Vanuatu’s Financial Dealer License (FDL) program emphasizes quality, with stringent rules and criteria, offering various licenses for financial instruments while ensuring physical presence, economic substance, and qualified management.
Vanuatu had 600 active Financial Dealer Licenses (FDL) just five years prior. There are currently only 60, but the area has chosen quality above quantity. The present group of Vanuatu brokers meets all legislative requirements, including mandatory physical presence and economic substance in the Southwest Pacific island nation, by the deadline to conform to more stringent licensing rules, adopted in 2021.
Class A licenses are available for FX deliverables and debt instruments, Class B licenses are for corporate shares, precious metals, and commodities, Class C licenses are for future contracts and derivative products, and Class D licenses are for digital assets. The Vanuatu FDL program has been relaunched.
Among the numerous requirements that the Vanuatu Financial Services Commission (VFSC) is now fully enforcing are the following: licensees must operate an office locally and maintain software systems; they must have at least one full-time manager with the authority to oversee day-to-day operations on-site; they must have at least one director with financial experience who is a resident or citizen of Vanuatu; they must also maintain professional insurance for at least US$500,000; they must deposit a US$50,000 bond.
Postal boxes are no longer sufficient
“The days when a simple P.O. Box and some accounting entries were enough to claim a stake in Vanuatu’s financial industry are over,” declared Martin St-Hilaire, the head of the Financial Markets Association (FMA), a trade association established in 2020 to advance the highest moral and professional standards among Vanuatu brokers.
“Anyone who wishes to take advantage of Vanuatu’s fiscal and regulatory system must visit the nation and give back to the local people in some way. From an offshore, safe international financial center to an onshore, open international fintech hub, Vanuatu has developed.
Deriv, Exness, Forex Chief, FX Primus, Global Clearing House, Global PoP Liquidity Solutions, Hantec Markets, Market Equity, MFM Securities, Master Select Group, Olymp Trade, Titan FX, and TradeNext are only a few of the well-known international businesses that are members of the FMA. All of them have opened up shop in Port Vila, the nation’s capital, which business experts hope will encourage industry cooperation.
These brokers should serve as an inspiration to others, St-Hilaire continued. “These brokers will bear the growth of our national industry in the coming months.” Our model jurisdiction, Cyprus, is an established, thriving fintech centre on a small island country, and we have a modest but increasing pool of local knowledge and talent that will one day make us similar.
What You Should Know About Vanuatu Brokers
A list of all currently authorized brokers, a list of organizations whose licenses were revoked, lapsed, or rejected, a fraud warning page with all known false claims of VFSC endorsement, and plenty of advice for prospective licensees, including AML-CFT and CSR compliance, employment in Vanuatu, etc. are all available on the FMA website.
The Financial Commission, a Hong Kong-based institution with dispute resolution procedures, and the Association are also partners.
Moreover the FMA wants to expand its offerings in the upcoming months and work with the VFSC to continue looking for innovative methods to improve Vanuatu’s legal system. Of course, the ultimate objective is to increase the country’s appeal to more serious brokers while preventing undesirable actors from entering the market.
St. Hilaire has faith in the future. “The world will recognize Vanuatu’s licensees as serious businesses that adhere to the highest moral and ethical standards now that Vanuatu has raised its monitoring and regulatory systems to international standards.”