Brexit changed a lot of things, including the way financial service providers can operate in Europe. To help you get to grips with what the changes mean for you, here are the answers to some of the common queries raised by the clients and partners of currency transfer providers.

These answers were last updated in March 2023.

Is it true that FX companies that are solely authorised by the FCA can operate in Portugal without being authorised by the Portuguese authorities?

This is a very common misconception. When the transition period ended, UK-based financial services companies lost their passporting rights - meaning they lost the ability to operate in the European Union unless they were regulated by a relevant EU provider. If a firm is soliciting and working with clients based in Portugal, they must have an appropriate EU licence.

A Portuguese estate agent referred me to a currency provider that’s authorised by the FCA. As I’m a UK resident, will I be protected if I use them?

If you’re being referred to a currency provider offering services outside the UK, you should check that they have the appropriate licence to operate in the relevant country. If the firm is operating in Portugal, they should be authorised by a relevant EU authority like the Bank of Portugal – FCA regulation by itself may not be enough. When using a new company, it’s important to check their licence permissions, how they protect client funds and what support you’re entitled to from a local regulator if anything goes wrong.

My FX company tells me they are FCA protected and do not need an EU licence as all the trading is done in the UK and their Portugal office is only for marketing purposes. Is this accurate?

No, this is not the case. As above, a company that offers services in EU countries like Portugal has to be licenced by a relevant EU authority, such as the Bank of Portugal or Bank of Spain. If they only have FCA authorisation they should not be offering services in Portugal or other countries in the EU.

I have heard my FX company has an EU licence but there is nothing on their website and I can’t find any EU licence number when I search them on Google.

If your FX company has an EU licence, they should display details of who they’re authorised by and their licence reference number on their website. If they are not, contact them directly and ask them to share their licensing information with you. Any company which has the correct authorisation should be happy to share this with their clients, so if they’re unwilling or unable to provide proof of their EU licence, this may be because they do not have one and are therefore not authorised to provide FX services in the relevant country. If they claim they are authorised but have not listed their reference number, you should always ask which EU country has licensed them and check with the local financial regulator in that country. Almost all financial regulators publish the names of companies that they have approved to operate.

I live in Portugal but have sent my funds to an FX company that is authorised by the FCA as an Electronic Money Institution. They’re holding my funds on account while I wait for the exchange rate to improve. Am I protected by their FCA authorisation?

Technically, if you’re a Portuguese resident and register with an FCA regulated company offering services in or from the UK, you are afforded the same protection by the FCA as a UK resident. However, a UK firm should not be soliciting business in Portugal without an appropriate EU licence and you should check their status.

I’ve been told that FX companies in the UK that don’t have a branch or other establishment in Portugal do not need an EU licence and can still solicit referrals via estate agents and lawyers in Portugal.

This is not the case. Any company soliciting referrals in Portugal must have a relevant EU licence.

I only do our clients´ legal/tax/house purchase advice and the FX company I refer to deals with the client payments. They must have all of their licences in place, they are the experts, aren’t they?

You should never assume that a financial service provider has the licences they need to operate and service clients in Portugal. Always check their website to find out which organisations they’re authorised by. If you can’t find the information you need, ask them to share their licence credentials. You should also check what measures they adopt to protect client funds, what safeguarding protections are in place and what recourse you have available to you if things go wrong. It’s important to check that the bank account you are paying into is a segregated client account and protected under a trust arrangement in the event the FX company becomes insolvent or financially distressed.

My Portugal-resident clients are protected as the FCA regulates the currency provider they’re using. If clients make a complaint, the UK Institutions (i.e.. the Financial Ombudsman Service) will provide adequate support to my clients.

Individual clients based in Portugal and the wider EU will still be able to raise complaints with, and benefit from the support of, the Financial Ombudsman Service provided the relevant FX company was providing services in or from the UK. The client’s nationality or country of residence won’t matter. Note that the FX provider must protect client funds by paying them into segregated client accounts. However, if a client uses a company without the correct EU licensing, they may not be protected if they wish to seek the support of their local in-country regulator.

We hope this helps clear up some of the confusion around the licensing of financial services companies post-Brexit, but here are our key takeaways:

• A financial services company can only offer services in Portugal if the company is regulated by a relevant EU authority, like the Bank of Portugal, Bank of Spain or Bank of Ireland

• If a Portuguese estate agent or lawyer etc. is referring a UK resident to a currency transfer provider, that provider can’t offer services in the EU without a relevant EU licence.

• FCA authorisation/regulation does not by itself allow an FX company to do business in Portugal and the wider EU.

• If in doubt about a company’s licence, check it out! Always verify that they have the licence they need to work with you or your clients. You can check if a company is authorised by the Bank of Portugal here:

• You can see details about companies involved in unauthorised activity on the Bank of Portugal website: