The Central Bank of Russia (CBR) has granted forex broker license to TrustForex, while refusing license to Profit Broker, according to data published on the bank’s website. Meanwhile, TeleTrade Group announced it has also obtained a Russian forex broker license. The decisions were voted on 12 May, 2016. The CBR did not explain why it has decided to refuse license to Profit Broker.
As of 1 January, 2016, Russia started requiring locally-based forex brokers to be licensed by the CBR in order to operate in the country. However, foreign brokers are still allowed to target local citizens without any significant restrictions and most market participant continue to operate in the country through their foreign units.
Although many forex brokers have applied for Russian license in late 2015 and in the beginning of 2016, the CBR has been taking its time and delaying its response. By law, it has to come up with a decision within 60 business days of receiving an application. The reason for the delays is not clear.
As a prerequisite for obtaining a Russian license, forex brokers need to participate in a self-regulatory organization (SRO) with at least 10 members. In order to oversee such organizations, the CBR recently launched a register with SROs and has already included several organizations in it. Both TrustForex and TeleTrade are members of Russian SRO Centre for regulation in OTC Financial Instruments and Technologies (CRFIN), which, however, is still not a registered SRO.
TeleTrade offers trading in forex and contracts for difference (CFDs) on commodities, stocks, futures and currencies. TeleTrade group companies are also licensed in Cyprus and awaiting authorization in Belarus.
Profit Broker, which was set-up in 2015, applied for Russian license on 20 November last year. Although the CBR provides no reasoning as to why it did not grant licens to the broker, it seems it has good reasons. On its website, the broker provides no information regarding licensing or regulation. However, its website is almost identical to that of EU Broker Age, which is blacklisted by several Russian SROs, including CRFIN and KROUFR. Even there logos are the same, only in different colors.