NordFX Shifts Operations from Vanuatu to St. Lucia amid Regulatory Changes

NordFX Shifts Operations from Vanuatu to St. Lucia amid Regulatory Changes

Written by:

ForexBrokerTalk

December 2023

NordFX, a forex and CFD service provider, has recently shifted its operations from Vanuatu to St. Lucia. This move comes amid significant regulatory changes and raises concerns due to the use of a previously CySEC-regulated entity, now functioning as a payment agent.

Shifting Legal Entities and Operational Changes

Background: Established around 2008 or 2009, NordFX has seen several changes in its legal entities across different jurisdictions. Initially operated in Europe by the CySEC-regulated NFX Capital CY Ltd, the company later transitioned to Inveza Capital Ltd. Despite Inveza Capital’s website being offline, it continues to serve as a payment agent for NordFX.

Recent Developments: NordFX, previously registered in Vanuatu, has now relocated its base to St. Lucia. The broker, primarily active in Asia, offers high leverage trading options up to 1:1,000. However, there’s been a notable decline in its web traffic, dropping from nearly 500,000 daily visitors to approximately 233,000 in November 2023.

Client Agreements and Regulatory Concerns: NordFX has informed FinTelegram about the transition of NFX Capital VU Ltd’s registration from Vanuatu to St. Lucia. Traders should be aware that their client agreements are now with this unregulated offshore entity. NordFX has also distanced itself from the accuracy of information on its website, raising concerns among traders and industry observers.

Client Base and Market Presence: The broker claims to have over 2 million clients and 29,000 affiliates. However, these figures are currently under scrutiny. Despite assertions of not accepting clients from North America and the EU, there are indications that EU residents might still be able to register on the platform.

Vanuatu’s Regulatory Evolution

Transition to Regulation: In the past two years, Vanuatu has evolved from an offshore jurisdiction to one that regulates digital assets under the amended Financial Dealers Licensing Act. This transition has not been without challenges, as shared by licensees like Deriv, TMGM, Axi, and Titan FX. Issues such as staffing shortages and the need for better collaboration among regulatory bodies have been highlighted.

CySEC’s Intervention

License Revocation: The Cyprus Securities and Exchange Commission (CySEC) has taken a decisive step by revoking the operating license of Inveza Capital Ltd. This decision follows the company’s choice to “expressly renounce it.” Although the announcement was made recently, the decision was finalized over two months ago, on December 5, 2022.

Conclusion

NordFX’s relocation to St. Lucia amidst these regulatory changes and the revocation of Inveza Capital Ltd’s license by CySEC marks a significant shift in the forex and CFD trading landscape. Traders and industry participants are advised to stay informed and cautious, especially when dealing with unregulated offshore entities.