Belgian Watchdog Asks CySEC to Request Cyprus Firms Report Operations

All Cyprus investment firms operating in Belgium are urged to get approved by the FSMA, or immediately cease offering services

Belgian financial regulator, the Financial Services and Markets Authority (FSMA), has repeatedly issued warnings against the activities of various providers of binary options and forex engaging in unauthorized activities in Belgium. Now the watchdog is taking action against locally unauthorized firms on another level by contacting the regulator of another jurisdiction and asking to keep its house in order.

Today, the Cyprus Securities and Exchange Commission (CySEC) sent a note to all Cyprus Investment Firms (CIFs) providing investment services relating to binary options cross-border into the territory of Belgium, drawing their attention to the Belgian investment regulation law. CySEC specifically mentioned that this was done upon request of the FSMA.

According to the relevant Belgian law, any public offer of investment instruments made in the territory of Belgium is subject to the obligation to publish a Prospectus. CySEC notes that, in order for any CIF to offer cross-border services in Belgium, the said CIF should take all necessary steps to ensure its compliance with all respective laws, rules and regulations that govern the provision of investment services and activities in the said jurisdiction.

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Therefore CySEC says, in the event that a CIF offers cross-border investment services relating to binary options in the territory of Belgium, such CIF is urged to immediately proceed to the issuance of a Prospectus which must be approved by the FSMA, as per the provisions of the Belgian law, or immediately cease offering such services in the territory of Belgium.

There was no mention in today’s note of any measures that the regulator might take against CIFs in the case they continue to offer unauthorized services in Belgium. However, as FSMA is evidently much more active in its approach to such matters, going beyond the minimal warnings most regulators publish, it can be assumed that it would demand that CySEC fines CIFs who don’t comply next.

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