Germany — BaFin licence.
BaFin authorisation is the EU Tier 1 forex licence — passportable across the European Economic Area and universally recognised by prime brokers.
A considered route,
not a shortcut.
This jurisdiction rewards operators who treat the application as the start of a supervisory relationship.
When this is the right choice
When to consider an alternative
Permissions under
one Act.
Choosing the right tier and scope is the most consequential decision in the application.
Investment Firm (Wertpapierdienstleistungsunternehmen)
The primary MiFID II authorisation under the WpIG. Covers investment advice, order execution, dealing as principal, portfolio management, and underwriting. Capital ranges from EUR 75,000 (SNI firms) to EUR 730,000 (full proprietary traders).
Crypto Asset Service Provider (MiCA CASP)
Under MiCA (effective 2024), German entities apply to BaFin for CASP authorisation covering exchange, custody, transfer, and advisory services for crypto assets. BaFin-authorised CASPs hold an EU passport across all 27 member states.
Credit Institution (Kreditinstitut) — CRD VI
For firms whose business model involves client money at balance-sheet level (deposit-taking, lending, or full banking services) BaFin authorises credit institutions under CRD VI. Higher capital and liquidity requirements, but unlocks the full EU banking passport.
Phases to licence grant.
Pre-application
Months 1—3Regulatory analysis, governance structure design, capital planning, AML framework build, and a pre-application meeting with BaFin to present the business model and receive directional feedback before formal filing.
Application filing
Month 3—4Full application dossier submitted via BaFin's electronic portal — shareholder disclosures, director fit-and-proper documentation, business plan, financial projections, IT security concept, and AML/CTF manual.
BaFin review & Q&A
Months 4—12BaFin conducts a formal review. Multiple written Q&A rounds typical. Director interviews possible. German-language correspondence throughout. BaFin statutory review period is six months from a complete dossier.
Authorisation & operations
Months 12—18Authorisation granted. MiFID II passport notifications filed for target EU member states within 30 days. Operational banking, client onboarding, and prime brokerage relationships activated.
Cost and regulatory
burden.
Year-one spend is dominated by substance — resident director, office, compliance officer, external audit — not the licence fee itself.
| Cost item | Amount |
|---|---|
| BaFin application processing fee | EUR 5,000—15,000 |
| Annual supervisory fee (turnover-based) | EUR 3,000—50,000+ |
| Minimum own funds (maintained) | EUR 75,000—730,000 |
| Compliance officer (annual, resident) | EUR 80,000—150,000 |
| External auditor (WpHG audit) | EUR 20,000—50,000 / yr |
| Legal / regulatory counsel (setup) | EUR 50,000—120,000 |
| Year-1 total | ~EUR 200—500K (yr 1, ex. own funds) |
BaFin-regulated investment firms are subject to ongoing CRR III / IFR capital requirements, annual WpHG audit, and quarterly prudential reporting. The set-up cost is materially higher than Cyprus CySEC but the institutional credibility and EU passport value are commensurately stronger.
What founders
ask before filing.
The questions we get on every diagnostic call. If yours isn't here, raise it in the consultation.
Tell us where
you want to
operate.
Forty-five minutes with a partner. Jurisdiction memo within seven days. No retainer required to start.
No retainer required.