Seychelles has established a formal regulatory regime for Virtual Asset Service Providers (VASPs) through the Virtual Asset Service Providers Act, 2024.

Under this framework, any entity operating a crypto exchange, crypto brokerage, digital asset wallet, custody platform, or virtual asset investment service in or from Seychelles must obtain a Seychelles VASP licence issued by the Financial Services Authority (FSA).

The Seychelles VASP regime is designed to position the jurisdiction as a regulated international hub for digital asset businesses, while ensuring compliance with international AML/CFT and FATF standards.

For founders launching or relocating crypto exchanges, trading platforms, custody solutions and more, regulatory success depends on three key pillars:

Scope clarity. Substance alignment. Governance integrity.

At FiveComply, our Licensing team specialises in structuring and licensing Virtual Asset Service Providers in Seychelles, ensuring applications are regulator-ready and aligned with the expectations of the Seychelles Financial Services Authority (FSA).

1. What Activities Require a Seychelles VASP Licence?

A Seychelles VASP licence is required where a company carries on virtual asset services in or from Seychelles.

The regulatory framework recognises four main licence categories:

1. Virtual Asset Exchange

Platforms facilitating the trading or exchange of digital assets, including crypto-to-crypto and crypto-to-fiat exchanges.

2. Virtual Asset Wallet / Custody Service

Businesses providing custody or safeguarding of virtual assets, including hosted wallets and custody platforms.

3. Virtual Asset Broker

Entities acting as intermediaries executing digital asset transactions on behalf of clients.

4. Virtual Asset Investment Provider

Companies offering digital asset investment management, advisory, or portfolio services.

Important Regulatory Conditions

Under the VASP Act:

• Only Seychelles-incorporated companies (domestic entities or International Business Companies – IBCs) may apply.
• Individuals cannot hold a VASP licence.
• Certain activities are expressly prohibited, including:
  • crypto mining operations
  • mixing or tumbling services designed to obscure transaction traceability.

One of the most common causes of regulatory delays is misclassification of the business model. The FSA assesses the actual operational structure, not merely the description in the licence application.

FiveComply assists clients in mapping their operational model to the correct VASP licence category, ensuring regulatory alignment from the outset.

2. Minimum Capital Requirements for a Seychelles VASP Licence

The Virtual Asset Service Providers (Capital and Other Financial Requirements) Regulations, 2024 prescribe minimum paid-up capital requirements depending on the licence category.

Minimum capital thresholds include:

• USD 150,000 — Virtual Asset Exchange
• USD 75,000 — Virtual Asset Broker
• USD 25,000 — Virtual Asset Wallet (Custody) Service Provider
• USD 50,000 — Virtual Asset Investment Provider

Where a company applies for multiple VASP licence categories, capital requirements must reflect the combined risk exposure of the activities conducted.

The required capital must:

• Be fully paid-up
• Be supported by clear source of funds documentation
• Be maintained continuously after licensing

For crypto exchanges and custody providers, capital planning must reflect asset safeguarding obligations and operational risk, not merely statutory minimums.

FiveComply supports applicants with:

• source of wealth and source of funds analysis
• regulatory-aligned financial projections
• capital structuring strategies.

A robust capital framework significantly reduces regulatory queries and licensing delays.

3. Substance Requirements for VASP Companies in Seychelles

The Seychelles VASP framework requires genuine economic presence in the jurisdiction.

Applicants must demonstrate operational substance, including:

• a physical office in Seychelles
• at least two natural person directors
• at least one resident director
• a local Compliance Officer
• adequate staffing proportionate to the scale of operations
• board and management meetings conducted in Seychelles
• records accessible from the Seychelles office
• local complaint handling oversight

FiveComply supports VASP clients with:

• resident director solutions
• local compliance officer appointments
• complaints handling officer support
• physical office arrangements
• governance and operational structuring

This ensures the business meets both licensing requirements and ongoing substance expectations.

4. Governance Requirements and Key Appointments

Strong governance is a core requirement for obtaining a Seychelles VASP licence.

Board Requirements

• Minimum two natural person directors
• At least one director resident in Seychelles
• All directors must satisfy Fit and Proper criteria

Mandatory Key Functions

The regulatory framework expects the appointment of:

• Directors
• Compliance Officer
• Principal Officer(s)
• Information Security Officer
• External Auditor (to be appointed within 30 days of licensing)

Fit and Proper Assessment

The Fit and Proper Code for VASPs evaluates:

• professional experience
• industry competence
• financial soundness
• reputation and integrity
• absence of adverse regulatory findings.

Failure to appoint qualified and experienced individuals is one of the most common reasons for licensing delays or regulatory queries.

FiveComply conducts Fit and Proper pre-assessments prior to application submission to ensure regulatory expectations are met.

5. AML/CFT and Compliance Framework Requirements

VASPs licensed in Seychelles must maintain a comprehensive AML/CFT compliance framework aligned with:

• Seychelles AML legislation
• FATF recommendations
• FSA supervisory expectations.

Generic templates are easily identifiable and often lead to multiple regulatory queries.

FiveComply develops customised regulatory frameworks tailored to each VASP applicant’s operating model.

6. Ongoing Compliance Obligations for Seychelles VASPs

Obtaining a Seychelles VASP licence is only the first step. Licensed entities must comply with ongoing regulatory obligations.

These include:

• payment of annual licence fees
• submission of annual compliance returns
• substance reporting
• annual AML reporting
• cybersecurity reporting
• audited financial statements prepared under IFRS
• maintaining records for at least seven years

The FSA may also request access to transaction records or operational data where required.

FiveComply provides post-licensing compliance support, assisting VASPs with regulatory reporting and ongoing FSA engagement.

7. Seychelles VASP Application Assessment

The FSA reviews only complete licence applications. Incomplete submissions could be rejected.

Why Work with FiveComply for Seychelles VASP Licensing?

FiveComply’s Offshore Division specialises in crypto licensing and financial regulation across offshore jurisdictions.

Our expertise includes among others:

• Seychelles VASP licensing
• Seychelles Securities Dealer licences
• governance and Fit & Proper structuring
• AML/CFT framework development
• capital planning and regulatory alignment
• resident director and substance solutions
• post-licensing compliance support.

Each project is structured based on the client’s operational model, regulatory strategy and risk exposure, ensuring applications are fully aligned with FSA expectations.

8. Start Your Seychelles VASP Licence Application

Seychelles has emerged as a regulated jurisdiction for digital asset businesses, offering a structured framework for crypto exchanges, brokers and custody providers.

However, regulatory approval requires:

• correct licence categorisation
• strong governance structures
• genuine local substance
• robust AML/CFT controls
• strategic regulatory engagement.

If you are planning to launch or relocate a crypto business in Seychelles, our team can guide you through the entire VASP licensing process, from initial structuring to regulatory approval.

Secure your Seychelles VASP licence with confidence.

📧 info@fivecomply.com
🌐 fivecomply.com

Over the past few years, the United Arab Emirates has steadily transformed into one of the most attractive regulatory destinations for financial services firms seeking international expansion. What was once viewed primarily as a regional financial centre has evolved into a jurisdiction increasingly considered alongside established global regulatory hubs.

A key driver behind this development has been the evolution of the Capital Markets Authority (CMA) (ex-SCA) — and the continued maturation of its licensing and supervisory framework.

Today, firms are no longer approaching the UAE solely for commercial presence or market visibility. Instead, they are seeking regulated status under the CMA as part of broader strategic expansion plans, often through licensing structures such as CAT-1 and CAT-5 authorisations aligned with their operational model.

 

A Shift in How Firms View UAE Regulation:

Historically, many financial institutions prioritised European licences for credibility and offshore jurisdictions for operational flexibility. The UAE now occupies a distinct middle ground: a jurisdiction offering both regulatory substance and commercial accessibility.

This balance has become particularly attractive to brokerage groups, fintech firms, investment intermediaries, and digital-asset related businesses aiming to diversify their regulatory footprint while maintaining proximity to rapidly growing investor markets across the Middle East, Africa, Europe and Asia.

Importantly, the CMA framework emphasises genuine operational presence. Licensing is increasingly focused on governance standards, compliance infrastructure, and clearly defined business models rather than purely formal registration. As a result, firms entering the UAE market are expected to demonstrate long-term commitment and regulatory readiness from the outset.

 

Increasing Regulatory Interest — and Why Now:

Recent market developments suggest a noticeable acceleration in licensing interest. Firms are reassessing jurisdictional strategy amid evolving global regulatory expectations, rising operational scrutiny in traditional markets, and the need for geographically diversified structures.

The UAE offers several advantages within this context. Its regulatory environment is internationally aligned yet commercially pragmatic. In parallel, continued government investment in financial innovation has reinforced confidence among both startups and established institutions.

In parallel with this growing interest, demand has increased for both CAT-1 and CAT-5 licenses in the UAE, reflecting different operational approaches adopted by market participants. Under the CMA licensing framework, a CAT-1 licence in the UAE typically supports firms operating a full brokerage model, enabling them to onboard and service clients directly within the UAE under a fully regulated structure. By contrast, CAT-5 licence holders in the UAE generally focus on introduction and promotion activities, referring clients to other regulated entities while maintaining a regulated presence in the region.

For many applicants, a CMA licence is no longer viewed simply as market entry into the UAE, but as a strategic regulatory anchor supporting international growth.

 

Navigating the Licensing Process:

Despite growing interest, obtaining authorisation under the CMA framework remains a structured and detail-driven process. Applicants must clearly articulate their operating model, governance arrangements, and compliance controls, while ensuring alignment between commercial objectives and regulatory permissions.

In practice, challenges often arise not from regulatory complexity itself, but from misalignment between a firm’s intended activities and the licensing structure selected at the initial stage. Early strategic planning therefore plays a decisive role in determining both application timelines and overall success.

Regulator engagement also tends to be iterative, requiring applicants to demonstrate transparency, preparedness, and a clear understanding of local regulatory expectations.

 

FiveComply’s Perspective

At FiveComply, we have observed first-hand the increasing sophistication of firms approaching UAE CMA licensing, including successful applications for both CAT-1 and CAT-5 authorisations. Applications are becoming more strategic, with organisations seeking not only approval but sustainable regulatory positioning within the region.

Our role typically extends beyond application preparation to include regulatory structuring, governance design, and ongoing compliance alignment — ensuring that licensing outcomes support long-term operational objectives rather than short-term market entry.

 Having supported clients across multiple CMA licensing categories, we continue to see the UAE emerge as a central jurisdiction within global expansion strategies for financial services businesses.

 

Looking Ahead:

As financial regulation continues to evolve globally, jurisdictions capable of combining credibility, accessibility, and regulatory clarity are likely to attract sustained industry attention. The UAE, under the CMA framework, appears increasingly positioned within this group.

For firms evaluating their next stage of international growth, establishing a regulated presence in the UAE is becoming less a question of opportunity and more one of strategic timing. Success, however, depends not only on selecting the right jurisdiction, but on approaching licensing with a clear regulatory strategy and a well-structured operational model from the outset.

Against this backdrop, firms increasingly seek advisors with practical experience navigating the CMA framework and supporting applications beyond the initial approval stage.

With an active on-the-ground presence in Dubai and extensive experience supporting firms across multiple Capital Markets Authority (CMA) licensing categories, compliance implementation, and ongoing regulatory support, FiveComply assists financial institutions in establishing and scaling their regulated presence in the UAE with confidence.

 

Get in touch with our team:

📞 +357 25 34 00 25
📧 regulatory@fivecomply.com

Analysis of the Financial Services Authority’s 2024 Annual Report: Key Regulatory Developments and Sector Insights in Seychelles

 
1. Introduction

The Financial Services Authority (“FSA”) in Seychelles has published its 2024 Annual Report, outlining a year marked by regulatory consolidation, strengthened supervisory frameworks and closer alignment with international standards. As Seychelles continued refining its financial services landscape, the 2024 report provides clarity on the jurisdiction’s direction, priorities and progress across several core areas.

The article highlights and analyses the most significant developments of the past year, based on information published in the Report.

 

2. Implementation of the VASP Framework

The Virtual Asset Service Providers Act, 2024 (“VASP Act, 2024”) together with its suite of supporting regulations, became fully operational during the year. These instruments establish requirements for licensing, cybersecurity controls, client asset protection, advertising standards and the registration of ICOs and NFTs.

This framework brings Seychelles into alignment with FATF Recommendation 15 and positions the jurisdiction among the few in the region with a complete and modern regulatory regime for virtual asset activities. According to the Report, this is intended to safeguard market integrity while enabling innovation in areas such as digital assets and fintech.

 

3. Strengthened AML/CFT Oversight and Alignment with FATF

The Report outlines continued reforms to the national AML/CFT framework, driven by the FSA, the Central Bank of Seychelles and the FIU. Notable outcomes include the upgrade of FATF Recommendation 4, which concerns the ability of a jurisdiction to freeze, seize and confiscate of crime through effective legal and operational measures, to Compliant. The ongoing implementation of the AML/CFT Act, 2020 and related Beneficial Ownership reforms and coordinated supervision across sectors further strengthened the jurisdiction’s ability to detect, prevent and respond to financial crime risks.

 

4. Removal from the EU Blacklist and Progress on Tax Transparency

The Report confirms that Seychelles was removed from the EU’s Annex I (i.e. commonly referred to as “Blacklist”) and placed on the grey list in February 2024, awaiting the results of the supplementary review in 2025. The shift followed substantive legislative updates on ownership information and the submission of a request for an OECD Global Forum supplementary review, which was scheduled for 2025.

The move to the grey list reduced reputational and operational risks for the jurisdiction, while the upcoming supplementary review underscores the need for continued improvement in information availability and exchange-of-information practices.

 

5. Advancement of International Organisation of Securities Commissions (IOSCO) Technical Assistance

During the year, the FSA finalised the ‘Terms of Reference for a Technical Assistance’ programme with IOSCO. This programme will review the legal and supervisory framework governing securities, identify deficiencies and recommend the reforms necessary for Seychelles to meet the IOSCO Multilateral Memorandum of Understanding standards.

The Report notes that this work forms the basis for Seychelles’ planned reapplication for Ordinary Membership and MMoU signatory status. Achieving these milestones would significantly strengthen cross-border regulatory cooperation and enhance the jurisdiction’s standing in global capital markets.

 

6. Continued Economic Growth Driven by Tourism and ICT

The economic section of the Report demonstrates that Seychelles recorded real GDP growth of 3 percent in 2024. Growth was supported primarily by tourism, with 352,762 visitors arriving during the year, and by the ICT sector, which expanded by 10 percent as digitalisation efforts intensified.

Although external pressures such as higher freight costs and a weaker rupee affected inflation and operating conditions, the Report highlights a stable overall economic environment, which supports the ongoing development of the non-bank financial services sector.

 

7. Strengthening Institutional Capacity and Risk Management

The Report highlights internal advancements within the FSA, particularly in governance, staff development and risk management. Key initiatives included the development of strategic risk management documents, enhancements to internal audit processes and the introduction of Strategic Planning Champions to support implementation of the 2021-2025 Strategic Plan.

 

 

8. Conclusion

The 2024 Annual Report demonstrates continued progress in strengthening Seychelles’ regulatory frameworks and institutional capacity. The developments in digital asset regulation, AML/CFT alignment, tax transparency, international cooperation and internal governance reflect a jurisdiction prioritising stability, transparency and long-term credibility.

Looking ahead, Seychelles is positioned for a pivotal year as it moves toward further FATF re-ratings, the Global Forum supplementary review and renewed engagement with IOSCO. The direction set in the 2024 Annual Report suggests continued regulatory strengthening, greater international alignment and a more structured supervisory environment for firms operating in the jurisdiction.

For business entering or operating in Seychelles, FiveComply provides streamlined licensing and compliance solutions aligned with the latest regulatory developments, from digital asset regulation to strengthened AML/CFT and transparency standards.

 

Disclaimer: This article is provided for general informational purposes only and does not constitute legal, regulatory or professional advice. Readers should seek independent advice before taking any action based on the information contained herein.

The United Arab Emirates (UAE) has rapidly emerged as a key global financial hub, attracting investors and financial firms from around the world. As the market continues to grow, the need for clear regulatory frameworks becomes increasingly important to ensure transparency, protect investors, and foster trust.

 

At the heart of this regulatory landscape is the Securities and Commodities Authority (SCA), responsible for setting standards that ensure trust, transparency, and market integrity.
One of the key authorizations under the SCA framework is the Category 5 License, designed specifically for firms engaged in arranging and advisory activities within the UAE’s financial markets.
It enables  companies to promote financial products, introduce investors to licensed regional and global entities, and offer advisory services — all while complying with the highest regulatory standards.

 

In short, a Category 5 License offers an entry point for companies aiming to connect UAE investors with global financial opportunities. It is designed for international brokers seeking to legally and transparently engage clients and promote their financial products within the UAE.

 

Understanding the scope and benefits of the Category 5 license is essential for businesses aiming to establish or expand their presence in the UAE’s financial sector. This article explores why this license matters, the opportunities it creates, and how firms can navigate the application process successfully.

 

UNDERSTANDING THE SCA CATEGORY 5 LICENSE:

The Category 5 License authorizes companies to conduct the so-called “Arranging and Advisory” activities, including:

• Promoting or marketing of financial instruments
• Introducing investors to regulated financial institutions
• Providing financial consultancy and advisory services

— all without directly managing or holding client funds!

 

Firms can facilitate connections between investors and licensed brokers, asset managers, or product issuers, while ensuring compliance with UAE’s strict conduct and marketing standards.

 

WHY OBTAIN THE SCA CATEGORY 5 LICENSE?

 1. Regulatory Credibility

Operating under an SCA license demonstrates that your firm meets all regulatory standards and maintains strong internal controls, governance, and transparency. It immediately establishes trust with both institutional partners and clients, differentiating your business from unlicensed operators and helping you avoid any potential breach of SCA regulations and decisions.

 

2. Enhanced Market Access

This authorization provides a gateway to new business opportunities and partnerships in investment promotion, brokerage introductions, and financial advisory. It also offers a clear and compliant pathway for foreign financial institutions seeking to establish a presence or expand their reach in the UAE through promotional and introduction activities. Holders of this license may introduce UAE-based investors to their regulated brokerage or investment entities abroad, ensuring that all communications and marketing efforts comply with the SCA’s standards for conduct, transparency, and fair promotion.

 

3. Investor Confidence

Licensing gives clients the assurance that all activities are supervised by a respected regulatory authority. It signals integrity, professionalism, and commitment to operating transparently, critical factors for attracting and retaining clients and business partners in the financial services industry.

 

4. Legal Protection and Operational Clarity

Obtaining an SCA license gives your business a clearly defined regulatory framework to operate within. It ensures your promotional and introduction activities are fully recognized by the regulator, protecting both your firm and your clients from the risks linked to unlicensed financial marketing. By operating under an authorized structure, you gain legal certainty and clear guidance on how to conduct compliant activities in the UAE market.

 

5. Alignment with International Standards

The SCA framework is aligned with global financial governance standards, including the OECD and FATF principles. Licensed firms benefit from being recognized as compliant with international norms which is an essential factor when expanding into regional or cross-border partnerships.

 

6. Sustainable Business Growth

 By building a regulated structure from the start, your firm can scale confidently knowing its operations meet regulatory expectations and can adapt to future compliance developments.

An SCA license lays the foundation for long-term growth, reputation, and business continuity.

 

A FINAL CONSIDERATION

 The SCA Category 5 License is more than a regulatory requirement.  It is a strategic asset that builds trust, enables growth, and enhances access to the UAE’s thriving financial markets.

 

Whether you’re an international firm entering the UAE or a local business seeking to expand,

FiveComply ensures your licensing journey is seamless, transparent, and compliant every step of the way.

 

HOW WE CAN HELP

At FiveComply, we provide end-to-end support to help firms obtain their SCA authorization smoothly and with confidence. Obtain your license with confidence through our tailored approach, which includes A-to-Z guidance throughout the licensing process, ongoing compliance support, and internal audit services to ensure continued regulatory alignment.

 

Our goal is to ensure that every licensing project is completed accurately, meets all regulatory requirements, and supports each client’s firm’s long-term operations in the UAE.

 

Book a consultation with our team today for actionable guidance and a streamlined path to securing your SCA Category 5 license.

On 5 September 2025, the Cyprus Securities and Exchange Commission (CySEC) issued Regulatory Administrative Act (RAA) 270/2025, amending its National Product Intervention Measures (NPIMs) on Contracts for Difference (CFDs). The move reflects CySEC’s ongoing focus on investor protection, market stability, and alignment with EU supervisory standards.

 

1. New CFD Leverage Restriction:

The amendment revises Annex I of Directive DI87-09 and introduces a 10% initial margin requirement (1:10 leverage) for CFDs where the underlying is:

• Any commodity, and
• Any stock index not expressly listed in the 1:20 leverage category (i.e. gold and major equity indices such as FTSE 100, DAX, S&P 500, etc.).

In practice, this ensures that all unlisted or exotic commodities and indices will now fall under the 1:10 leverage cap.

 

1. Background (2019–2025 Framework):

Since 2019, CySEC has imposed permanent limits on CFD leverage for retail clients, aligned with ESMA’s measures:

• 1:30 – Major FX pairs
• 1:20 – Non-major FX pairs, gold, and major indices
• 1:10 – Other commodities and non-major indices
• 1:5 – Individual equities and other reference values
• 1:2 – Cryptocurrencies

The new amendment closes gaps by ensuring that any product outside the 1:20 category now defaults to 1:10 leverage, reducing scope for regulatory arbitrage.

While commodities (other than gold) and non-major indices were already capped at 1:10, there was scope for interpretation regarding new or unlisted products.

 

1. Wider Regulatory Developments

Alongside the CFD amendment, CySEC continues to expand its supervisory agenda:

• Sanctions enforcement: A new framework strengthens compliance with EU and UN sanctions, including the creation of the National Sanctions Implementation Unit under the Ministry of Finance. Regulated firms must enhance monitoring, reporting, and internal controls.
• Capital adequacy: From early 2025, CySEC will apply EBA guidelines on the group capital test under the Investment Firms Regulation (IFR), clarifying requirements on capital, risk management, and governance. Low-risk firms may apply for reduced capital requirements, though CySEC retains the right to revoke permissions if conditions change.
• Forward-looking priorities: CySEC has signalled its focus on digital transformation, enforcement of upcoming MiCA (crypto-assets) and DORA (digital resilience) frameworks, and improving supervisory capacity. For 2025, its budget of €17.5 million will fund increased staffing and technology investments.

 

1. What Investment Firms Shall Do

• CFD brokers: Adjust margin settings, review product catalogues, and update client agreements, risk warnings, and marketing communications to reflect the new leverage rules.
• All regulated firms: Ensure sanctions compliance frameworks are up to date and prepare for capital adequacy changes under the EBA guidelines.
• Compliance teams: Reinforce monitoring and staff training to align with CySEC’s stricter supervisory approach.

Although the amendment does not overhaul leverage rules, it represents a tightening of scope. By closing definitional gaps, CySEC has made clear that any retail CFD product not explicitly listed under higher categories will be restricted to 1:10 leverage.

This move signals CySEC’s intent to limit regulatory arbitrage and reinforce its reputation as a regulator aligned with the EU’s strictest investor protection standards.

 

How We Can Help

If your firm requires assistance in reviewing product offerings, updating margin settings, or aligning compliance documentation with the new directive, please contact our team of experts.

 

FiveComply can support you in navigating CySEC’s evolving regulatory framework.

The UAE is one of the first countries to establish a dedicated regulator for virtual assets, providing legal clarity, investor protection, and regulatory innovation in a rapidly evolving industry. Dubai has rapidly become a global hub for virtual assets and blockchain innovation and at the center of this ecosystem is the Virtual Assets Regulatory Authority (VARA).

 

What Is VARA?

Established under Law No. (4) of 2022 Regulating Virtual Assets in the Emirate of Dubai (Dubai VA Law), VARA is the regulatory authority responsible for overseeing Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs) in Dubai (excluding the DIFC, a separate financial free zone in Dubai, that is regulated by the Dubai Financial Services Authority (DFSA)). Its mandate is to provide a clear, progressive framework to govern and enable the responsible growth of the virtual asset economy. As part of its strategic goals, VARA aims to position Dubai as a global hub for virtual assets, promote innovation and investment, and ensure strong regulatory protections for market participants.

 

What Is a VASP Licence?

Any firm seeking to carry on Virtual Asset activities in or from Dubai (excluding DIFC) has a legal obligation to be licensed by VARA prior to commencing operations. This includes businesses involved in:

• Virtual Asset Platform operation and management services.
• Exchange between Virtual Assets and national or foreign currencies.
• Services for the exchange between one or more forms of Virtual Assets.
• Virtual Asset transfer services.
• Virtual Asset safekeeping, management, or control services.
• Services related to Virtual Asset Wallets.
• Services related to offering, and trading in, Virtual Tokens.

No person may carry out these activities without obtaining a permit from VARA, issued according to applicable legislation and procedures. Businesses must be legally established in Dubai, in an approved legal form, and must secure VARA’s approvals before proceeding with commercial licensing. All activities must comply with the requirements and regulations specified in the permit.

 

Key Steps to Obtain a VARA VASP Licence

Applying for a VASP Licence is completed in two stages: First, application for an Approval to Incorporate (“ATI”) to establish a legal entity and to commence operational setup, then an application for VASP Licence.

 

Step 1: Initial Disclosure and Business Setup

• Submit the Initial Disclosure Questionnaire (IDQ) to Dubai Economy & Tourism (DET) or the relevant Free Zone authority.
• Provide required documents, including your business plan and details of beneficial owners and senior management.
• Pay initial fees (usually 50% of the licence application fee).
• Receive Approval to Incorporate (ATI), allowing you to complete your company’s legal incorporation and operational setup (office, employees, etc.).

Note: At this stage, your firm is not permitted to conduct virtual asset activities. VARA may withhold ATI if your business falls outside the regulatory scope or does not meet standards.

 

Step 2: Full VASP Licence Application

To apply for a Category 5 license, businesses must meet specific regulatory and operational requirements set by the SCA

• After obtaining ATI, prepare and submit your full VASP licence application to VARA with the necessary documentation as guided.
• Engage with VARA during their review process, which may involve meetings, interviews, and additional document requests.
• Pay the remaining licence fees and the first year’s supervision fees.
• Upon successful review, receive your VASP Licence, which may include operational conditions to comply with.

Once you’ve obtained your VARA licence, your firm must operate strictly within the scope of the approved permit. Ongoing compliance with VARA’s regulatory framework including reporting, disclosures, and supervision requirements is mandatory to maintain your licence in good standing.

 

Paid-Up Capital Requirements Under VARA

To ensure financial stability, operational resilience, and protection to clients, ensuring the long-term integrity of Dubai’s virtual assets ecosystem, Virtual Asset Service Providers (VASPs) licensed by VARA are required to maintain specific levels of Paid-Up Capital. These requirements vary depending on the type of virtual asset activity a firm undertakes ranging from AED 100,000 for advisory services to up to AED 1.5 million for exchange services. In some cases, the capital threshold is calculated as a percentage of the VASP’s fixed annual overheads, whichever is higher.

If a VASP is licensed for multiple activities, it must maintain separate Paid-Up Capital for each, based on the overheads specific to that activity. All Paid-Up Capital must be reconciled monthly and held in a secure manner, such as a UAE bank trust account naming VARA as the beneficiary, a surety bond, or another method approved by VARA.

 

How FiveComply Can Help:

FiveComply can help you navigate the full licensing lifecycle, —from application to approval—  and support your business with ongoing compliance and regulatory guidance, ensuring you remain fully aligned with VARA’s expectations and Dubai’s regulatory standards.

We can assist you with:

• Business Setup & Documentation: Supporting Free Zone incorporation, preparing required documents, and guiding you through the entire application process.
• VASP Licensing Strategy: Structuring your application and compliance approach to align with VARA’s detailed licensing requirements.
• Ongoing Regulatory Support: Providing continued assistance with compliance obligations, VARA communications, and evolving reporting requirements.

Book a consultation with our team today for actionable guidance and a streamlined path to securing your VASP licence in the UAE.

FiveComply is a global consultancy group with local presence in Cyprus, Dubai, Seychelles and Mauritius, specialising in international licensing, setting up corporate/group structures, and operations of Investment Firms, Crypto Asset Service Providers, E-Gaming, Payment Institutions / EMIs and Investment Funds with a specific focus on regulatory compliance matters. FiveComply Group provides comprehensive solutions in forex, crypto, EMI and fund licensing across various offshore and European jurisdictions.

In this interview, we will hear from Gabriel Styllas, the CEO of FiveComply Group, as he provides valuable insights into the UAE Securities and Commodities Authority (SCA) License. We will explore its key characteristics and discuss the growing popularity of the UAE SCA license in today’s financial landscape.

 

Q1: Why FiveComply decided to expand in Dubai?

FiveComply Group has been among the market leaders in the licensing and regulatory compliance sector for over 20 years, providing clients with tailored roadmaps to navigate the best jurisdictions for their licensing needs. We assist our clients not only in obtaining licenses but also in establishing efficient organizational structures.

We consider the UAE Securities and Commodities Authority (SCA) as a highly credible regulatory body, and we believe that the UAE SCA license is the most suitable option for brokers aiming to serve clients in the UAE. Given the significant demand for the UAE SCA license, we made the strategic decision to invest in the region by establishing FiveComply offices. This expansion allows us to better assist our clients who are interested in obtaining the UAE SCA license.

 

Q2: How can you acquire a license in the UAE Under SCA Regulations via FiveComply?

The Securities and Commodities Authority (SCA) is the primary financial regulatory body in the UAE, responsible for overseeing the securities, commodities, and financial services sectors. Established to enhance market transparency and investor confidence, the SCA enforces strict compliance with international financial standards. Its role includes licensing and supervising financial service providers, setting regulatory frameworks, and ensuring adherence to Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) requirements.

As the UAE continues to solidify its position as a global financial hub, the SCA plays a crucial role in fostering a stable and competitive investment landscape. Financial service providers looking to operate in the country must obtain an appropriate license from the SCA, ensuring compliance with regulatory requirements tailored to different financial activities.

FiveComply assists clients in acquiring their SCA Licence. Our team reviews and advises on the corporate structure, the proposed directors and shareholders CVs and KYC/DD documentation and prepares all the manuals and the Company’s Business Plan according to each client’s business model. Once the application is submitted to the SCA for examination, FiveComply responds to all the queries raised with the SCA and follows-up on a constant basis to ensure a smooth and prompt coordination in regard to each application.

 

Q3: What are the different SCA License Categories?

SCA offers different licensing categories depending on the nature of financial services. These include:

1. Category 1 – Dealing in Investments as Principal: Covers firms engaged in proprietary trading and investment activities.
2. Category 2 – Dealing in Investments as Agent: Suitable for firms facilitating transactions between buyers and sellers without taking principal risk.
3. Category 3 – Asset Management: Designed for firms managing investment portfolios on behalf of clients.
4. Category 4 – Custody: Encompasses firms responsible for safekeeping and administration of financial instruments.
5. Category 5 – Arranging and Advice: Focuses on financial consulting, advisory, and promotional activities without direct handling of client funds.

Each category has distinct requirements related to capital, compliance, and operational structure, ensuring that financial services in the UAE adhere to global standards.

Q4: Why Is Category 5 Important for Financial Service Providers?

Securing a Category 5 license under SCA offers significant advantages, such as:

• Regulatory Credibility: Operating under SCA regulation enhances trust and transparency, making firms more attractive to investors.
• Market Access: Enables firms to provide financial consulting and advisory services within the UAE’s expanding financial sector.
• Investor Protection: Ensures compliance with Anti-Money Laundering (AML) and Countering Financing of Terrorism (CFT) regulations, strengthening the financial ecosystem.
• Business Growth: Firms can establish themselves as reputable financial consultants, helping clients navigate investment opportunities.

Q5: What Are the Requirements to Apply for an SCA Category 5 License?

To apply for a Category 5 license, businesses must meet specific regulatory and operational requirements set by the SCA:

1. Legal Entity Establishment: The applicant must be incorporated in the UAE, either as a local entity or within a recognized free zone, provided the free zone law permits such activity.
2. Qualified Management Team: The firm must appoint:
   • A Head or Manager of the Category
   • A Head of Compliance

1. Physical Office Presence: A fully operational office within the UAE is mandatory, with local staff hired to manage key functions such as compliance, risk management, and operations.

1. Minimum Capital Requirements:
   • The paid-up capital must be no less than AED 500,000.

1. Compliance with AML & CFT Regulations: Firms must implement stringent AML/CFT policies, conduct customer due diligence, and report suspicious transactions to regulatory authorities.

1. Technology and Security Standards: Firms must ensure their platforms have robust cybersecurity measures, data protection policies, and secure transaction processing systems.

Q6: What Services Can a Licensed Financial Service Provider Offer?

Under the SCA’s regulatory framework, a licensed financial service provider under Category 5 may offer a variety of services, depending on the scope of their license. These services include:

• Financial Consulting
• Financial Advisory (Issuance Manager)
• Listing Advisory
• Introducing
• Promotion

Q7: Focusing on Promotion and Introduction Services

Among the available services under Category 5, Promotion and Introduction are the most common choices for companies due to their significant role in financial services expansion and client acquisition.

1. Promotion: This activity involves marketing and promoting financial products or investment opportunities to potential clients. Firms engaging in promotion act as intermediaries, ensuring that financial products reach the right investors while adhering to regulatory guidelines. Companies focusing on promotion must appoint a Promotion Manager to oversee compliance and strategic outreach.
2. Introduction: This service allows firms to introduce clients to financial institutions, investment firms, or other financial service providers. Unlike advisory services, firms conducting introductions do not provide direct financial guidance but facilitate connections between potential investors and service providers. No specific job title is mandated for this role, offering firms flexibility in structuring their operations.

Q8: How Long Does the Licensing Process Take?

The SCA licensing process typically takes 4-6 months, depending on the completeness of the application and compliance with regulatory requirements. The application process includes:

1. Pre-Application Consultation: Meeting with the SCA to discuss business models and regulatory expectations.
2. Submission of Application: Providing detailed business plans, compliance policies, and financial documentation.
3. Regulatory Review: The SCA assesses the application, including a due diligence review of company directors and key stakeholders.
4. Approval and Licensing: Upon successful evaluation, the applicant is granted an SCA Category 5 license to operate as a financial consulting and advisory provider.

Q9: The Future of Financial Consulting Regulations in the UAE

The UAE has positioned itself as a global leader in financial services and investment advisory. With regulations evolving rapidly, businesses operating in the sector must remain vigilant and adaptable to new compliance requirements. The regulatory acceptance of financial consulting services is a strong indicator of the government’s commitment to fostering a secure and innovative financial environment.

Q10: How FiveComply can Assist in Obtaining an SCA Financial Consulting and Advisory License?

Our team specializes in regulatory compliance and licensing for financial service providers in the UAE. We offer end-to-end support, including:

• Guidance on SCA licensing requirements and business structuring.
• Preparation and submission of regulatory applications.
• AML and compliance framework implementation.
• Ongoing compliance monitoring and reporting support.

If you are considering establishing a financial consulting or advisory business in the UAE, reach out to us for expert assistance in navigating the SCA’s licensing process and regulatory framework.

You can reach us at info@fivecomply.com for any information you might need, we are happy to provide further information, arrange a call or a face-to-face meeting!

On 28^th February 2025, the Financial Services Authority (FSA) Seychelles released Circular No. 3 of 2025, delivering important updates for Securities Dealers offering Contracts for Differences (CFDs) with Cryptocurrencies as underlying assets. With the world of digital finance rapidly evolving, staying ahead of regulatory shifts is more important than ever.

Under section 8 of Schedule 1 of the Securities Act, 2007, it is stated that ‘property of any description’ may serve as an underlying asset for CFDs, thereby permitting Virtual Assets to be included without requiring further legislative amendments.

 

FSA Key Statistics

• 190 Securities Dealers currently licensed in Seychelles.
• 187 licensees have been approved to offer CFDs under Schedule 1 of the Securities Act, 2007, covering a range of underlying assets, including but not limited to commodities, indices, forex, equities and cryptos.
• 105 entities (56%) are actively offering CFDs on Virtual Assets / Cryptocurrencies.

 

Determination on CFDS on Virtual Assets

The FSA has clarified that, CFDs involving Virtual Assets do not fall under the definition of Virtual Asset Services, as outlined in the Virtual Asset Service Providers Act, which was introduced in late 2024, as they do not involve the actual exchange, custody or transfer of ownership of Virtual Assets.  According to the FSA, CFDs on Cryptos are to be regulated as standard CFD products under the Securities Act 2007, not as virtual asset services under the Virtual Asset Services Providers Act. This formal confirmation aligns with the approach previously followed by the FSA but now has been officially confirmed in writing through this Circular.

 

Why?

• Traders do not own the actual Virtual Assets; they only speculate on price fluctuations.
• CFDs are traded on platforms and not via blockchain, like traditional crypto-trading.
• There is no actual exchange of Virtual Assets, just a financial contract.

 

Expectations of the Authority

The FSA expects all licensees to adhere to the following measures:

• Securities Dealers must conduct suitability tests to ensure traders have the necessary experience and financial knowledge to engage in CFD trading, ensuring responsible market participation.
• All promotional material must clearly outline the risks associated with CFDs on Virtual Assets, particularly their high volatility and potential financial losses. Risk warnings must be prominent and easily accessible to traders.
• Securities Dealer Licensees must avoid misleading promotions and ensure that their advertising efforts do not inappropriately target retail investors who may lack sufficient knowledge of CFD trading risks.
• Licensees must maintain detailed records of client onboarding, suitability assessments, risk disclosures and trading activities. These records must be readily available for regulatory scrutiny and potential audits by the FSA to ensure compliance with financial regulations. These records must demonstrate compliance with suitability assessments, client classification and risk disclosures.

In today’s rapidly changing regulatory landscape, entities that prioritise compliance as a strategic asset are set to excel. Staying ahead means ensuring proper licensing, implementing robust internal policies, and building strong risk mitigation frameworks—these are not just necessities, but your keys to long-term success. Make compliance your advantage and thrive in the future.

At FiveComply, our local presence in Seychelles and our team of experts specialising in Seychelles licensing and compliance are perfectly positioned to provide comprehensive A-Z solutions. Whether you are applying for a new license or require support with setup and operations, our dedicated team is ready to assist you every step of the way.

The Financial Services Authority (FSA) of Seychelles has issued Circular No. 1 of 2025, to notify licensees that the Securities (Amendment) Act, 2024, which was assented on December 13, 2024, along with the following regulations enacted by the Minister of Finance on December 30, 2024, have come into effect as of January 1, 2025:

 

• Securities (Forms and Fees) (Amendment of Second Schedule) Regulations
• Securities (Conduct of Business) (Amendment) Regulations
• Securities (Advertisement) (Amendment) Regulations
• Securities (Financial Statements) (Amendment) Regulations

 

In addition, the latest revisions to licensing fees and compliance regulations which have been clarified in the Circular No. 1 of 2025, published on 13 January 2025, bring significant changes to existing and new Licensees. The updated guidelines introduce a revised structure for both annual license fees and perpetual licensing. As part of these changes, the introduction of a new regime requires the payment of fees and submission of a compliance certificate by January 31^st each year, starting from 2025.

 

Please see below a summary of the new amendments:

 

A. Revised Annual License Fees & Perpetual Licensing

 

Annual license fees have been revised as part of the new framework. Alongside this, the introduction of a perpetual licensing regime means that existing licensees must now make payments and submit a compliance certificate annually by the 31^st of January each year to renew their licenses on time. The first deadline is set for January 31^st, 2025.

 

B. Pro Rata Adjustments for 2025

 

In a one-time adjustment for 2025, licensees will see a pro rata calculation of their annual license fees. For all existing licensees, this calculation will be done in accordance with the month of expiration of the current license. This adjustment ensures fairness and accuracy in how fees are applied.

 

As such, a relevant table has been published by the FSA as follows:

 

	Securities Exchange	Clearing Agency	Securities Facilities	Securities Dealer	Investment Advisor (Company)	Investment Advisor (Individual)	Representative
January	10,000.00	8,000.00	8,000.00	6,000.00	5,000.00	5,000.00	750.00
February	9,375.00	7, 500.00	7,791.67	5,750.00	4,750.00	4,791.67	687.50
March	8,750.00	7,000.00	7,583.33	5,500.00	4,500.00	4,583.33	625.00
April	8,125.00	6,500.00	7,375.00	5,250.00	4,250.00	4,375.00	562.50
May	7,500.00	6,000.00	7,166.67	5,000.00	4,000.00	4,166.67	500.00
June	6,875.00	5,500.00	6,958.33	4,750.00	3,750.00	3,958.33	437.50
July	6,250.00	5,000.00	6,750.00	4,500.00	3,500.00	3,750.00	375.00
August	5,625.00	4,500.00	6,541.67	4,250.00	3,250.00	3,541.67	312.50
September	5,000.00	4,000.00	6,333.33	4,000.00	3,000.00	3,333.33	250.00
October	4,375.00	3,500.00	6,125.00	3,750.00	2,750.00	3,125.00	187.50
November	3,750.00	3,000.00	5,916.67	3,500.00	2,500.00	2,916.67	125.00
December	3,125.00	2,500.00	5,708.33	3,250.00	2,250.00	2,708.33	62.50

 

C. Payment Structure for New Licensees

 

For new licensees, those who are issued a license after the first quarter of 2025 will follow a quarterly pro rata fee structure. This structure will take into account the quarter in which the license is granted and apply the fees accordingly.

 

As such, a relevant table has been published by the FSA as follows:

 

	Securities Exchange	Clearing Agency	Securities Facilities	Securities Dealer	Investment Advisor (Company)	Investment Advisor (Individual)	Representative
Quarter 1 (January, February, March)	10,000.00	8,000.00	8,000.00	6,000.00	5,000.00	5,000.00	750.00
Quarter 2 (April, May, June)	7,500.00	6,000.00	6,000.00	4,500.00	3,750.00	3,750.00	562.50
Quarter 3 (July, August, September)	5,000.00	4,000.00	4,000.00	3,000.00	2,500.00	2,500.00	375.00
Quarter 4 (October, November, December)	2,500.00	2,000.00	2,000.00	1,500.00	1,250.00	1,250.00	187.50

 

D. Compliance Deadlines for License Holders

 

For license holders who were issued their licenses before 2025, full compliance with the updated Act and regulations—excluding the changes regarding fees and perpetual licensing—is required by June 30, 2026.

 

E. Fees for 2026

 

It is noted that effective from 2026, the renewal fees for all SDL and SDRL licenses will be USD 6,000 and USD 750 respectively. Payment of these fees and renewal of the Licences will be due by January 31, 2026 for all Licensees.

 

F. Next Steps for Licensees

 

To fully understand the impact of these changes, licensees are encouraged to review the legislative amendments, detailed circular and fee tables, which are available on the official FSA website https://fsaseychelles.sc/legal-framework/legislations.

 

At FiveComply, we are dedicated to helping you stay ahead of regulatory changes and ensuring that your operations remain fully compliant. Our tailored compliance solutions are designed to integrate seamlessly into your business, providing you with the confidence to focus on your core activities.

 

If you have any questions or need assistance in understanding how these changes affect your operations, don’t hesitate to reach out to us. We are here to guide you through these updates and provide the support you need to maintain full compliance with the new regulations.

The Consolidated Directive for the Prevention and Suppression of Money Laundering and Terrorist Financing for Crypto Asset Service Providers (CASPs) integrates key provisions from R.A.D. 269/2021, R.A.D. 384/2021, and R.A.D. 343/2023. It establishes a robust framework to regulate and oversee CASPs in Cyprus, ensuring compliance with anti-money laundering (AML) and counter-terrorism financing (CTF) laws while harmonizing with EU directives.

 

Key Features of the Directive

 

1. Registration of CASPs

The directive mandates that CASPs must register with the Cyprus Securities and Exchange Commission (CySEC). The CASP Register provides transparency and public accessibility, listing key details such as:

• The CASP’s name, trade name, legal form, and physical address.
• The services and activities offered.
• The CASP’s website information.

 

2. Registration Conditions

CySEC evaluates CASPs based on rigorous criteria before approving registration:

• Integrity and Competence: Management must demonstrate good reputation, skills, and technical expertise. This includes no history of criminal activity or administrative sanctions.
• Financial Stability: CASPs must maintain sufficient financial soundness to ensure operational sustainability.
• Operational Independence: CASPs must operate through a dedicated, CASP-owned website unless specific risk assessments are conducted.
• Organizational Requirements: Proper governance, internal controls, and security measures must be in place to safeguard client assets and data.

 

3. Capital Requirements

The directive outlines tiered capital adequacy standards based on the services provided:

• Class 1: Investment advice requires initial capital of €50,000.
• Class 2: Activities like execution of orders or crypto-to-fiat exchanges require €125,000.
• Class 3: Comprehensive services, including custody and multilateral trading systems, require €150,000.

CASPs must also maintain funds equivalent to at least one-quarter of their fixed overheads from the previous financial year.

 

4. Changes and Deregistration

• Material Changes: CASPs must notify CySEC of any significant changes, such as new management, website updates, or expanded service offerings.
• Deregistration: CASPs intending to cease operations must submit a detailed six-month action plan, including client communication, fund returns, and resolution of complaints.

CySEC can also suspend or remove CASPs from the register for non-compliance, inactivity, or providing false information.

 

5. Organizational and Operational Requirements

The directive emphasizes robust internal systems:

• Conflict of Interest Policies: CASPs must manage potential conflicts between their operations and client interests.
• Client Communications: Information provided must be accurate, clear, and not misleading, enabling informed decision-making.
• Security and Record-Keeping: Comprehensive records of all activities and effective data protection mechanisms are mandatory.

 

6. Compliance and Reporting

CASPs must ensure ongoing compliance through:

• Anti-money laundering policies in line with the Prevention and Suppression of Money Laundering and Terrorist Financing Law.
• Appropriate safeguards to prevent theft or loss of client crypto assets.

 

7. Fees and Charges

Registration and operational fees include:

• €10,000 for initial registration.
• €5,000 annual renewal fee.
• Additional charges for material change notifications.

 

8. Final Provisions and Timeline

The directive includes transitional arrangements for capital adequacy:

• 30% compliance by January 2022.
• 60% compliance by January 2023.
• Full compliance by January 2024.

 

How We Can Help

 

Navigating the regulatory framework for Crypto Asset Service Providers (CASPs) can be complex and challenging. Our team of regulatory compliance experts specializes in providing tailored solutions for businesses in the crypto-asset sector, ensuring compliance with CySEC’s directives and the evolving regulatory landscape.

 

We offer comprehensive support, including:

• CASP Registration and Application Support: Assisting with the preparation and submission of complete registration applications, including guidance on meeting CySEC’s rigorous registration requirements.
• Compliance Framework Development: Designing robust internal controls, governance policies, and AML procedures to meet operational and organizational standards outlined in the directives.
• Ongoing Compliance and Reporting Assistance: Providing continuous guidance on reporting obligations, material change notifications, and interaction with CySEC.

 

Ensure your business stays compliant and ahead of regulatory changes. Contact our team today to develop a customized compliance strategy and secure your position in the growing crypto-asset market.