Bank of Russia makes next step towards blocking websites of overseas FX brokers - FinanceFeeds

Bank of Russia makes next step towards blocking websites of overseas FX brokers

The regulator has filed its proposals for legal amendments with the Ministry of Сommunications and Mass Media.

As the amount of Russian investor complaints against overseas Forex companies remains high, the Bank of Russia is planning to halt access to the websites of these entities.

The “Megaregulator” has made the next steps in doing so and has filed its proposals for law amendments with the Ministry of Communications and Mass Media (Minkomsvyaz). The announcement was made by Artem Sychev, Deputy Head of the Central Directorate for Security and Information Protection at the Bank of Russia, in an interview with Russian information agency TASS.

Mr Sychev explained that for the time being the Russian authorities have the right to block websites with .ru, .su and .рф domain names. The procedure, which does not require a court approval, is stipulated in the law “On Information, Information Technologies and Information Protection”. If a company targets Russian clients without having the permission to do so, its website address is entered into a special register operated by the Federal Service for Supervision in the Sphere of Telecom, Information Technologies and Mass Communications (Roskomnadzor) and is then blocked for containing information prohibited under Russian laws.

Mr Sychev notes that this procedure should be amended to cover websites with other domain names, apart from the above mentioned ones. This will enable to protect the rights of Forex broker clients, according to him.

Earlier this year, FinanceFeeds reported about plans by the Central Bank of Russia to impose certain rules (restrictions) on the websites of overseas FX companies that target Russian residents. Vladimir Chistyukhin, Deputy Governor of the Bank of Russia, said back then that these rules should concern information disclosure and protection of consumer rights.

Only companies with a Forex dealer licenses issued by the Central Bank of Russia are allowed to offer OTC Forex services to Russian clients. The law, however, includes requirements that have dissuaded many companies from trying to obtain a license – for instance, a minimum capital requirement of RUB 100 million (USD 1.73 million).

Thus far, eight companies have secured Forex dealer licenses in Russia.

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