Russia’s State Duma Approves Forex Legislature in First Reading

In Russia, Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term regulation is becoming a matter of ‘when’ and ‘if’. The latest example was an announcement from the CRFIN that Russia’s State Duma approved a legislative draft in regards to forex regulation in a first reading yesterday. CRFIN is a non-profit self-regulated organization (SRO) that was founded by forex broker executives with the aim of having retail OTC forex included within Russia’s financial regulation. The group includes participants from Russia’s largest brokers such as Alpari, Teletrade, Exness, and Forex Club. The SRO is the successor to KROUFR which is one of the oldest industry groups, but has recently become less relevant as members have left the organization.

According to the announcement, the approved draft (249583-6) was created with support from CRFIN with the aim of regulating OTC forex. Highlights of the proposed rules are;

• Forex Dealers are classified as licensed entities in the Russian Federation which hold customer assets and will be required to become licensed members of the DSRO and fulfill ongoing compliance of the regulator
• Forex dealer will have a capital requirement of 35 million rubles ($1.08 million)
• Rules governing information disclosure, internal controls, personnel certification, Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term and dispute resolution. Provisions also specifying stability and disaster recovery plan.
• Legislative draft also sets the requirement to have publicly open terms and conditions that clearly specifies dealer’s pricing policy, orders execution and other major business terms.
• The proposed draft also included the ability for investors to have the right to assert claims against forex dealers in court, as well as state rulings in regards to taxes.

The passing of a first reading is the latest in the quest of forex regulation in Russia. The desire to have the product regulated has been primarily driven by brokers looking to add credibility to forex trading following multiple cases of customer fraud. Attempts of regulating forex began over four years ago.