Russian regulators to target Seychelles-based binary options firm in illegal advertising case
The Moscow office of FAS will add Seychelles-based Smartex International Ltd, owner of Olymp Trade, to the list of defendants in an illegal advertising case.
The Moscow office of the Federal antimonopoly service (FAS) has started its review of a case brought against Yandex and Process-A over alleged violations of Russia’s advertising law. On Thursday, September 14, 2017, the proceedings commenced.
Yandex and Process-A sought to defend themselves by arguing that the services they advertised were not financial and, therefore, do not require a license by the Bank of Russia. Moreover, they said, the company whose services they were advertising is targeting residents of the Seychelles and not of the Russian Federation.
The adverts in question were about online trading services provided by Olymp Trade, a brand of Smartex International Ltd. The website of the company offers a variety of trading services, with an apparent focus on binary options.
According to the Russian Association of Forex-dealers, which filed the complaint over the illegal advertising, there is a violation of the law, as the website of the entity in question has a Russian version and obviously targets Russian clientele. Moreover, the adverts were distributed in Russia, and clients are allowed to start trading using Rubles.
The case is postponed and the FAS intends to add Smartex International Ltd to the list of defendants.
Forex advertising in Russia is allowed only to companies that have Forex dealer licenses issued by the Bank of Russia. Binary options trading, however, remains a grey area and the regulators have not made any particular statements as to how this segment may be treated.
According to research by the Russian edition of Forbes, Russia accounted for 29% of the visits of four of the biggest binary options websites in April 2017. Forbes based its estimates on data derived from SimilarWeb.com. The data show that in April this year, the four platforms in question had more than 50 million visits. This means that Russia accounted for 14.5 million of them. Very far behind it in the ranking are Thailand, Brazil, Turkey and Vietnam – countries with apparently lax regulation.