E Forex Brokers May Start Fleeing The UK! But Where Will They Go?

However, when it comes to economic growth, the willingness of the population to participate in the markets and the language barrier, South Africa emerges as a perfect candidate. According to reports, dozens of Forex brokers have already started applying for licenses. In addition to all of this, South Africa is still relatively close to the CET timezone, which is an advantage to the brokerages as they can still maintain their staff on the European Continent.

Australia

Australia comes in second place. It does indeed have quite a lucrative market, but the competition is quite large. The political, economic and social situation in Australia is far more reliable than anywhere else. However, the fact that it is a developed country, implies that there will be a bunch of costs connected to packing up and moving the whole company there.

Licenses by themselves cost hundreds of thousands of dollars and some brokers are not ready to make that commitment. Furthermore, the timezones are way off and the bulk of their customer base will be left with either low-quality support or no support at all.

Australia is also susceptible to being influenced by EU regulations. The systems are very similar, but not as restricting. But if the Aussies were to see benefits in a heavily regulated industry, the brokers would have to rinse and repeat their moving process.

New Zealand

New Zealand is a good choice for a very small brokerage. It wouldn't cost them too much to move and the operational costs will be on the low end as well. However, the largest problem with New Zealand is its market size. There are about 4.8 million people living there and the percentage of people interested in Forex trading is bound to be on the low end. For a large firm that is most common in the UK, this country is just not worth it.

The Nomad life?

After these listings, it does indeed look quite dire for the brokerages. They may remain in the UK and risk huge losses because of damage to the GBP. But that is also out of the question, as the FCA has already stated that it agrees with ESMA regulations fully. Even if the UK were to leave with a Hard Brexit, the regulations would still remain.

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