When thinking of foreign exchange (forex) trading, Saint Vincent and the Grenadines is not necessarily the first country that comes to mind. However, even though the island nation’s FX industry is small, there might be some big changes coming in terms of regulation.
In recent months, rumours have been growing that the local regulator in the country, the Financial Services Authority (FSA) will be implementing its own set of regulations, which at this point, similar to the situation in the Marshall Islands, has largely allowed brokers to self-regulate themselves.
As can be imagined, the lack of regulation has seen a number of bad actors set up shop within the country and tarnish the reputation of Saint Vincent and the Grenadines, which has prompted the government to act.
Tal Itzhak Ron, Chairman and CEO at legal firm Tal Ron, Drihem & Co. and Genia Gurevitz, who heads the Banking and Payments Services at Tal Ron, Drihem & Co, have confirmed to Finance Magnates that the FSA is planning on implementing new regulations.
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Changes are coming for Saint Vincent & the Grenadines
In particular, Tal Itzhak Ron and Genia Gurevitz, who help companies secure financial licences and banking facilities in Europe and offshore, told Finance Magnates that their office based in Saint Vincent and the Grenadines has confirmed they have been made aware that changes are coming for the country.
According to Ron and Gurevitz, the FSA is planning on establishing its own financial licence, which companies wanting to offer financial services from the island nation will need to secure before starting their operations in the country.
Therefore, with the introduction of the licence, companies operating within the country without authorisation will no longer be permitted. Currently, it is not clear when this regulation will be implemented, but it is expected to occur later this year.
However, a representative from the regulator has since reached out to Finance Magnates, clarifying that it will be reviewing its strategy as it relates to forex IBCs but there are no immediate plans to put regulations in place for entities conducting forex activities from this jurisdiction.
As Finance Magnates recently reported, the local regulator in The Bahamas, introduced a suite of new regulation including leverage caps, banning binary options and significantly increasing the fees for securing and maintaining a CFD licence in the country.