Over-the-counter currency markets are a pressing issue for the global economy. On the one hand, the trade turnover of even one large platform makes up a quite significant share in the investment pie. On the other hand, it is practically impossible to regulate speculative trading based on exchange rate differences. That is why regulatory organizations in the Forex market and today in most cases replace the officially existing systems of state control over the movements of foreign exchange markets. Who is the regulator? In fact, almost every country in the world has found its own solution to this problem. And the geography of the Regulatory Organizations (ROs) seems to be quite extensive, and you can verify this by going to this section.
Forex Regulatory Organizations: Foreign Experience
The United States has the most significant experience in regulating the Forex market. There are several regulators here, the main of which are: NFA (National Futures Association) and CFTC (Commodity Futures Trading Commission), an organization founded four decades ago and, in fact, an independent version of the federal agency. It is worth noting that it is in the United States that market regulators have the greatest influence on Forex traders, setting restrictions and prohibitions on some aspects of their activities. But at the same time, despite the use of such unpopular measures, it is the North American associations, in particular, the NFA, that have the greatest authority in the world of trading.
The UK market also has its own regulator – FCA. And since this state is a member of the EU, it is most often addressed to it to resolve various controversial or fraudulent situations in the foreign exchange market recorded during over-the-counter currency trading in the countries of the Old World.
However, the Forex market is somehow regulated in any country – even if it is purely nominal. You can find the full catalog of RO.
Forex Regulators: How is it with us?
As for the Russian Federation and the CIS countries, everything is much more complicated, since forex trading is legally removed from the scope of activities subject to state regulation. By default, it does not seem to exist; legal disputes are settled on the same conditions as the bet. And brokerage in this area in most cases is carried out under the strange wording “the provision of information services.”
If we consider the existing organizations as able to streamline the situation in the foreign exchange markets, the FSFR (Federal Service for Financial Markets), which was replaced by the Bank of Russia Financial Markets Service, was closest to this in terms of its intended purpose. But it is precisely in the absence of a clear legislative framework that the Forex market simply does not fall within its sphere of influence. On March 3, 2014, the Bank of Russia Financial Markets Service was abolished
There are also “private” regulators on the Russian market – CROUFR, KROUFR, and others. But, as a rule, they work in direct contact with a rather narrow segment of the market and do not cover it entirely. And any recommendations of such regulators are optional.
However, the Central Bank is the most important regulator of any financial issues in the Russian market. It is he who controls the activities of banking organizations that provide a number of brokerage services to their customers. And it allows you to resolve any disputes at the official state level.
Forex Market Regulation: Expectations and Prospects
It is worth noting that the Forex market has long been an object of close attention from numerous Russian officials of the highest rank. And in the very near future, a law is expected to be adopted, which will finally help to clarify the activities of traders, brokers and over-the-counter turnover of foreign currency in general.
In 2013, the State Duma of the Russian Federation already considered in the first reading a draft law on the regulation of foreign exchange markets and, in particular, Forex. But its final consideration was delayed due to the need for a substantial revision of the submitted documents. It is expected that the bill will be re-examined before the end of 2014. And this means that traders have a chance to enter the new fiscal year with a new status and new opportunities. In particular, with the right to consider controversial situations regarding trade on the OTC market in the framework of arbitration proceedings.
Well, of course, the main goal of the adoption of the draft law is not just the emergence of mechanisms for regulating the foreign exchange markets, but the creation of working conditions in which unscrupulous brokers simply will not have a place in the system. So, in particular, it is supposed to create conditions for market self-regulation by creating a single organization for all dealers acting as Forex intermediaries. At the same time, a contribution system should be working, which involves paying a membership fee (about 30,000 USD) and monthly fees (about 10,000 USD).
In addition, it is planned to create not only a unified legislative framework, but also a fund that will protect the interests of traders from the unfair behavior of brokers. The size of the entry fee to such a fund will be about 50,000 USD.
In the meantime, Brokers.ru offers its visitors an alternative opportunity to file a complaint with the broker. To familiarize yourself with the service, go to the “Send a complaint” section.
Learn more about how to influence a dishonest company in the article “ What gives a complaint about a broker?”.
However, today most of the major dealing centers are trying to adhere to a number of rules in the course of cooperation with their clients. And this serves as a kind of mechanism for market self-regulation, which today is a disparate structure that requires global legislative streamlining.