CySEC is an important regulator for Forex brokers within the EU. This is also because Cyprus is the preferred regulatory regime for financial companies from Israel. Many brokers from Tel Aviv, barely an hour’s flight away, settle in Cyprus and operate within the EU as a Cyprus Investment Firm (CIF) regulated by CySEC. As an EU member state, CySEC‘s financial regulations and operations comply with the European MiFID financial harmonization law.
The financial industry around the approximately 250 regulated CIFs and payment processors is an important revenue source for the small EU member.
CySEC is criticized by many for the lax oversight of CIFs. Cyprus is considered a portal to the EU financial market for non-EU companies. Due to EU license passporting, Israeli, Russian, and other non-EU companies and entrepreneurs can participate in the EU single market with a CySEC license.