Best Forex Brokers in Norway

• No longer available for UK traders
• Does not accept traders from the US
• Somewhat lacking in terms of educational resources

Is Forex Trading Legal in Norway?

Indeed, Norwegian traders are allowed to participate in the forex market, both as retail users of foreign exchange brokers and as professionals. Contracts for difference and indices are also legal, and the same applies to stocks. What retail Norwegian users will not be able to trade, however, are binary options. They have been forbidden since 2018, as Norway decided to follow in the footsteps of the European Securities and Markets Authority (ESMA).

Forex trading is fully regulated in Norway, and companies are expected to either apply for a license from the Financial Supervisory Authority (FSA) or be authorized by another regulator in the European Economic Area. In either case, they will need to inform the FSA regarding their Norway-facing operations. A range of ESMA’s rules, including client funds segregation, leverage being capped at 1:30 for major forex pairs and the requirement for negative balance protection to be provided to retail traders, apply to FSA-licensed brokers. Brokers must also maintain capital adequacy to acquire authorization from the Norwegian FSA or another EEA-based financial watchdog.

Financial Supervisory Authority (FSA) Regulation Info

If you reside in Norway, brokers and pretty much any companies that offer financial services answer to the Financial Supervisory Authority (FSA) of Norway, which is known as Finanstilsynet in Norwegian. This regulator has been around for approximately four decades and was established after the Bank Inspection Agency, the Norwegian Insurance Council, and the Broker Control Agencies merged into a single regulatory entity.

The FSA is responsible for the oversight of most participants in the Norwegian financial market, including brokerage firms, pension funds, stock exchanges, banks, insurance and credit companies. Currently, the FSA is headquartered in Oslo and operates as part of Norway’s Ministry of Finance under the provisions of the Financial Supervision Act. Its rules and restrictions when it comes to trading are largely in line with those of the European Securities and Markets Authority. Norwegian traders can contact the financial watchdog by sending an email to [email protected] or calling +47 2293 9800.

How can I verify FSA authorization?

The first thing you will need to do is check the broker’s own website. Often, licensing information is provided on the homepage, although in some cases it can be a bit more difficult to find and you might need to navigate multiple menus or go to the frequently asked questions page. If all else fails, there is always the option to ask the customer service team via email or live chat, depending on which option you prefer and what your broker offers.

Finanstilsynet also has a comprehensive registry of all investment firms that are authorized to offer forex trading to individuals from Norway, and this can serve to verify that the broker is indeed licensed. Keep in mind that FSA licensing is not mandatory for Norway-facing brokers, so ESMA licensing or authorization from another EEA country besides Norway can also be suitable for a broker. Such brokers do need to notify the FSA if they are planning on accepting Norwegian users, however.

Traders can search for Norwegian brokers only or for companies operating from outside the country through EU passporting. Either way, the broker must appear in the register if authorized to legally target Norwegians. The regulatory body maintains a separate register for transgressing companies with regulatory warnings, unauthorized clone firms, and investment fraud.

Are my funds safe with forex brokers in Norway?

The FSA has very strict rules with regard to customer money and client safety in general. Much like other countries in Europe, Norway’s regulatory oversight pretty much adheres to the rules of the European Securities and Markets Authority. This means that in Norway, brokers need to ensure that the money of the company and the funds belonging to clients are kept segregated. In addition, leverage is relatively restricted when it comes to retail trading, and negative balance protection is also a requirement of both the FSA and ESMA.

Since brokers that offer their services to Norwegian traders are not technically required to have an FSA license, we should stress that the above protections apply to regulated brokers. Ones that are not licensed by the FSA might adhere to different regulatory requirements based on where they are based, so make sure to check which jurisdiction your broker is licensed in if they are not licensed by the FSA.

Do Norwegian brokers provide negative balance protection?

Norway-facing brokers do indeed provide negative balance protection to their retail clients. As negative balance protection is what dictates that the losses of a given user cannot amount to more money than they have in their balance, this is a very sought-after feature by retail traders. It is also mandated by Norway’s regulatory body and other entities that are responsible for licensing and regulating forex brokers.

If you are looking to become a professional trader, keep in mind that the negative balance protection rule that brokers need to adhere to only concerns retail traders. Thus, it is up to each broker to decide whether their professional clients will have the same safeguard as an option. Some have opted to offer negative balance protection to their pro users, while others exclude professionals from this service, so it all depends on which forex broker you have decided to go with.

Do you pay tax on forex trading in Norway

If you decide to participate in Norway’s foreign exchange market or you decide to trade other financial instruments, your profits will be taxed, so this is something to keep in mind before you get started if you are new to trading. Earnings generated through forex trading generally count as capital income. As such, they are usually taxed at a rate of 22%. It would be best to consult with a professional tax advisor to avoid getting into trouble with the Norwegian Tax Administration (Skatteetaten).

How does the available leverage of Norwegian FSA-regulated brokers compare to the leverage of brokers regulated offshore?

If you are familiar with the leverage available in the vast majority of European jurisdictions, Norway’s leverage limits will be nothing new. Choosing to trade major pairs will mean that, as a retail trader, you will be limited to a leverage of 1:30 at most. Minor pairs, on the other hand, cannot be traded with a leverage of over 1:20 unless the person is a professional.

As for why leverage is restricted to such an extent, it mainly has to do with how much risk it involves. Trading with leverage essentially means that you are trading with money you have borrowed from your broker. In the case of leverage of 1:30, you are trading your own money times 30. This makes the potential profits far larger than they would have been otherwise, but it also makes it possible to amass substantial losses as well. Thus, only professional traders can take advantage of larger leverage if they reside in Norway.

As established, this is typical of European countries, but not all jurisdictions are as strict. In Poland, for instance, retail traders can choose to trade with a leverage of 1:100.

What do you need to qualify to be designated as a professional trader in Norway?

In general, the requirements are in line with European regulations. That is, a trader is given three criteria, and at least two of the said criteria must apply to them for the broker to accept their application for a professional account.

The first one requires that one must have made substantial transactions in the previous four quarters, specifically ten per quarter. The second criteria has to do with a user’s financial instruments portfolio, seeing as it needs to be €500,000+ in size. Finally, having worked in the financial sector for a year or longer will also serve to make it possible for you to successfully upgrade your trading account to a professional status.

If you do qualify, you will be able to enjoy impressive leverage, which is one of the biggest advantages of being a professional forex trader. You might no longer be eligible for negative balance protection, however, as brokers are not required to grant it to non-retail traders, so this might need to be factored into your plans depending on your broker.

What trading platforms are available to Norwegian traders?

You can count on having a number of platforms to pick from should you decide to trade forex in Norway. Brokers that target Norwegian traders tend to offer multiple options, the first sometimes being their own proprietary software. Industry staples like MT4 and MT5 are also a common sight in Norway-friendly brokers, with users often given the freedom to choose one or the other depending on their preferences. Apart from the aforementioned platforms, cTrader, NinjaTrader, and TradingView may also be provided.

It should also be noted that pretty much none of the Norway-facing brokers are desktop-exclusive. If you need to be able to keep track of your account on the go, a mobile application will usually be provided.

As it is natural that some issues or questions may arise as Norwegian traders engage in forex trading, we have provided several sources we believe can be of great help:

1. The Financial Supervisory Authority (FSA): to be able to operate in Norway, forex brokers must apply for a license issued by the FSA, which is the official regulator of financial service providers operating in Norway.
2. To confirm the validity of an FSA license, you can head to the official regulator’s website and check the registry of licensed entities.
3. Forex brokers who wish to cater to Norwegian traders can also operate under licenses issued by other regulators within the EU and the EEA. Some of the most prominent regulators that indicate a safe and fair trading environment for Norwegian investors include CySEC, BaFIN, DFSA, and other bodies that fall under the most trustworthy category of tier-1 regulators.
4. Norwegian forex brokers are required to follow MiFID II directives implemented by ESMA, requiring all financial service providers operating in the EU and EEA countries to offer the highest level of protection for investors.
5. Visit this register occasionally to keep abreast of the latest market warnings issued by the FSA. This register also contains valuable information about clone firms and investment fraud that can spare you a lot of headaches.
6. Follow Finanstilsynet’s profile on LinkedIn for the latest announcements, events, and news from the regulatory body.