Common Misconceptions About Mauritius Investment Dealer & Forex Broker Licenses

At Zitadelle AG, we frequently assist clients with the setup and acquisition of Mauritius Investment Dealer (Full/CFD) and Discount Broker licenses. Over the years, we have noticed several recurring misconceptions in the market - often shared by consultants, resellers, or applicants unfamiliar with actual FSC Mauritius regulatory requirements.

Below, we clarify the most common misunderstandings to help you make informed decisions when setting up or purchasing a Mauritius regulated Forex or investment dealer company.

1. Difference Between Mauritius Discount Broker and Full Investment Dealer License

Many clients approach us after applying for a Discount Broker License, believing that it allows the company to operate as a principal/market maker (i.e., take the opposite side of client trades).

This is incorrect.

A Discount Broker License is treated similarly to an ECN/STP authorization.
This means:

• The Mauritius entity must transmit orders to another regulated liquidity provider or exchange.

• It cannot act as principal, cannot internalize trades, and cannot operate as a market maker.

• It is suitable for straight-through processing (STP) brokerage models only.

If your business model requires market-making, B-Book, or principal trading, you must obtain the Full Investment Dealer (excluding underwriting) license.

2. Can a Mauritius Discount Broker Be Connected to a St. Vincent or St. Lucia Company?

Why St. Vincent or St. Lucia Entities Are Not Accepted

A common misconception is that a Mauritius broker can rely on an entity in:

• Saint Vincent and the Grenadines (SVG), or

• Saint Lucia

for liquidity or trade execution.

The FSC Mauritius does not accept unregulated entities as liquidity providers under any circumstances.

Even if an SVG company holds a so-called “letter of no objection” or internal approval from the SVG FSA, this is not considered regulatory oversight and will not satisfy FSC requirements.

Only regulated liquidity providers are acceptable.

3. Liquidity Provider Requirements Under FSC Mauritius

Some Mauritius brokers market themselves as liquidity providers, which has created confusion.

The reality:

• A Mauritius Investment Dealer is not permitted to have liquidity provision as its core business.

• Liquidity provision is a separate regulated activity, and the FSC is expected to introduce a dedicated authorization with its own capital requirements.

However, an Investment Dealer can still legally offer order execution, price feeds, and other ancillary services - as long as it is not positioned as a standalone liquidity provider.

4. Underwriting vs Non-Underwriting Mauritius License Types

We often receive questions about whether clients should choose the Investment Dealer license with underwriting.

In simple terms:

• Underwriting authorization allows the company to issue or underwrite its own securities.

• If your forex or CFD brokerage does not plan to issue structured products or new securities, underwriting is not required.

Most forex and CFD brokers choose the Investment Dealer (excluding underwriting) option.

5. Buying a Mauritius Licensed Broker: Important Warnings for Buyers

There is a growing secondary market for Mauritius-licensed brokers, especially dormant companies.

Be cautious:

• The FSC generally does not approve share transfers for companies that have never been operational.

• Some consultants claim they can “push through” dormant-company transfers via “connections.”

• This is misleading - and buyers risk losing deposits or facing rejection by the FSC.

A typical red flag is when a seller demands 50% down payment before initiating the share transfer.

At Zitadelle AG, we always conduct full compliance due diligence and confirm whether a company is eligible for a lawful transfer before any deposit is made.

Work With Zitadelle AG for Mauritius Investment Dealer Licensing

Zitadelle AG specializes in:

• Mauritius Investment Dealer (Full) license applications

• Mauritius Discount Broker license setup

• End-to-end FSC application management

• Regulated broker M&A and due diligence

• Compliance, AML/CFT, and ongoing support

If you are planning to set up a Mauritius brokerage or considering the purchase of a regulated entity, our team can guide you through every step with full regulatory transparency and realistic expectations.