to its fee structure for brokers operating within its jurisdiction.

Increase in licensing fees

A key aspect to the restructuring is the hype about the IFSC license fee structure, which includes an increase in licensing fee, alongside an upward review of the capital base requirements of such firms. In the past, financial services providers within the region have benefited from relatively low capital base requirements and licensing fees, compared to other regulators.

Changes made now put the Belize’s International Financial Services Commission (IFSC) license fee at $1,000, a 100 percent hike from the previous $500 amount. Also, the regulator has stated that this fee is non-refundable. As for the annual license fee, a four-fold leap from $5,000 to $25,000 has been stipulated.

Increase in capital base

Specific to commodity-based derivative instruments, foreign exchange and other instruments within this category, the minimum capital base has also seen a huge increase, collectively growing from $100,000 to $500,000. The IFSC has now given a time frame of about a month for the brokers and other affected institutions to comply with the new requirements. However, existing firms where given till April 1st, 2016 to transition to the new standards.

Appeal to offshore investors

Although this financial watchdog is relatively new in the field of international financial services, the IFSC has successfully enacted and implemented the International Business Companies Act based on the British Virgin Islands model. In a short space of ten years, Belize has registered more than 15,000 IBC’s, while the IFSC blacklisted countless of brokers. Belize’s IBC legislation is viewed internationally as one of the most modern and user-friendly. It is particularly designed with the offshore investor in mind.

Its ease of acquisition is one of the reasons why Forex and CFDs providers in particular fancy the IFSC license. As the IFSC license fee increases, the landscape may now be changing as the regulator’s new rules may make access to the license less easy.

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