Forex Trading in Australia – Features and Characteristics

The Australian Securities and Investments Commission is the only regulator in the country. The commission is in charge of monitoring the activities of financial markets, companies and enterprises. ASIC also oversees all financial transfers for purchase and sale transactions, investment, pension and deposit funds. The regulator collects information about companies and individuals involved in the provision of consulting services in the above areas.

ASIC functions

As a market regulator, ASIC assesses the quality of work of structures and their compliance with the legality and openness of activities in the market. At the same time, the commission has the right to make recommendations to the minister regarding the authorization of new markets. Since August 1, 2010, the Securities and Investment Commission has had the right to control trading operations in the domestic securities market, financial instruments and futures contracts. ASIC also licenses companies that provide financial services in the field of pension and insurance payments, fund and derivatives managers, stocks and securities.

The ASIC is responsible for detecting fraud. One of the most important functions of the regulator is to monitor the absolute transparency of transactions carried out in the Australian markets. The organization enjoys the right to check the legality of all operations carried out.

ASIC also licenses the majority of FX brokers in the country. One of such brokers is FPMarkets. You can have a closer look and obtain all the necessary information in this reliable FPMarkets broker review available on a prominent website.  It’s also worth noting that without the following license it is highly likely to encounter a scam.

ASIC is confident that the promotion of international activity and the integration of international markets will bring tangible benefits to the Australian market as a whole, providers, investors and consumers. The most promising, in their opinion, is the Asian region. The recognition of the principles of regulation of ASIC retail trade in derivatives by the US and EU authorities allowed them to avoid many costs in resolving claims.

ASIC history

ASIC has existed since 1998, but the organization received the functions of a regulator from the Central Bank of Australia in 2001 after the adoption of the Financial Services Reform Act. Until that moment, there was no single regulatory system.

To track violations in the markets, for example, the use of insider information and manipulation, the commission’s specialists use the IRESS service, which processes information online. The system monitors all company news, capitalization, indices dynamics, options analysis. The information received is subsequently subjected to careful analysis. The organization has broad powers to bring violators to justice.

Obtaining FX License in Australia

Obtaining a brokerage license in Australia is a procedure that must be followed by anyone who intends to start trading on the Forex market in this jurisdiction. To obtain permission to conduct brokerage activities in Australia, the applicant must fulfill a number of requirements.

The obligation to license brokerage in Australia is regulated by the Corporations Act. As a rule, the transactions carried out by brokers in the Forex market fall under the classification of financial services. Therefore, if you intend to trade in Forex, you will need to apply for an Australian financial license.

In order to enter the Forex market in Australia, you need to apply for licensing with the Securities and Investments Commission (ASIC). The Australian Securities and Investment Commission is authorized to regulate and license Forex brokers based in Australia. The ASIC’s responsibilities include:

• Accepting applications for obtaining an Australian forex license;
• Australian Financial Services Licenses (AFS);
• Conformity assessment of applicants;
• Forex licensing of Australian companies or rejection of applications;
• Control of licensees’ compliance with legislation and strict rules of conduct;
• Revocation of permits and sanctions in case of non-compliance with the established requirements.

Final Words

Registering a Forex company in Australia and obtaining an Australian financial services license are the steps to be taken to start a brokerage business. However, applicants need to carefully study the requirements put forward by regulatory authorities and current legislation.