27 March, AtoZForex.com, Lagos —The credibility of financial watchdogs in Europe has been questioned due to the legal fight between the Dutch regulator AFM and Optieclub, a Dutch binary options broker. Reportedly, Optieclub applied to the AFM for regulation, while the AFM had rejected its application. Based on recent development, the binary options firm Optieclub is expected to receive authorisation, so as to be able to offer financial trading products after Holland`s courts rejected their decision not to regulate the binary options broker. The new verdict may see the Netherlands become a new hub for binary options brokers.
AFM refused to authorise Optieclub
Initially, the AFM refused to authorise Optieclub, due to the fact that it felt uncomfortable with products that offer short-term maturities. The Dutch financial regulator then stated that the broker will have to hold a gambling license, in other to promote its investment products. This particular statement of the AFM denotes that the binary options products offered are considered to be a game of chance, which is not acceptable by the defending party.
Ever since may 2014, when the AFM bluntly refused to issue out a license for the Dutch binary options broker, Optieclub has appealed the case with success. Considering that the matter has being settled in the courts. On top of taking the matter to court, the Dutch financial regulator has also experience additional pressure from the court itself. As, the AFM is expected to pay some legal fees to Optieclub, while the regulator has been given two weeks to make a decision. Hence, the AFM and Optieclub battle over license is a quite remarkable case.
Gambling or a financial trading product?
Evidently, binary options are one of the fastest growing investment products in the world. Despite, the rapid growth of the investment products, professionals in the industry are at the moment debating whether the product should be classified as gambling product or financial trading.
Since a lot of companies in the financial markets are enhancing their contracts offerings to include binary options in shows how lucrative it is.
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