Last year it was reported that the Japanese FSA (JFSA) had notified brokers to cease marketing new binary options products as it was working on creating rules to regulate the product. Areas that the JFSA were focusing on are hedging solutions for brokers, disclosure rules, daily customer trading limits, and expiration periods. The JFSA’s review is being made in conjunction with the Financial Futures Association of Japan (FFAJ), a self-regulating supervisory body .
With binary options currently an unregulated product, the JFSA is concerned that many offerings closely resemble gambling, which the regulator would like to limit. According to Japanese news site Jiji Press, the JFSA is in the final stages of creating its proposals with a planned summer implementation of the new regulation. In the Forex Magnates Q1 Forex Industry Report, Japan’s pending regulation was discussed at length with binary options providers. Firms expressed to Forex Magnates that Japan is a key market for them and therefore they were taking a proactive approach to create solutions that will comply with the new rules as soon as they are released. Provider, Tradologic even explained that they were working with the Japanese FSA to assist them in developing criteria with which to regulate binary options platforms.
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