Bank of Russia is considering new rules for overseas Russian Forex Brokers websites. Will this be the end of overseas Russian Forex brokers?
20 February, AtoZForex – The new law on Forex doesn’t seem to affect the activity of overseas Forex brokers, yet the Bank of Russia considers changes in the requirements for their Russian websites.
Forex industry in Russia
The Forex sector in Russia got officially started in December 2014 after the Russian president Vladimir Putin signed the profiling law. The guidelines and strict directions are intended for the Forex organizations that are willing to provide their services to Russian customers, to set up a business in Russia or to get a license of Forex dealer.
One of the requirements, set by the governing bodies for Forex Brokers is the comparatively high net capital requirement of USD 1.74 million. This has strapped some Forex brokers to pursue alternative ways. Most importantly, only six companies have got Russian FX dealer licenses. These include Alpari Forex, VTB 24 Forex, Teletrade Group, TrustForex, Finam Forex, and Forex Club.
What about the other Forex brokers in Russia?
They have left the Russian market, that is, quit overhauling Russian demographic and shut their branches in the nation. Others kept on offering administrations to Russian customers from other jurisdictions. The last year data showed that the Bank of Russia received 210 complaints by the clients against Forex companies, which have registration overseas. Thus, this is somewhat less from the 236 complaints received in 2015.
New rules for Overseas Russian Forex Brokers websites?
Vladimir Chistyukhin, the Deputy Governor of the Bank of Russia quoted that the objective of the Bank of Russia is to shield the Russian Forex clients from non-exposure of data and deceitful activities of Forex organizations. However, with respect to foreign organizations, the regulator has less power. Therefore, Mr. Chistyukhin believes that the Bank of Russia needs the support of foreign financial regulators.
Reportedly, the Russian regulator is currently considering establishing requirements for the overseas Forex companies’ websites targeting Russian clients. Also, Vladimir Chistyukhin said that they can only block websites in case their page content does not follow the law.
Hence, the Forex companies within Russia continue to fight with the administrative burden of unsuited rules and regulations. Therefore, the final goal is to clear is designing and executing the common standards for Forex dealers.
About the contributor
The industry news about the Bank of Russia was provided by Venkatesh Endugu. If you like the article, give credit to the author in the comments section below.