New Israeli Binary Options Law is expected to ban the Israeli Binary Options trading platforms as a whole in the country. When will the law come into force?
23 June, AtoZForex – The new Binary Options Law in Israel is coming. Earlier last week, AtoZForex reported that the Israeli Securities Authority (ISA) got an approval from the Israeli government and ministerial committee for the New Israeli Binary Options Law.
The law seeks to ban the solicitation of Binary Options to the foreign clients. The officials intend to implement the new law aside from the existing rules, which prohibit the offering of Binary Options products to Israeli residents. The new press release by the ISA states that the New Israeli Binary Options Law will need to seek the approval by the Knesset, the Israeli Parliament.
New Israeli Binary Options Law
The first formal reading will take place this upcoming Monday. 26th of June. Israeli Parliament is requiring three official readings in order to pass the law. The three readings are usually followed by the Knesset vote. During the final vote, the authorities decide on whether to approve or decline the law.
As I mentioned above, the New Israeli Binary Options Law has already passed the Israeli Cabinet on the 18th of June. This implies that the new law is going to the Knesset as a Government Bill. That is why this new Binary Options law has a very high chance of being approved.
What if New Israeli Binary Options Law will pass Knesset vote?
In case the bill will go through all three readings and Knesset will vote in favor of approving it before the summer break (July 31), the new Binary Options legislation will come into force after three months. This implies that we can see the new Binary Options law in effect as soon as late September or early October.
The new legislation is considering the ban operations of a Binary Options brokerage in Israel as a whole. Moreover, it seeks to make the Binary Options activities a criminal offense. In case the law will be passed, soliciting Binary Options to Israeli residents or to foreign clients can get you in prison for two years.
In addition, the Binary Options activities will be considered as a violation of Israeli anti-money laundering (AML) laws. This could also mean prison and monetary penalties for criminals.
Why is New Israeli Binary Options Law necessary?
Initially, the Binary Options bill was proposed by the Chairman of ISA, Shmuel Hauser. In 2016, Prof. Shmuel Hauser has reported to Israeli local media that he has addressed the legal authority of the government. He was asking to enable him to cease the marketing of Binary Options abroad. Such initiative was taken, as according to Mr. Hauser it is “an ugly phenomenon that is tarnishing Israel’s image.”
Mr. Hauser has also commented:
“Beyond the grave economic harm caused to citizens all over the world, binary option marketers also cause grave, destructive damage to Israel’s image. It is quickly gaining momentum and fueling antisemitism against Jews in general and Israelis in particular.
This law will allow the ISA to take unprecedented action against those parties that currently operate in Israel and cater to clients outside Israel. It will also allow to impose civil and criminal penalties, up to the imposition of actual jail time.”
Almost one year ago, the ISA has banned the trading platforms to trade in Binary Options with Israeli residents. Essentially, the regulator believes that the Binary Options is not a financial instrument, but the gambling tool. Also, the regulatory authorities have been receiving a large number of complaints about financial losses from the foreign clients resulting from Binary Options trading.
For these and other reasons, Israeli watchdog decided to take initiative. The new Israeli Binary Options Law seeks to eliminate the illicit activities that are harming overseas investors.
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