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China Bans Popular FX Broker Services

Jan 01, 2018

We have already informed our audience regarding the newest Chinese tax regulations, legal limitations and other business rules. It is notably complicated to take into account every small detail while establishing company in China, therefore, we have prepared the latest news about broker activities in China.

Chinese legal entities have rights to perform their activities on the web within mainland, only if they are licensed by the government. All website traffic is thoroughly monitored and the commercial activities are controlled by the governmental authorities.

In November, the information was leaked regarding the new website bans. Popular FX brokerage websites were blocked whilst they were not Chinese. For example, such services as FXCM, FxPro, Aetos, XM and other. The main aim of the government authorities is to keep the “Great Firewall” safe and minimize foreign influence on the country. “Internet service exchange finance” platforms are considered as risky for the stable system of Chinese financial services.

What does this ban bring to the professional brokerage services? In China, there is a special profession as introducing brokers. They are a formal bridge between Chinese closed economy and international investors and entrepreneurs. This might become an only way to work with the Chinese financial market if the service bans will not stop.

Western brokerage services will be able to work further inside the Chinese borders but businessmen should take into consideration possible rules for operating such services in the future. This spring, the government indicated that in order to operate, the financial services firm owners will have to be connected to Chinese market directly. For example, you will need a connection to the Chinese payment facilities, a physical office and a website hosted on Chinese servers and to follow other requirements, which are not yet officially indicated.

An important part of doing business in China, is to always remember specific rules of this market. It is possible that your service would be blocked if the authorities cannot reach all information about the company or its transactions. In many ways, China is a country where opportunities can be found everywhere. Offshorelicense Ltd specialists are aware how to work with the financial and legal regulators in China. We can help your company stay inside the Great Firewall and do your business safely and effectively.

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