CySEC to Supervise Binary Options Trading in Cyprus
CySEC, the Cyprus Securities and Exchange Commission, has announced its intention to begin regulating binary options brokers.
CySEC officially announced on May 3 2012 that the provision of Investment Services with respect to Binary Options falls under MiFID and shall thus be supervised from now on by CySEC.
The announcement comes after approximately two years of advocacy by MAP S. Platis, a consulting and advisory board that works closely with financial institutions in Cyprus, Russia and the European Union.
Until recently, it was unclear whether binary options fall under the scope of MiFID and whether companies offering binary options should be regulated by the competent financial services authority of each EU Member State in which they operate. The majority of EU Member States did not have a clear policy on the treatment of binary options trading, while other Member States such as the UK, treat binary options trading as gambling.
This means, that all entities that offer investment services related to binary options must now submit their applications to CySEC, in order to obtain a license to operate as a Cyprus Investment Firm (CIF), otherwise they should cease their operations.
MAP S. Platis has noted that at least 3 binary options brokers have so far applied for binary options regulation with many more expected to follow.