Forex License in Lithuania

Forex, or the foreign exchange market, is a financial platform where the buying and selling of currencies take place. Trading on Forex attracts with its flexibility, wide range of tools, and low transaction costs.

 

Companies operating in this business sector in Lithuania are classified as investment firms. Their activities are subject to licensing according to the regulations that govern the country’s financial sector. The government regulations clearly define the types of services such organizations can provide, as well as the financial instruments available to entrepreneurs.

 

The procedure for obtaining a brokerage license in Lithuania is the same for both citizens of the country and residents of other EU states. Additionally, the beneficial owner of an investment company from any other country is also entitled to apply for a license registration.

 

However, a key condition is the presence of a brokerage activity permit issued in the jurisdiction of the country where the applicant company is officially registered.

 

Let’s take a closer look at the process of obtaining a brokerage license in Lithuania and how AA Lawrange can assist you with this issue.

Benefits of Obtaining a Forex License in Lithuania

The main benefits of obtaining a Forex license include:

1. Affordable license fees.
2. Low costs of ownership and operational activities.
3. The ability to operate internationally.
4. Relatively low capital requirements.

Contact AA Lawrange for assistance in obtaining a brokerage license in Lithuania.

Types of Licenses in Lithuania

We present to your attention a table with the main characteristics of the license categories provided by the Bank of Lithuania according to the Law on Financial Instruments Markets of the Republic of Lithuania:

 

Category	Type A – Financial Investment License of Lithuania	Type B – Financial Investment License of Lithuania	Type C – Financial Investment License of Lithuania	Tied Agent – Financial Investment License of Lithuania
Services Covered by the License	– Reception and transmission of orders for one or more financial instruments. – Execution of orders on behalf of clients. – Portfolio management. – Investment advice. – Trading for own account. – Underwriting and/or placement of financial instruments with firm commitments. – Placement of financial instruments without firm commitments. – Operations on a multilateral trading platform (MTF). – Safekeeping of clients’ funds.	– Reception and transmission of orders. – Execution of orders on behalf of clients. – Portfolio management. – Investment advice. – Safekeeping of clients’ funds.	– Reception and transmission of orders. – Execution of orders on behalf of clients. – Portfolio management. – Investment advice.	A tied agent must be approved by an investment company in Lithuania or in an European Economic Area (EEA) country.
Required company type	LLC (Ltd)	LLC (Ltd)	LLC (Ltd)	Individual or legal entity
Corporate taxation	15%	15%	15%	–
Minimum share capital	730,000 EUR	125,000 EUR	50,000 EUR	Not required
Key requirements	– Physical office. – Qualified personnel. – Compliance/AML specialist. – Internal and external audit. – Accounting. – Risk management.			An agent must be approved by an investment company in Lithuania or in an EEA country.
Application review time	The estimated processing time by the Bank of Lithuania is up to 6 months after the final submission of documents.			The estimated processing time is 1–2 months after the final submission of documents.
State fees	947 EUR			–

 

Such a structure will help easily understand the key differences between license types and their requirements.

 

Requirements for Obtaining a Forex License in Lithuania

Before starting Forex activities in Lithuania, it should be noted that investment services can only be provided by companies that hold a financial broker license issued by the regulatory authority of Lithuania or another EU country. Companies that have received a license in one of the European Union countries have the right to carry out investment activities in Lithuania, either by opening a representative office or without it.

 

The financial broker license is issued by the Financial Services and Markets Supervision Department of the Bank of Lithuania. This body oversees:

• the financial sector;
• investment services;
• the securities market.

The Department operates in accordance with local legislation – the Republic of Lithuania Law on Financial Instruments Market.

 

The Department ensures the reliability of financial institutions by checking their parameters:

• liquidity;
• capital adequacy;
• risk management system.

 

A list of all licensed operators is available on the official website of the Bank of Lithuania.

 

The requirements for license holders can be conditionally divided into four main categories:

• for shareholders;
• capital requirements;
• office requirements;
• staff requirements for the brokerage company’s branch in Lithuania.

 

Let’s examine them in more detail.

 

For the Holder

Company directors must possess:

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• an impeccable reputation;
• appropriate qualifications;
• experience that enables them to effectively perform their functions.

 

The Forex license holder has the right to provide the following services:

• Reception and transmission of orders.
• Execution of orders on behalf of clients.
• Proprietary trading.
• Portfolio management of financial instruments.
• Providing investment recommendations.
• Signing and/or distribution of financial instruments.
• Administration of a multilateral trading system.
• Management of an organized trading facility.

 

Before applying for a license for a Forex company, the owner must pay the state fee for its issuance to the account of the State Tax Inspectorate.

 

For Shareholders

Co-owners of the exchange organization who own more than 10% of the shares must:

• provide documented evidence of their managerial experience in the financial sector;
• provide diplomas or certificates confirming knowledge in capital management.

 

If a shareholder owns securities of another company that operates in a field unrelated to brokerage activities, this does not prevent their involvement in the development of the Forex company.

 

Each ultimate beneficial owner must confirm their income level and the transparency of the funding sources.

 

The Lithuania Commission reserves the right to independently assess shareholders’ knowledge of exchange activities and their professional experience.

 

For Staff and Office

Regardless of the jurisdiction of company registration, in order to obtain a brokerage license in Lithuania, the company must:

• hire at least one or two resident directors of the country;
• have management personnel with financial sector experience ranging from 3 to 8 years depending on the position and level of responsibility.

 

The Lithuania Commission has the right to check the staff and recommend the dismissal of individuals whose experience or reputation do not meet established requirements.

 

To obtain a brokerage license, the company must have a physical office in Lithuania.

 

If the company has subsidiaries, they must operate in the same financial sector. Otherwise, their registration is prohibited.

 

Capital requirements comply with European standards. Specifically, the market maker license requires a balance of 730,000 EUR, while the STP license is issued with a deposit of 125,000 EUR. Intangible assets are not included in the calculation.

 

After obtaining the license, the company is obligated to maintain capital at the required level and gradually increase it. If the balance of funds does not meet the established standards, the Commission has the right to revoke the license.

 

The Process of Obtaining a Forex License in Lithuania

If you plan to start your activities in the Forex market, one of the first steps will be obtaining a Lithuania Forex Brokerage License, which is necessary to comply with regulatory requirements. Before submitting the application, it is generally required to:

1. Register a limited liability company (UAB) or open a branch in Lithuania.
2. Ensure that your business reputation is impeccable and transparent.
3. Check that the company has no negative records in its activities, such as bankruptcies or court decisions.

 

Let’s look at the process step by step.

 

Company Registration in Lithuania

The Baltic countries traditionally remain attractive jurisdictions for registering a company in Europe. Despite the increased requirements for registering companies for non-residents, establishing a business in Lithuania opens up broad opportunities for financial activities.

 

The country has created favorable legal conditions for the development of the cryptocurrency business and fintech companies. The authorities have struck a balance between strict anti-money laundering (AML) measures and favorable conditions for the development of Forex startups.

 

Prepare Necessary Documents

The preparatory stage of the application includes the collection of documents and the following actions:

• Completion of the initial application form for the Bank of Lithuania.
• Preparation of documents detailing the company’s structure.
• Development of a business plan that meets the requirements of the Bank of Lithuania.
• Submission of the platform or website of the project to the Bank of Lithuania.
• Interaction with the regulator during the application submission process.
• Organizing a meeting with representatives of the Bank of Lithuania.
• Assessing compliance with the requirements provided by the client.
• Preparation of all necessary materials for further procedures.
• Familiarizing representatives of the potential financial brokerage company with the regulations in Lithuania.
• Preliminary meetings and consultations with experts from the Bank of Lithuania.
• Within five business days, the supervision service checks for the presence of all necessary documents and identifies whether there are any formal errors.

 

The supervision service typically contacts the applicant for a financial brokerage license, requesting additional documents or information. In this case, the application review period is extended.

 

AA Lawrange will help you navigate the necessary documents and provide answers to your questions.

 

Compliance with AML/KYC Requirements

Compliance with anti-money laundering (AML) requirements is a key condition for obtaining a license in Lithuania. According to local legislation, companies are required to:

 

• Develop and implement AML policies and procedures.
• Conduct Customer Due Diligence (CDD) and Enhanced Due Diligence (EDD).
• Comply with requirements for personal and remote client identification.
• Carry out continuous monitoring of financial transactions and business relationships.
• Appoint a Money Laundering Reporting Officer (MLRO) to monitor, report, and train staff.
• Submit reports to the Financial Crime Investigation Service (FCIS).
• Maintain documentation related to business transactions and client interactions.

 

The Bank of Lithuania provides businesses with guidelines on AML measures in the Amending resolution No. 03-17 of the board of the Bank of Lithuania of 12 February 2015 on the approval of the guidelines on the prevention of money laundering and/or terrorist financing.

 

The Know Your Customer (KYC) procedure is a key component of the CDD process, which involves client identification and verification. According to the Anti-Money Laundering (AML) Law, companies are required to collect certain information about individuals and legal entities.

 

Identification of individuals – foreign citizens is carried out using a personal identification number, date of birth, or other official document. Non-residents are also required to provide information about permission to reside, including its number, date, place of issue, and its validity period.

 

Legal entities are subject to mandatory identification, including their ultimate beneficial owners. A beneficial owner is considered to be an individual who directly or indirectly holds more than 25% of the company’s capital or voting rights, or has decisive influence on its activities.

 

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To confirm the identity of the ultimate owner of the company, they may refer to the Information System of Legal Entities Participants (JADIS) or other state registers. The use of open sources or a request for additional confirmations from clients is also permitted.

 

Anti-money laundering legislation allows the identification of clients without their personal presence in cases such as:

 

• The use of verified data provided by other financial institutions, provided they supply the necessary information upon request and provide document copies for KYC. In this case, the responsibility for compliance with CDD requirements remains with the company.
• The use of electronic identification systems with a high level of reliability according to Regulation (EU) No 910/2014 (“eIDAS Regulation”).
• Confirmation of identity using a qualified electronic signature according to eIDAS.
• Document verification during a video call. If the video does not capture the client’s face, the person must be confirmed with an enhanced electronic signature (according to Article 26 of eIDAS).
• Verification of the first payment from the client, if the funds were transferred from a financial institution within the EU or a third-country bank that adheres to similar AML standards. In such cases, a notarized copy of an identity document or its confirmation by a consular institution or local headman is additionally required.

 

Thus, Lithuania, as a member of the European Union, adheres to strict financial regulations and standards that ensure transparency, fairness, and reliable protection for investors in the Forex market.

 

Opening a Bank Account

The next step is to open an account for the further contribution of the authorized capital.

 

The following steps are necessary to open an account in Europe (EU):

 

Step 1. Choosing a bank. When choosing a financial institution, it is important to consider the following aspects:

• the nature of the company’s activities, its strategic goals, and financial plans;
• the bank’s requirements for clients, as well as the specifics of the verification process;
• the bank’s services’ suitability for the planned operations;
• the bank’s reputation and stability;
• the bank’s tariff policy and service conditions.

 

Step 2. Pre-Approval (optional). Before submitting an application, you can request preliminary approval for opening an account. This is especially relevant for businesses with a high-risk profile, such as Forex.

 

Step 3. Preparing the document package. All documents must comply with the bank’s requirements. Even the smallest inaccuracy, including dates, signatures, or lack of notarization, can lead to refusal to open the account.

 

Step 4. Completing the bank’s forms. The client fills out the forms provided by the bank (Self-assessment Forms). It is important to be as accurate as possible, as even minor errors can cause delays.

 

Step 5. Meeting with the bank. The format of the meeting depends on the financial institution’s policy. Some banks require an in-person visit to the head office, while others allow online identification or arrange a meeting in Kyiv.

 

Step 6. Application review and decision-making. The document review process may take two weeks or longer. The bank may request additional clarifications or new documents, which affects the overall decision-making time.

 

Step 7. Access to the account and online banking. After approval, the client gains full access to the account and internet banking, allowing them to efficiently manage finances remotely.

 

If you have any questions about opening an account, feel free to contact us! The legal experts of AA Lawrange will help you navigate the process without unnecessary complications.

 

Obtaining a License

After the verification of the submitted documents, the Board of the Bank of Lithuania reviews the summarized information prepared by the Supervisory Service and makes a decision on issuing the license or requests additional explanations and documents.

 

The process of obtaining a license usually takes no less than 6 months.

 

Taxation System in Lithuania

In Lithuania, companies are taxed at two different rates: the standard 15% and the preferential 5%, which applies to businesses with fewer than 10 employees and an annual turnover of up to 300,000 euros (approximately 324,000 USD). The rapid increase in the tax burden for businesses exceeding this threshold prompts entrepreneurs to artificially undervalue their declared turnover.

 

Why Choose Lawrange as Your Technology Law Firm

The Lawrange team brings together highly qualified lawyers, legal experts, and tax consultants who have significant experience in their field. Our experts will select the optimal solution according to your needs.

 

The Lawrange law firm has been providing professional services in the fields of law, finance, and taxation for over 10 years. We specialize in matters of mergers and acquisitions, banking law, intellectual property, immigration, litigation, and legal support for businesses.

 

Lawrange specialists create individual anti-money laundering (AML) policies for each Forex company, carefully considering the regulator’s requirements. Our experts help develop and implement mechanisms for the rapid detection and prevention of financial fraud. Failure to comply with AML standards may result in the platform becoming a tool for money laundering, which can lead to serious fines and negative consequences for business reputation.

 

Conclusion

Lithuania is considered one of the most promising European jurisdictions for obtaining a Forex license. This is due to the fastest licensing procedure, support for startups, and favorable conditions for investors.

 

The country has achieved significant success in preventing money laundering and terrorist financing, making compliance with regulatory requirements a key aspect for fintech companies looking to enter this market.

 

To fully take advantage of the opportunities Lithuania offers as a financial technology hub, businesses must carefully comply with all current and future regulatory requirements. AA Lawrange can assist you with this.

 

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