[updated August 2017]
The drama surrounding Israeli new law regarding binary options goes on. Even though it will be impossible to implement the new law (in case it is actually voted) until first trimester of 2018, it is already facing great level of pressure from coalition members of the Israeli government.
David Bitan, ruling chairman of Likud party that holds the majority in the ruling coalition, requested some changes to be made in the law. Bitan holds the power to approve special Knesset sessions, and it is presumed that such could be requested due to the reputation of binary options in Israel. However, it is important to mention how mr. Bitan showed up at the meeting accompanied by SpotOption CFO Moshe Avrahami. SpotOption is the leader in segment of binary options software that could also be banned by the new law.
The new binary options law bans not only binary options brokers, but all services involved in binary industry: software providers, call centers etc. Bitan also gave statement to the press that he won’t approve a special Knesset session, just to vote on binary options. He explained that this voting is not urgent and can wait for October. After pompous announcements by ISA chairman Shmuel Hauser that binary options will be made illegal – there are great chances that such thing won’t happen, as according to the rumors Bitan holds more power than it is officially visible.
Can Binary Options Ban Bring any Good? Belgium’s Ban Causes more issues
Belgium was one of the first countries that banned binary options and other leveraged trading products completely in the summer of 2016. However, the results were not what they hoped for. FSMA issued a report in which it lists nine binary brokers that are offering binary options to Belgium citizens. Even though the ban in Belgium is not official, no broker received a license since last summer when great war against leverage products was announced.
Belgians are now facing new risks, as the market is overflooded by brokers who have no license and whose real status and owners are hard to track. Binary trading scams are becoming more than common in Belgian market, and FSMA as always, issued a set of guidelines on how to recognize a scam.
As always traders should check the broker’s status, reputation, and read the review. However, considering that many scam brokers can be very convincing the lack of local regulation didn’t bring any good to Belgian traders. Unregulated brokers, which often operate as clone companies, really don’t care about regulatory framework and tend to prefer ‘take the money and run’ approach.
Many believe that similar scenario awaits for Israel, in case the new law is voted.
[updated July 2017]
According to the reform committee of the Knesset Parliament, which was convened on Monday, many were surprised with the discovery that the draft law, which was issued in February, is visibly weakened. The original text produced by the State Attorney’s Office along with Israel Securities Authority should have banned the entire binary options industry. It is also foreseen that all online business operations in Israel and abroad must have mandatory licenses in the country in which they operate. In the months that followed, the original text has been changed, and in the new version approved by the government, many segments that cover other financial instruments have been deleted. It is also reported that according to the new version of the law, binary companies can adjust their financial products and thus circumvent the fines.
The binary options industry in Israel has estimated between $ 5 billion and $ 10 billion annually, and more than 100 companies employ over 5,000 workers. We have to remind you, as we have already told you, that the law must return to the reform committee to the second and the third reading to become law. We will surely keep track of all binary-related events in Israel and promptly report them to you!
[updated July 2017]
Fairbinaryoptions.com has discovered that Israel’s new Binary Options law, banning the operation of a Binary Options will not be passed this year. The Knesset Parliament, which needs to make a decision, goes on a summer break. Considering that the laws in Israel can become effective three months after the passing of the bill and the earliest session of this parliament is expected around October 20., the law can become effective no earlier than the end of January 2018.
Also, there is information that lobbyists in the Knesset Parliament want to slow down the coming of this law in order to regulate, and not to ban the binary options. The idea is to handle binary options similar to Forex and CFD products. We are also aware of the fact that most binary options companies have moved their business abroad and are trying to reinvent themselves as FX, CFD, and/or cryptocurrency brokers. As has been said so far, the law is considering that the punishment for violators of this law will be up sentenced up to two years in prison. Also, it will likewise be viewed as a contradiction of Israel’s law for illegal tax (AML), which can carry different consequences such as fines and imprisonment.
Israel Binary Options Law Passes First Reading With 31-0 Vote
The latest law by which Israeli legislation wants to ban trading binary options in Israel and ban services to foreign clients is on its way to becoming a valid law. After a brief hearing in parliament, the law passed the first statement and the vote was in the ratio of 31 to 0 for this law.
Representatives, after a brief statement, had the most frequent comments on how the entire process should be better regulated and that legislation should be extended to other investments that citizens can use. The next steps, with regard to voting, are likely to lead the law to the second reading of the law before approval has to pass a certain process of deliberation.
The Knesset’s Finance Committee makes a decision during the vote, however, with a score of 31-0, it is expected that the law will be backed up immediately after the third reading, which is the Israeli Parliament’s obligation.
Any mediation in binary options such as providing software services to launch this business, providing payment transactions for trading, marketing, customer contact or customer service may be punishable by up to 2 years in prison, as well as with various financial warnings.
Bearing in mind that the law needs to have two more readings and votes of the Financial Committee before the summer break starting on July 31, the law can become formal only 3 months after. This means that the earliest ban on binary options in Israel will not come into effect by the end of September or the beginning of October.
AnyOption, StockPair, 24Option, and Leadtrade Stops Offering Binary Options
The Invest.com has announced that AnyOption terminates activities related to binary options. With new changes, the company will from now offer structured products, portfolio management, stock trading and CFDs.
This unification is now awaiting CySEC’s decision as the Invest.com will consolidate AnyOption’s assets in a way that will work on setting global licenses, including CySEC, check all regulatory and compliance procedures and keep personnel experienced in online marketing.
Itai Avneri, the future CEO of the merged group says: „We know that the cooperation between the companies and new product offering will increase value to our three million customers and will continue to lead the industry with high expectation for professionalism, product, regulation and customer service.“
Back in 2014, the domain Invest.com was paid $5 million in order to come in the forex industry. Invest.com has launched management website in May 2016.
Also, this week, online brokerage company 24option will leave the binary options industry. The company will not accept deposits from new traders in the Europian Union from next week and some limitations will include new clients from the rest of the world.
According to the 24option, operations will expand and focus on forex and CFDs trading. New traders of 24option will only have the option to deposit into a forex or CFDs account. This is new strategy focus, and 24option launched its Forex and CFDs trading products two months ago. At the time, 24option announced Alpesh Patel as brand ambassador. He is a great analyst and former columnist at the Financial Times and Bloomberg.
StockPair and Leadtrade Ltd. about Business Policy
The news spreads fast with Stockpair broker also. An online broker is undergoing an optimization process of its company which unfortunately includes a dozen of employees removed from its work, as Finance Magnates has confirmed. The reason is the same, they are trying to readjust to the regulatory demands in Europe.
A company representative said: „Because of the regulatory changes and market conditions, Stockpair had decided to restructure its operations and acquisition of new clients. This business model will better fit the market demand and all regulatory requirements.“
Also, due to the changes in the company operations, the company is avoiding new client traffic from affiliates but expect to have a new discussion about future collaboration. There will be no change in the monthly commission’s payment and their marketing department is at your service for any questions.
The last operator involved in this whole story is Leadtrade Ltd. This operator of multiple binary options broker brands is pulling out of binary options also. CySEC lately gives a suspension on Leadtrade because of a violation regarding funds and CAD which stands for Capital Adequacy Ratio. However, CySEC later withdrew its suspension because everything was according to the law.
Leadtrade had provided services with this domains:
The Leadtrade will remain under CySEC supervision and as we know, Optionsclick, TopOption and Prestige options are inactive and offline for two months already. This does not mean that the binary options will be removed from the market and will no longer be available for trading but will be regulated in a different way by changing the specific laws and countries to which these laws apply. FairBinaryOptions.com advocate signup with the top ranked brokers on our site. Our reviews and brokers check will help you choose the best and regulated broker that is appreciated on the market and among the traders.