The future of the Russian market regulatory environment for providing licensed foreign exchange services continues to be blurry at best. While official legislation has been voted on by parliament and signed into law by President Vladimir Putin, the implementation of the new regulations is where difficulties are likely to persist for some time.
Forex brokers who are providing their services in Russia are not in a hurry to get licensed and comply with the new law passed by the Russian parliament late last year. With the supposed deadline looming around the corner in October, to date no license applications have been received by the chief regulator, the Bank of Russia. As feared, the industry doesn’t seem ready to comply with incoming regulations due to lack of clarity.
Industry representatives are discussing the possibility to postpone the deadline for implementation
According to information published by Forex Magnates Russia, industry representatives are discussing the possibility to postpone the deadline for implementation of the new law. Some industry insiders have shared with Russian newspaper Vedomosti that they hope that the new implementation deadline will be reset to the 1st of July, 2016.
According to a representative of the Russian central bank, the chief regulator is not against postponing the timing of the implementation of the law. Representatives of companies operating on the Russian foreign exchange market have been vocal about the shortcomings of the legislation. One of the major issues is that while forex contracts are getting regulated there is no word about CFDs.
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A representative of the Russian self-regulatory organization (SRO) CRFIN, Evgeny Masharov, shared that 15 of the biggest brokers who are members of the SRO are planning to get licensed. The remaining 13 are either going to merge into bigger entities to justify the costs or are going to be using the licenses of the big 15 regulated brokers.
The industry seems unprepared to get licensed so soon and the long-awaited regulatory framework is missing a clear statement from the central bank about its requirements from the brokers.
It remains unclear how the companies will transition to a regulatory framework
Confirming the above, the representative of the social trading brokerage eToro at CRFIN, Pavlo Salas, shared with Forex Magnates Russia, “It remains unclear how the companies will transition to a regulatory framework and what the requirements of the chief regulator (the Bank of Russia) to market participants are.”
“We remain ready to work in any regulatory framework that the central bank defines depending on its requirements – either as a representative of a foreign company, or registered as a foreign exchange broker in Russia,” he explained.