Australian Fintech firm TRAction has launched its trade reporting and monitoring services for CFD and FX brokers in the UK and Europe in a bid to help them with meet reporting requirements under the EMIR and MiFID legislation.
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The newly-launched services will also simplify the trade reporting process for those operating in multiple jurisdictions. Further, the firm intends to expand to other reporting jurisdictions to assist brokers in other markets in the near future.
If a firm works on its own, it needs to extract data from MT4 or other platforms and convert it into the format for the authority they are reporting to and interpret the legislation in the process.
In terms of the service cost, one of the key benefits of TRAction Fintech's offering is that all services are provided to clients with a reasonable yearly cap even if they get more support to meet extra compliance requirements. In practice, the broker end up paying for a year’s worth of trade reporting in the first month and then he gets the subsequent 11 months for free.
Sophie Gerber, Co-head of TRAction Fintech stated that even as we come up to the 3 year anniversary of the EMIR reporting start date there is still a fair amount of confusion in the market place.
Sophie stated two examples on how they can take on the whole puzzle in terms of the new OTC derivatives trade reporting legislation:
"1. Brokers assuming FX isn’t reportable under EMIR due to the spot FX exemption. FX derivatives (like that generally traded on MT4 or similar platforms) often do have their underlying price feed from spot FX. However they aren’t exempt as they don’t ‘settle’ and don’t meet the ‘commercial purposes’ test.
"2. Spread betting not being reportable because it’s gambling. Yes spread betting is gambling but it’s also a reportable OTC derivative if it is based on a reportable financial product. Basically if it’s reportable as a CFD it’s also reportable as a spread bet."
Background
TRAction Fintech is an Australian financial technology that offers reporting services such as trade data extraction and conversion, trade reporting, advisory and consultation. It works with companies in the margin Forex , contracts for difference (CFDs), binary options and commodities trade industries. The company is headed by Quinn Perrott, former executive at AxiTrader and Sophie Gerber.
