The IFX Expo 2017 had as its key discussion focus, the issue of regulation of binary options. This seems to have triggered a rash of activities by regulators in many countries, including Spain. So what is the current state of binary trading in Spain?
Spain is not one of the very prominent financial trading hubs as far as Europe is concerned. However, Spain was in the news three years ago when it was hit with a banking crisis that almost crashed the economy. A series of bailouts had to be organized to save the country’s banking sector. Spain was able to handle the crisis well and is coming out of the doldrums.
However, the rate of unemployment in Spain remains one of the highest in Europe. With a population seeking for alternative means of income, Spain has witnessed an increase in the number of people taking to financial trading, especially forex and binary options. So what do the Spanish regulators think about the whole thing?
Best Brokers in Spain
The CNMV has decided not to outlaw binary options trading in Spain, which is a departure from the practice in some Central European countries. However, brokers who want to attract Spanish clients to their platforms must adhere to the rules that have been set out by the CNMV.
It can therefore be said that binary trading is allowed in Spain, albeit with certain restrictions. In selecting the best brokers in Spain, the trader should visit the search engine on the CNMV Public Warnings page, and run a search on their preferred broker to see if the company has been given the all-clear by the CNMV. When this search turns up a favourable report, the trader can register a trading account with this brokerage, and go on to fulfill the verification processes. Here is out list of best binary options brokers in Spain.
The MiFID (Markets in Financial Instruments Directive) protocol, which sought to establish a centralized regulatory protocol for the European Union, presently allows for a binary firm in a MiFID-compliant European country to export its business to another MiFID-compliant European country. It is under this arrangement that many brokers offer their product to residents of Spain.
The securities markets in Spain are presently regulated by the Comison National del Mercado de Valores, or the CNMV (English name: National Securities Market Commission). The CNMV has in the last one year, been dishing out lots of information to those trading binary options in Spain about many operators and products in the binary options market. Most of these have been in the form of warnings against brokers and products that the CNMV considers illegal. In March 2017, the CNMV drew up new rules for all brokers, local and offshore, wishing to offer the trading of binary options in Spain.
According to the new rules, the following now apply:
- The CNMV now requires all firms and brokerages operating in the binary market, and who offer the trading of binaries to Spanish citizens, to expressly warn all retail investors resident in Spain about the complexity and risk of binary options products.
- These warnings, which must include a handwritten statement made by the client (or alternatively a recorded oral or typewritten statement), must be provided to ensure that all traders and investors in Spain have the same level of protection, and that all participants in the market in Spain have a level playing field.
The CNMV maintains two registers: one for authorized brokers and another for unauthorized brokers. The CNMV is a member of the European Securities and Markets Authority (ESMA) and the International Organization of Securities Commissions (IOSCO). The CNMV therefore recognizes the regulatory powers of the other country regulators who are members of these two organizations. As part of information sharing agreements, the CNMV receives alerts that have been issued by foreign securities regulators on unauthorized companies on a regular basis. This is how the CNMV populates its unauthorized brokers register. The CNMV maintains this database, which can be accessed by the public on the “Public Warnings” page, as well as the search engines on that page.
Deposit Methods Available In Spain
How do those who perform binary options trading in Spain deposit funds into their accounts, or withdraw funds from their trading accounts? The following methods are commonly used.
- Bank wires: Trading in Spain can be kickstarted by a simple account deposit using a bank wire. Spanish traders usually do this in Euros.
- Credit/debit cards: MasterCard, VISA and other major card service providers have made it possible for traders in Spain to deposit and withdraw from their trading accounts using the various cards.
- Digital wallets: There are many digital options wallets that Spanish traders can use. Apart from Skrill, OKPay and Neteller, there are others such as VISA’s V.me digital wallet, Sofort, QuickPay, etc. Some of these wallets integrate easily with Skrill for advanced usage options.
- Is it legal to trade binaries in Spain?
Binary option trading is legal in Spain, but brokers are required to operate under certain rules and regulations as spelt out by the CNMV.
- Are binaries regulated in Spain?
Yes, Binaries and other financial markets in Spain are regulated. The agency responsible for this regulation is Comison National del Mercado de Valores, or the CNMV (English name: National Securities Market Commission).
- How to trade binaries in Spain?
In order to perform binary options trading in Spain, you have to create a trading account with a local broker or an offshore broker. You must also conform to foreign exchange control regulations to be able to transact freely with your brokers.