Baidu reverses ban on Forex advertising in China for selected brokers only – LeapRate Exclusive


LeapRate Exclusive… LeapRate has learned from various FX industry insiders that Chinese online search giant Baidu Inc (ADR) (NASDAQ:BIDU) is reversing its ban on ads for online Retail Forex brokers which was instituted earlier this year.

However, Baidu will allow ads only by specific brokers which it approves on a one-by-one basis.

LeapRate reported exclusively about six months ago that Baidu had initially banned ads for Binary Options brokers, which it later expanded to include Retail Forex brokers, following a general shakeup and crackdown in online advertising in China. (More on that story and what led to the ban can be seen in our original article here).

Baidu accounts for about 70% of search results in China, a figure fairly close to that of Google search outside of China. So for companies such as online brokers which rely mainly on online advertising for generating new client leads, the ban has created a major shakeup in the China retail forex sector.

However we have learned that Baidu has since softened its stance somewhat, and is involved in due diligence processes with a number of Retail Forex brokers wanting to do business with Chinese clients.

Baidu’s diligence process is apparently quite extensive, examining everything from ownership, to licensing, to general reputation of each broker being vetted. Most if not all of the brokers being considered to be green-lighted for advertising on Baidu are licensed in recognized jurisdictions, such as the EU (FCA, CySEC) and Australia (ASIC).

The permitted advertising itself will also remain under scrutiny. A broker found to be using misleading or unrealistic ads (e.g. guaranteed returns, no-risk trading, etc.) will lose their advertising rights.

While allowing banner ads for approved brokers, Baidu is still going to be very guarded about search results. Backlash following the death of an ill Chinese university student earlier this year – after he chose a cure for the rare form of synovial sarcoma afflicting him based on paid-for search results on Baidu – led Baidu to overhaul its search results process, focusing on better labeling (and a reduction) of paid-for results.

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  • Josh — Fxbon Consulting

    The reason Baidu don’t allow Cysec and Asic is not because Baidu team are real expertise on Forex regulation, The made the judgement base on their customers’ compliance, there are many local chinese platform owner use Asic Assets/ advisory license to misleading customers as they are Asic Brokerage license holder, also For Cysec, After IronFx and ACFX case. Cysec licensed platforms has a very bad reputation in china. That is why Baidu play the safecard. and not put Cysec and Asic license as green light group .
    Josh zhou

    • So can you state which Foreign brokers are currently “allowed”?

      • LeapRate Staff

        None so far, there are a few in the midst of the Baidu due diligence process whom we can’t name as we were told in confidence. But as per the article, all are licensed by either an EU regulator (CySEC, FCA) or ASIC. We’ll update once we learn that the process has been completed.

  • Richard Rayles

    Is it illegal for Mainland Chinese to trade with one of these regulated firms? Does the 50K USD annually apply?

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Baidu reverses ban on Forex advertising in China for selected brokers only - LeapRate Exclusive

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