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FinTechs belonging to this category operate trading platforms or online marketplaces for investment opportunities or certain financial contracts – e.g. securities, factoring etc. and sometimes furthermore provide contact to financial experts and tools for the decision-making.
FinTech-signalling and social trading platforms provide users with the opportunity to exchange opinions on financial investments and offer signal providers and traders the possibility to make their securities portfolio publicly visible. This way the portfolios can be linked to and followed by other traders via the platform automatically, so that the trading and investment strategy of the followed traders can be copied.
The platform often cooperates with a financial services provider or a credit institution where both the trader and the follower hold their securities accounts, and which execute the orders both of the trader and the follower and to which the platform passes on the trading decisions.
Introduction
Attitude of the country towards trading, social trading or signalling platforms
With regard to the social and political climate, we are not aware of any noteworthy discussions on the subject.
Legal affairs
Obligations and requirements to provide trading, social trading or signalling platforms described above
Please refer to Section b and c. above. However, FinTech Law has regulated alternative transaction systems, defined as “a physical or virtual place that allows its participants to quote, offer or trade financial instruments or publicly offered securities, and which is not authorised to act as a stock exchange under Law No. 18.045 or as a commodities exchange under Law No. 19.220."
According to Fintech Law, alternative transaction systems have to comply with certain requirements prior to provide their services. In this way, these services must be previously authorized to operate by the CMF. To be authorized, the applicant shall: a) Have the necessary systems and procedures in place to comply with the reporting and dissemination obligations set out in Article 8; b) Have the operational capacity to support the processing of transactions through its systems or infrastructure; c) Comply with the corporate governance and risk management requirements set out in Article 12; and d) Have internal regulations aimed at ensuring the existence of a fair, competitive, orderly and transparent secondary market for financial instruments, in order to promote adequate price formation and allow for the best execution of its users' orders.
Additional comments regarding the legal situation for trading, social trading or signalling platforms or what FinTech’s must be aware of in this business area
(*) International companies providing the services defined in the FinTech Law must be domiciled in Chile for these purposes, subject to express exceptions established by the CMF.
Economic conditions
Market size for trading, social trading or signalling platforms and biggest companies in this business area