⚙️ SCA Category One License — The New Frontier for UAE Forex and OTC Brokers

Redefining Market Infrastructure in the UAE

The Category One License, issued by the UAE Securities and Commodities Authority (SCA), has long been known as the pinnacle of financial licensing — once reserved exclusively for market infrastructure providers such as exchanges, clearing houses, and central securities depositories (CSDs).

But the landscape is evolving.
Today, leading forex and OTC derivatives brokers are joining this top tier — operating under SCA Category One and setting a new benchmark for institutional-grade brokerage in the region.

At Alliance Advisers, we help forward-thinking financial firms navigate this transition — from strategy to submission — ensuring a compliant, well-structured, and future-proof licensing journey.

✅ Who Qualifies for the Category One License Today

While historically designed for entities managing market infrastructure, the SCA Category One license is now accessible to forex, CFD, and derivatives brokers that can demonstrate:

• Advanced risk management and clearing capabilities

• Strong corporate governance and independent oversight

• Sophisticated trading technology and post-trade infrastructure

• Proven operational capacity to handle systemic financial activity

This evolution reflects the UAE’s ambition to position itself as a global hub for regulated OTC and digital trading, where innovation and institutional control coexist under robust supervision.

✅ Permitted Activities Under the SCA Category One License

A Category One license holder may be authorized to engage in some or all of the following activities (subject to SCA approval):

• Operating trading and electronic execution platforms

• Dealing in OTC derivatives and foreign exchange spot contracts

• Clearing and settlement of transactions

• Providing custody, safekeeping, and depository services

• Managing post-trade infrastructure and surveillance systems

• Operating exchange-like trading or matching systems

This effectively positions Category One brokers at the intersection between brokerage and market infrastructure, giving them a regulatory edge and unmatched market credibility.

✅ Key Requirements for Obtaining the License

Because of its strategic importance, the SCA Category One License involves a comprehensive regulatory review and high threshold of readiness.
Applicants must demonstrate excellence across the following dimensions:

1. Capital Requirements

Substantial capital adequacy is mandatory, typically ranging from:

• AED 20 million for smaller OTC platforms

• Up to AED 100 million+ for full exchange-grade operations
  Final requirements depend on your business model, trading volume, technology, and internal risk systems.

2. Organizational and Governance Structure

• A UAE-based company with a physical mainland presence

• A board of directors including UAE-based representatives

• A licensed Category Manager and qualified Compliance Officer approved by SCA

• Clear reporting hierarchy and independent risk & audit functions

3. Compliance & Internal Controls

• Detailed AML/KYC frameworks

• Robust client fund segregation and reconciliation procedures

• Independent internal audit and regular compliance reporting to SCA

• Full documentation of policies, controls, and escalation procedures

4. Technology & Operations

• Secure trading infrastructure hosted within approved jurisdictions

• Cybersecurity, redundancy, and disaster recovery measures

• Comprehensive business continuity planning

5. Licensing Timeline

The full process typically spans 6–12 months, including:

• Legal incorporation

• Capital deposit

• Documentation submission

• SCA review and onsite inspections

• Final approval and license issuance

✅ Strategic Value of the Category One License

Becoming a Category One Broker is not just a regulatory upgrade — it’s a strategic transformation.

Advantages include:

• Institutional credibility with counterparties and investors

• The ability to host and operate regulated trading infrastructure

• Access to larger liquidity partnerships

• Preferential regulatory standing within the UAE financial ecosystem

This status demonstrates a firm’s long-term commitment to transparency, governance, and market excellence.

🔷 Why Choose Alliance Advisers

At Alliance Advisers, we have helped numerous brokerage and fintech institutions navigate the SCA regulatory environment.
Our specialists combine regulatory insight, technical depth, and local experience to deliver tailored support through every phase of licensing — from feasibility assessment to post-approval compliance setup.

We help you not just get licensed — we help you build a lasting foundation for regional growth.

🏁 The UAE Is Redefining What “Category One” Means — Be Part of It

The SCA’s approach reflects a broader vision:
A unified, transparent, and world-class trading environment where infrastructure and brokerage converge under the highest regulatory standards.

With the right guidance, your brokerage could be next to join the ranks of the Category One elite.