Margin trading in foreign exchange dealing contracts: a public-law model of risk management

Можаровська, Наталія Олегівна (2025) Margin trading in foreign exchange dealing contracts: a public-law model of risk management Міжнародний науковий журнал "Інтернаука". Серія: "Юридичні науки", 92 (10). pp. 32-41. ISSN 2520-2308, 2709-5452

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Abstract

Introduction. The modern foreign exchange market is one of the most dynamic sectors of the financial system, combining the private initiative of participants with the public interest of the state in ensuring currency stability. The development of foreign exchange dealing, especially under conditions of globalization and digitalization of financial operations, highlights the need to reconsider its legal nature as an instrument of state monetary policy. The international system of currency regulation, based on the standards of the IMF, FATF, the Basel Committee on Banking Supervision, and the law of the European Union, sets the guidelines for building national mechanisms of financial stability, risk management, and control over currency operations. Ukraine’s participation in these international processes determines the transformation of its currency legislation and the introduction of modern principles of margin trading into the legal framework as an instrument of public-law management of currency risk. Purpose. The purpose of the study is to reveal the legal nature of margin trading within the system of foreign exchange dealing contracts, to clarify its role as a public-law mechanism of currency risk management, and to determine the legal foundations for balancing the autonomy of the parties’ will with the imperatives of the state’s financial security. Materials and methods. The materials of the study include: – normative and legal acts regulating activities in the foreign exchange market, currency risk management, and margin trading, in particular: the Law of Ukraine «On Currency and Currency Operations», regulations of the National Bank of Ukraine, the Law of Ukraine «On Prevention and Counteraction to Legalization (Laundering) of the Proceeds of Crime», as well as international instruments – the Statute of the International Monetary Fund, FATF Recommendations, Basel Core Principles for Effective Banking Supervision, and acts of the European Union; – scientific works of Ukrainian and foreign scholars devoted to the legal nature of currency regulation, risk management, and financial security, including studies by N. I. Maidanyk, O. Melnyk, G. Wang, S. Kaup, S. Ramesh, V. K. Shrivastava, H. Hartono, and others; – empirical materials, such as official statistical data of the National Bank of Ukraine, analytical reports of the IMF and international financial institutions, which characterize the dynamics of the foreign exchange market, the risk profile of operations, and the practice of margin trading in the FOREX market. The methodological framework of the research is based on the principle of methodological pluralism, which involves the combination of philosophical, economic-legal, and special-legal approaches to the analysis of foreign exchange dealing as an institute of financial law. The dialectical method was applied to identify the regularities in the development of legal regulation of the foreign exchange market and the contradictions between the private-law autonomy of the parties and the public-law imperatives of financial security. The system-structural method was used to determine the place of foreign exchange dealing within the structure of financial law and to analyze the interrelation between its key elements – risk, margin, collateral deposit, and exchange rate. The comparative-legal method enabled the comparison of national and foreign practices in regulating margin trading and currency risk management (based on the standards of the IMF, FATF, the Basel Committee, and EU law). The formal-legal method was applied to interpret the provisions of Ukrainian legislation in the fields of currency regulation, banking activity, and financial control. The methods of analysis and synthesis were used to generalize doctrinal approaches to risk management in financial-law relations, while the economic-legal method served to explore the interrelation between legal and financial parameters of margin trading. Results. The article provides a systemic legal analysis of margin trading as a key contractual condition within foreign exchange dealing on the FOREX market, emphasizing its public-law content. It is substantiated that margin trading constitutes a special legal mechanism of regulatory assurance for the fulfillment of obligations, combining the private-law autonomy of the parties with the imperatives of financial security. It is determined that the margin account and margin deposit perform not only a collateral but also a stabilizing function within the system of currency regulation. It has been proven that risk management in foreign exchange dealing contracts has a dual nature: it simultaneously represents a legal duty of the professional market participant and an element of state control over the stability of the foreign exchange market. Conceptual approaches are formulated for classifying margin trading as a public-law model of risk management aimed at ensuring transparency, integrity, and financial stability. Discussion. Further research should focus on developing a normatively grounded model of legal regulation of margin trading as an integral component of the system of public-law management of currency risks. It is also promising to clarify the legal status of the margin deposit and the mechanisms of its use as a collateral instrument in financial-law relations. Particular attention should be given to the creation of unified standards for information disclosure and contractual transparency in the FOREX market, which will strengthen financial stability, reduce risks of abuse, and enhance confidence in Ukraine’s currency regulation system.

Item Type:	Article
Uncontrolled Keywords:	foreign exchange dealing; margin trading; financial law; risk management; foreign exchange market; public-law regulation; margin deposit; financial security
Subjects:	Статті у періодичних виданнях > Фахові (входять до переліку фахових, затверджений МОН)
Divisions:	Факультет права та міжнародних відносин > Кафедра публічного права
Depositing User:	Доцент Наталія Олегівна Можаровська
Date Deposited:	05 Feb 2026 14:11
Last Modified:	05 Feb 2026 14:11
URI:	https://elibrary.kubg.edu.ua/id/eprint/56293

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