Forex trading is legal in Israel and falls under the jurisdiction of the Israel Securities Authority (ISA), which serves as the primary regulatory body overseeing all securities and trading activities (1). This framework ensures that forex brokers adhere to stringent operational and financial standards before offering services to Israeli residents.
To operate legally, forex brokers must obtain an ISA license, demonstrating sufficient capital reserves, compliance with anti-money-laundering regulations, and transparent reporting mechanisms (1). Retail traders are encouraged to engage only with ISA-licensed brokers to benefit from the protections and dispute-resolution processes mandated by Israeli law.
"In Israel, Forex trading is legal and regulated by the Israel Securities Authority (ISA). Brokers wishing to operate in the Israeli market must obtain a license from the ISA, demonstrating compliance with regulatory standards. The ISA enforces strict oversight to ensure fair trading practices and investor protection."
Moreover, under Amendment 42 to the Securities Law enacted in 2015, the ISA reinforced its regulatory scope to include margin trading and leverage limits for retail clients, effectively standardizing risk management protocols across the industry (2). These amendments also granted the ISA authority to supervise marketing activities aimed at Israeli investors, reducing exposure to fraudulent offshore entities.
Although forex trading is fully legal, Israeli traders should be aware of tax obligations, as profits from currency trading are classified as capital gains subject to standard income tax rates. Additionally, the ISA periodically publishes updates on permissible leverage ratios and capital requirements for brokers to maintain a balanced and transparent market environment.
Source:
https://tradersunion.com/best-forex-brokers/in-israel/forex-regulation/
https://www.israelnationalnews.com/news/285433
Last updated: 02-06-2025 Disclaimer: This article does not provide legal advice. If you need legal advice, please contact an attorney directly.
