Russian antimonopoly authorities find Yandex, Nefteprombank in breach of FX advertising regulations

Maria Nikolova

FAS says that the companies disseminating the ads are responsible for monitoring the information they provide.

A followup to FinanceFeeds’ earlier report the Moscow office of the Federal antimonopoly service (FAS) launching a case against Yandex and Nefteprombank over illegal Forex advertising…

FAS has published an update on the probe, saying that it found Yandex and Nefteprombank broke the Russian Law on Advertising. The investigation concerns ads of services offered by Nefteprombank that appeared on Yandex.Direct. The ad promoted the services of a Forex dealer (the official designation of Forex brokers in Russia) but the company lacked the necessary license.

The regulator notes that the companies disseminating ads, regardless of the volume of advertising published, are responsible for the control of the information they provide. Both the company whose services are advertised and the company providing the ads are responsible for the law violations, under the Russian laws, FAS notes.

The regulator also emphasizes that the ads in question did not feature any warnings concerning the risks associated with Forex trading.

According to the Russian Forex law, which was signed by Vladimir Putin at the end of 2014, only companies with Forex dealer licenses issued by the Central Bank of Russia are allowed to advertise Forex services to Russian clientele. In the face of the law, Russian media are full of ads of non-Russian FX brokers.

In August 2017, FAS launched a case against Yandex and Process-A over alleged violations of the advertising law. Yandex, which distributed the advertisement in question, and Process-A, which is an advertiser, are alleged to have allowed dissemination of advertising of services that require licenses issued by the Bank of Russia. In addition, the advertisements did not display the full name of the provider of the services. That action referred to ads displayed on Yandex.Direct in March 2017. These ads promoted the services of an entity that was not licensed by the Bank of Russia to offer derivatives and/or Forex services. The advertisements were featuring text like “Forex online” and “binary options”.

That case, however, has stalled, as FAS said it intended to add an offshore entity – Smartex International Ltd, to the list of defendants.

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