While the British government on the mainland is reconsidering its stance towards the regulation of binary options, by examining the prospect of shifting the responsibility for regulating such activities from the Gambling Commission to the FCA, two other self governing dependencies of the Crown are offering another solution to prospective firms wishing to get regulated in order to offer trading in binary options and CFDs.
More specifically, the Alderney Gambling Control Commission (AGCC) announced today that it has reached a deal with the Guernsey Financial Services Commission to begin offering dual licensing to the spread betting industry, under the terms of which they will jointly regulate binary options and CFDs.
Robin Le Prevost, director for business development for Alderney, justified this decision by pointing out that: “We were aware that the spread betting, CFD and binary options sector were looking for a quality jurisdiction from which to base their operations. We have often been approached, but the AGCC has been unable to accommodate their requirements due to the investment nature of some of the products.”
He added that therefore: “The AGCC has been in discussions with the Guernsey Financial Services Commission over the demarcation of their respective remits and this collaboration is the result. The two organisations have combined their skill sets and will offer dual licensing covering the full range of products this sector specialises in. This means binary options, binary betting, contracts for differences and all types of spread betting can be covered by this dual licensing system.”
Mr Le Prevost went on to highlight that: “Alderney is world renowned for its beneficial commercial environment, stable government and technical prowess and these compelling elements will remain and are indeed enhanced by Guernsey’s involvement. The combined benefits of the two islands offer a highly attractive location from which to base companies from this sector.”
It remains to be seen whether this innovative approach of dual licensing will prove a successful move and it will be interesting to closely monitor how many brokers will opt for this type of licensing. The prospects seem good since the two involved Channel Islands are already recognised as one of the world’s leading offshore finance centres and have in recent years established themselves as e-commerce centres of excellence.
Moreover, and while both Alderney as well as Guernsey are neither part of the UK nor the EU, they do have modern banking, insurance and investment laws, while the Guernsey Financial Services Commission is the statutory body responsible for ensuring that the finance industry on Guernsey and Alderney is well regulated. Alderney is subject to the provisions of Guernsey taxation laws.
Alderney licensees are by law permitted to take advantage of the modern hosting facilities and reliable telecommunication networks on both Alderney and Guernsey. For international network links, Alderney and Guernsey’s telecommunication network offers reliable and high capacity links to the UK, Europe, the USA and Asia, making this newly established jurisdiction through the dual licensing scheme, a truly attractive alternative for interested service providers.