Alpari RU Leaving New Zealand as Regulations Grow

Aiming to contract its New Zealand operations as financial regulations in the country grow, Alpari has notified Apari NZ clients

Alpari RU (doing business through New Zealand company) has announced to clients that as of June 3rd, accounts in its FSP (Financial Service Provider) regulated subsidiary Alpari NZ Ltd will be automatically transferred to Alpari Limited, a non-regulated entity based in St. Vincent. In its letter to clients, Alpari RU stated that the change is in order to ensure that clients using the Alpari NZ subsidiary will be able to continue to have access to its “favorable trading terms, including tight spreads, accounts with no minimum deposit and a variety of deposit and withdrawal options.” They explained that the account transferring is due to planned changes from the New Zealand government, which will affect trading conditions of Alpari RU account holders as they stated “this transition is due to planned changes in New Zealand legislation that would force us to adoalpari logopt more restrictive trading terms and eliminate certain services which our customers currently enjoy.”

According to Alpari RU, clients interested in continuing to trade with Alpari RU are instructed to open an account with the broker’s new New Zealand subsidiary website alpari.co.nz, which replaces the existing alpari-forex.com. However, unlike the existing Alpari RU offering that has no minimum deposit level and has three account types, the new Alpari RU is limited to only MT4 ECN trading with a minimum deposit amount of $20,000. As account holders need to actively close their existing accounts and re-open one with the new subsidiary, along with the high minimum deposit threshold, Alpari is aiming to wind down the size of its New Zealand operations.

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As mentioned above, Alpari’s actions are due to expected changes in New Zealand’s financial regulations. Until recently, New Zealand had become a hot destination for forex brokers, being nicknamed the ‘Cyprus’ of Asia/Pacific. This is due to the ease brokers were able to register for a FSP license. The FSP regulation was created for foreign firms to be regulated in the country without the need of complying with the country’s full financial requirements needed by local based Financial Markets Authority (FMA) licensed firms. Moving to increase supervision, New Zealand has begun to implement stricter monitoring of its laws which recently led to the unregistering of 250 firms. In addition to broker’s requiring a staffed physical office on the Island, the FSP is also enforcing the filing of annual financial statements. There has also been talk that New Zealand may pass laws that would allow it to apply a ‘Cyprus’ style bank haircut on accounts to prevent future bank failures. As such, this combination of events have caused New Zealand to become a much less favorable destination for brokers whose goal is to be licensed in a loosely regulated, but Western country.

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