Forex Trading Regulations Around the World – the Full Breakdown
Finance Magnates Intelligence maps out the global regulatory environment for forex trading.
Following up on our popular recent feature global binary options regulations overview, we are proud to present you with a detailed breakdown of leveraged currency trading regulations around the world.
The importance of getting a forex license today cannot be underestimated as traders are more aware than ever about the risks associated with unregulated firms. Brokers on their part are strongly emphasising, even in countries where it is not required, how many jurisdictions they are licensed in and trying to get more established signs of approval.
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Finance Magnates Intelligence analysts have mapped out regulations relevant to forex brokers and traders by country and we visualised it in the form of regional maps.
In North America, home to some of the biggest forex brokers in the world, trading is highly regulated and regimented. The high costs associated with getting approved to offer services make the market very hard to break into. It has been consolidated to a degree unseen in markets of its immense size with just a handful of companies remaining to legally serve North American clients.
In South America, Chile offers a forex trading license for firms approved by the SVS (Superintendencia de Valores y Seguros). Brokers are reporting growth throughout the continent which is developing as a new high target market.
One of the most advanced and developed markets on the continent, South Africa offers a forex license regulated by the FSB (Financial Services Board) which is highly respected in the region.
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Make sure to also check out the recent Global Binary Options Regulations Overview
In the diversified markets of the Middle East, Cyprus remains the top destination in which to establish a legal presence. A gateway to Europe and a regional hub, Cyprus is one of the leading international forex jurisdictions.
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One of the biggest retail forex markets by its own right, Japan remains an island onto itself with regulated online brokerage groups targeting traders in neighboring Asian countries based on Australian, Hong Kongese and even UK licences.
Despite a growing focus on developing markets recently, Europe remains the leading region in terms of the number of markets welcoming forex brokers while ensuring trader safety. A European license is often the most sought after by firms that operate in markets where a local legal framework is not available.
A number of national regulators in Europe have also recently issued specific guidelines for conducting business under their jurisdictions. These include additional client protection measures in Spain, an advertising ban in France, a distribution ban in Belgium, a CFDs advertising ban in the Netherlands and a new minimum deposit and maximum leverage requirements in Turkey.
Where does your jurisdiction stand regarding CFD trading? Finance Magnates Intelligence has mapped this out too.
It’s important to remember that the situation can change from time to time. The maps offer a snapshot of the market as it is in March, 2017. Keep following Finance Magnates to stay up to date with the latest developments.
Thanks for the insight, the forex industry is really evolving, personally I think regulation is a good thing but at the same time global regulators need to respect FX trading as a legitimate investing vehicle. I read a similar article on BSS about the regulatory biddies in each country. Getting to know the regulators and how to work with them is the next step for brokers and investment companies.
Good article.
I believe Cyprus is probably the only country, that leads in terms of accommodating the MetaQuotes brokers.
Israel had a bustling BO job market, but that is now emigrating. But, I know for sure, that any new technology that powers the financial sector will trace its source back to it, directly or indirectly; the country is not at all short of innovative ways to tackle its problems.
The UAE, because of its tax-free nature, looks promising, too.
No info on Indonesia? I’ll give. It’s green, Forex allowed with restrictions. There are many local companies work as forex brokers here, also some foreign ones that operates without local licenses. Local law is under Law Number 10/2011 About Commodity Futures Trading (UU No.10 Tahun 2011 Tentang Perdagangan Berjangka Komoditas). In general, the govt blocked access to some foreign brokers because they’re unlicensed and the govt itself refuses to give license to foreign brokers, but internet blockings are kinda “negotiable” ifykwim.
most things are ”negotiable” in indonesia dear. in terms of website blocking: firms create new domains
I’m proud to have Indonesians here. 🙂
In terms of Latin America, Uruguay is actually one of the most developed countries for regulated FX brokers. There is a clear set of rules a company should follow in order to provide regulated services. The brokers are regulated by the BCU (Banco Central del Uruguay) and there are some brokers in the possession of the regulation, XTB for example.