After months of speculations and guessing, France has finally made the final step – the AMF decided to ban all advertising regarding binary options and forex trading. This is no surprise as French regulatory body was always frowning upon this type of financial trading, however, no one expected the decision to come so soon. This matter was taken into consideration by government bodies only this spring and it is almost unbelievable that French regulatory framework reacted so quickly.
According to the AMF, the first step is creating a bill that will limit the advertising of all financial products that offer leverage over 1:20. The transition period will last very shortly, only until September 30th. Then, as next step in the implementation of the ban, the list of all products they consider speculative will be published.
It is presumed that the ban will include:
- Binary options trading
- Forex trading
The ban will include all media available in France: the internet, radio, television and print, but it remains unknown what will happen with sports sponsorships among French clubs and binary brokers. Read full AMF release.
What Will Brokers Do?
The first victim of the new regime is 24option, good and CySEC regulated broker that offers great binary trading service to traders all over the European Union. 24option was banned from operating in France due to the content of their advertisement. According to the statement by Demetra Kalogerou, chairwoman of CySEC, published by Cyprus mail, she was also surprised that this happened:
“This decision was made over two sentences of promotional text on the company’s French website, which were deemed misleading, plus a single complaint out of some 10,000 clients.”
This is just another stumbling stone in the relationship between CySEC and the AMF. AMF is constantly expressing their dissatisfaction with the way CySEC regulated the binary market in the European Union and is trying to keep total authority over the binary market in France, which is impossible as CySEC is the overall European regulator.
On the other hand, CySEC is more serious than ever and is working hard on assuring customer protection that will be on the satisfying level. Find out more about CysEC new rules.
Who failed: CySEC or the AMF?
Even though it may seem that the AMF is doing the right thing, it seems that this action could be another step to prevent their further failures. The AMF was always known as a pretty harsh regulatory body but it seems that they failed to ensure safe trading environment despite their approach. The number of people who claim to be scammed is increasing, not only because of the ever growing number of scam brokers, but also because the AMF is causing unfriendly atmosphere that is supported by lack of proper information.
Is France the New Israel?
With such unfriendly attitude towards binary options, it can be expected that France will completely ban binary options trading and make all licenses invalid. However, as we learned from Israel’s example, this won’t do much for customer protection. Bans create the perfect environment for scam brokers operated by scam companies and leave customers helpless and without the support they need.
Scam companies will still provide their services, and will probably continue to advertise as they like, as their offshore accounts are almost untraceable. Yet, this ban will harm many regulated and respected brokers who are offering good trading services. It will also limit the number of good brokers willing to operate in France, which will expose French citizens to much higher risk, especially if the rules regarding advertising remain unclear.
It is always advised to trade with regulated brokers and research them as much as possible. Trade with Banc De Binary, an AMF regulated broker.