Jan 02 2022 0
When you start investing in the forex market, one of the most important decisions is the choice of an adequate online broker. An online broker is an intermediary company that will be responsible for executing the purchase and sale transactions that we request and in which we will have to deposit the money with which we are going to operate. And today, we will tell you a bit about the FxPro regulations.
It is vitally important within the trading platforms such as FxPro, as with any Internet investments, that they have a regulatory body that guarantees security and guarantees. For example, that the broker we are going to hire is 100% reliable and won’t get away from unnecessary risks and fraud.
Currently, trading with binary options is asking for more control by many governments. So, the CySEC is making changes, starting a process that toughens the requirements for a broker to apply for a license to operate. It has become a much stricter body.
FxPro ensures that all the work carried out for clients is carried out under the highest professional and ethical standards. The company acts on the legislation, regulations, and codes of practice existing in the territories in which they operate.
FxPro has general policies for the conduct of employees. There is a self-certification process under which all employees must indicate that they have complied with the terms of the Code of Conduct and the Code of Ethics.
Also, all employees must comply with the following company policies: Conflicts of interest, Transactions with related parties and Informants.
These policies reflect the strictest legal and regulatory requirements applicable to FxPro and are adopted globally throughout the group.
Below, you will find the main supervisory and regulatory agencies of the FxPro. The regulation and supervision of financial markets are of vital importance. Each State usually regulates, through specialized agencies, the different financial activities
The Financial Regulatory Bodies are the public entities in charge of ensuring that companies comply with the legislation in force, and they also maintain control over the development of the activity.
Financial Conduct Authority (FCA)
FxPro has a license and is regulated by the Financial Conduct Authority. The FCA is a leading, independent and non-government body with statutory powers under the Markets and Financial Services Act of the year 2000 in the United Kingdom. It is the most important regulatory authority in the United Kingdom and one of the most demanding worldwide. It was created in 2013 as a successor to the activity of the Financial Services Authority (FSA) and currently oversees more than 50.000 companies.
It regulates all aspects related to the commercialization of financial products and ensures transparency and investor protection. It has the authority to temporarily or permanently prohibit any financial product that it considers abusive or deceptive.
The main objectives of the FCA are: to protect consumers, improve the integrity levels of the financial system and promote competition with the interests of consumers in mind.
As a fully authorized company, FxPro ensures compliance with the requirements of the FCA.
Cyprus Securities and Exchange Commission (CySEC)
FxPro is also regulated and licensed by the supervisory and regulatory authority of investment services firms in Cyprus. The Cyprus Securities and Exchange Commission (CySEC) is a member of the European Securities and Markets Authority (ESMA).
FxPro holds an international license from the CySEC that authorizes you to provide investment services. They make sure to comply with local and EU regulations such as the Financial Instruments Markets Directive (MiFID) and the Cyprus Investment and Regulated Market Services and Activities Act of 2007.
Within these regulatory bodies, the Cyprus Securities Commission, the CySEC, is one of the most recognized due to its strict measures and controls when deciding whether or not to authorize an operator or provider of financial services online.
When we meet with a broker with an accreditation of having met the requirements of this commission, we will have a much greater guarantee and security.
Within the binary options market and FOREX, this is something essential due to the high fraud risk involved in online trading. If we already operate without care through the Internet we are exposed to deception even with a simple purchase.
Working with financial assets, the concern is capital since we are playing with our funds.
Financial Instrument Markets (MiFID)
The Directive on Markets in Financial Instruments (MiFID) came into force with the objective of regulating the markets of financial instruments and the provision of investment services and activities within the European Economic Area (EEA). The Directive was adopted in Cyprus through the Investment and Regulated Market Services and Activities Act of Cyprus in 2007.
The main objectives of the Directive on Markets in Financial Instruments (MiFID) are to increase financial transparency, improve levels of efficiency, promote competition, and protect consumers effectively.
Also, MiFID allows investment firms to give the client investment services in the territory of another member state or a third country, provided that such services are covered by the authorization of the investment firm.
Financial Services Board (FSB)
FxPro is authorized and regulated by the South Africa Financial Services Board (FSB). It is the body responsible that ensures the entities it regulates comply with the legislation that corresponds, as well as with the capital adequacy requirements to promote the financial soundness of these entities and, thereby, protect the investment community.
The FSB is the independent regulatory, supervisory authority of the non-banking services industry in South Africa. It has the power to enforce infractions through the application committee.
The Committee may impose unlimited penalties, compensation orders, and cost orders. These orders are enforceable as if it were a judgment of the Supreme Court of South Africa.
Investor Compensation Fund
FxPro is a member of the Investors Compensation Fund, whose objective is to guarantee any claim of covered clients against members of the Fund.
To compensate the clients for the claims arose from the malfunctioning of a member of the Fund when complying its obligations, whether that obligation stems from the legislation, the agreement with the client or from an offense by the member of the Fund.
Is it good to have many regulations?
We can see that FxPro has upto 4 regulations. Does this make FxPro more reliable than other brokers who just have 1 or 2 regulations? The answer is no. The number of forex regulations doesn't stand for the credibility of a broker. A regulation of one country protects only the traders in that country. For example, a broker with US, UK, Japanese, and Australian regulations cannot protect a Thai trader. That's why you shouldn't pay much attention to the number of regulations. One top-level regulation is all you need to make sure that broker is reliable. More regulations just mean more limitations.
Who else are regulated by CySEC and FCA?
FCA and CySEC are among the best forex regulations in the world. Brokers who are regulated by them are very safe and reliable. The question has to be asked: Is FxPro the best FCA-regulated broker (or CySEC-regulated)? The answer is no. There are better brokers than FxPro who are also regulated by CySEC and FCA. They are Exness, XM, and HotForex.