Forex Trading in the Philippines and BSP Forex Brokers
The current situation, for those of you looking for Forex brokers in the Philippines, is a little confusing. This is because the country’s financial system is still in the early stages of its development, and is currently facing stiff competition from the likes of Japan, Singapore, Malaysia, and Hong Kong. The Banko Sentral ng Pilipinas (BSP), is the official authority responsible for monitoring the country’s economy and providing a safe and stable environment. The regulation of a number of different financial institutions is the responsibility of the BSP, but Forex broker regulation is provided by the SEC.
Forex broker regulation is provided by the SEC
Forex brokers in the Philippines are regulated by the Securities and Exchange Commission. It is an agency of the government responsible for monitoring the securities industry. As well as having regulatory functions it is also the holder of the country’s register of companies. And a number of other functions including:
|Forex Review & Rating||Highlights||Regulation||Min. Deposit||Bonus||Visit Broker|
|*||Next-generation online CFD trading platform||CYSEC||$100||60%*||Trade!|
|*||$1,000,000 Forex Championship at XM||CYSEC||$5||100%*||Trade!|
|*||Trade 100’s of CFD and Forex products online||FSA||$50||$5,000*||Trade!|
- The supervision of all SEC registered business entities, along with the power to suspend or revoke registrations
- Writing market securities policies
- Managing and approving security registration statements
- Looking into securities law violations, instigating investigations and imposing any required sanctions
- The issuance of subpoenas, punishments, and cease and desist orders
What the SEC is allowed to do
Aside from the regulation of Philippine Forex brokers, the SEC has a number of other responsibilities. Its main concern is to safeguard the stability and integrity of the country’s financial markets, and it does this via the ultimate control it has over all kinds of financial services providers, including brokers regulated by the BSP. There are certain rules and requirements a regulated entity has to comply with and breaking of those rules is not tolerated. As well as the issuance of licenses, the SEC also has the power to revoke them, cancel , terminate or suspend them, and renew them. The SEC makes the final decision as to whether a financial services provider is able to operate.
The Commission’s aim is to increase transparency and confidence in the financial markets in the Philippines and to meet this aim it develops regulatory guidelines and recommendations. But it also advises the government, Congress, and other federal agencies. There is, however, a slight difference from the normal work of a regulatory agency. It has absolute power over individuals and companies and is even able to ask for help from ministry, civil, or independent enforcement bodies to help it carry out its regulatory responsibilities. It has the power to issue ‘cease and desist’ notices if it is considered the wrong-doing is putting the public at risk. It has the power to take the matter to the courts in order to reach a resolution, and issue search and seizure notices in order to obtain the necessary evidence.
However, things are not as rosy as they seem for Forex brokers in the Philippines and the SEC. There are a number of leading experts who consider the Commission to have too much power and it has had a dramatic effect on the regulation of national financial companies. And we should say the effect is not considered a positive one. Nevertheless, there is no denying the SEC is a very influential agency in the country’s financial world and has the benefit of powers usually reserved for much higher authorities.
What role does the BSP play for Forex traders in the Philippines?
The BSP is really more concerned with the financial stability of the country. However, it does play an important role in the Forex trading world. Some of its responsibilities involve the streamlining of the money exchange process and other financial dealings that form an important part of the retail trading industry. It also has responsibility for determining the exchange rate policy for the Philippine peso (PHP) against other currencies. The country’s currency reserves are also managed by the BSP. and both the exchange rate policy and the currency reserves are vital for the value of the peso, as well as enabling the country to achieve international financial visibility.
The stabilizing of a country’s economy is pretty complex, and plenty more of the BSP’s roles play an important part. For example, it is a lender, financial advisor and a body which can help to maintain market liquidity. How is it able to do this? By helping other banks and government agencies. The BSP is able to extend loans, raise capital, issue advances, act as a depository and offer discounts for other financial entities.
So while the BSP isn’t responsible for regulating Forex brokers it does have an important role to play in stabilizing the economy. Issuing currency, keeping the money supply, maintaining liquidity and developing monetary policies means its regulatory plate is pretty much full. Therefore, it should come as no surprise to discover that Forex brokers in the Philippines are regulated by the SEC.
Is it possible to choose a broker regulated by the BSP?
In the strict sense of the word, no it isn’t. Because Forex brokers are actually regulated by the SEC. And there are also no actual restrictions to prevent traders in the Philippines from choosing any broker they want. The regulatory framework for financial services may still be developing, but a BSP Forex broker is still considered a better option than an unregulated broker.
Regulated Forex brokers in the Philippines do offer a reasonable amount of protection for your investment, and if you are still unsure which one to choose it is possible to get expert financial advice. And if you spend some time exploring your options it will be time well spent. Serving you well in the future and providing you with more peace of mind than choosing an unregulated broker. Forex trading is a risky form of investment, so you should try and minimize the risk as much as possible. Choosing a Philippine SEC regulated broker is definitely a step in the right direction, leaving you to concentrate on your trades and hopefully make some money.