Registration Guidelines In Foreign Exchange

There are some registration guidelines in foreign exchange which the traders have to follow in order to register themselves with the foreign exchange authority so that they are eligible for trading forex.

These registration guidelines in forex act as a general self-examination checklist for registration under various categories in foreign exchange trading. Listed below are some of the important and main guidelines for registration in foreign exchange. It is important that traders who want to trade in foreign exchange currency market be aware of these registration guidelines in foreign exchange. Knowing these registration guidelines in forex makes the registration process easy.

Let us take a look at the registration guidelines in foreign exchange below:

1. It is required that all the individuals be listed as principals on the member’s form meant for registration purpose.

2. Define clearly about who is holding the following mentioned positions with the Member:

a. Sole proprietor of a sole proprietorship;
b. General partner of a partnership;
c. Director, president, chief executive officer, chief operating officer, chief financial officer or a person in charge of a business unit, division or function subject to regulation by the Commission of a corporation, limited liability company or limited partnership;

Or Manager, managing member or a member vested with the management authority for a limited liability company or limited liability partnership.

3. Define who directly or indirectly, through agreement, holding companies, nominees, trusts or otherwise, have the following financial relationships to the Member:

a. Own 10 percent or more of the outstanding shares of any class of the Member’s stock;
b. Are entitled to vote 10 percent or more of any class of the Member‘s voting securities;
c. Have the power to sell or direct the sale of 10 percent or more of any class of the Member’s voting securities;
d. Have contributed 10 percent or more of a Member’s capital;
e. Are entitled to receive 10 percent or more of a Member’s net profits.

4. Define who have the power to exercise a controlling influence over an applicant’s or registrant’s activities that are subject to regulation by the Commission.

5. There should be a list which clearly defines all the entities as principals on the Member’s Form which are as following:

a. A general partner of a partnership;
b. The direct owner of 10 percent or more of any class of an entity’s securities; or
c. Entities that have directly contributed 10 percent or more of a Member’s capital unless such capital contribution consists of subordinated debt contributed by:
d. An unaffiliated bank insured by the Federal Deposit Insurance Corporation;
e. A United States branch or agency of an unaffiliated foreign bank that is licensed under the laws of the United States and regulated, supervised and examined by United States government authorities having regulatory responsibility for such financial institutions; or
f. An insurance company subject to regulation by any State

6. Traders must ensure that all individuals who are responsible for supervising APs are registered as APs.

7. All the guarantee agreements and terminations with NFA should be filed and a copy of the signed guarantee agreement should be maintained.

8. It is mandatory to file with NFA an Individual Withdrawal Notice within thirty days after principals, branch office managers or APs terminate their affiliation with the Member.Broker-dealers may no longer file a Form U5 in lieu of the Form 8-T; however, they may elect to complete and file the U5 disciplinary questions as part of the Form 8-T. The sponsor that files the Form 8-T must promptly provide a hard copy version to the person whose association has been terminated.

9. Registration guidelines in forex also state that traders must ensure that at least one principal is registered as an "associated person" otherwise NFAshall deem that Member's failure to be a request to withdraw from NFA membership and shall notify that Member accordingly.

10. Also stated in the registration guidelines in foreign exchange is that traders should immediately correct any deficiency or inaccuracy on the Member’s Form 7-R which no longer renders accurate and current information contained therein on NFA’s Online Registration System.

The above stated registration guidelines in foreign exchange are meant to help you know the registration process better.