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FXPA Releases Industry Guidance on FX Internalisation in Algo Execution

WASHINGTON, DC, July 17, 2025 – The Foreign Exchange Professionals Association (FXPA) published new industry guidance designed to standardize the definitions and use of internalisation in foreign exchange (FX) markets, with a specific focus on algorithmic execution. The paper, FXPA Guidance: Definitions and Best Practices for FX Internalisation in Algo Execution, represents a collaborative effort by members from across the buy side, sell side, trading platforms, and exchanges.

The guidance is the result of months of dialogue within FXPA’s Buy Side Working Group and is aimed at fostering greater transparency, clarity, and execution integrity in the global FX market. By establishing common definitions and best practices, the paper seeks to reduce confusion and potential information asymmetry stemming from inconsistent use of the term “internalisation”.

“Internalisation plays a critical role in today’s FX landscape, but without clear definitions and standards, its application can raise concerns around transparency and execution quality,” said Richard Turner, Senior Trader at Insight Investment and Chair of FXPA’s Buy Side Working Group, who led the development of the paper. “This guidance offers a practical framework that supports market integrity while enabling continued innovation and efficiency in FX trading.”

Key recommendations in the paper include:

  • Standardized definitions of two internalisation models (Client-to-Client Neutrality and LP Commercial Flow Offset)
  • Clear disclosure requirements around internalisation practices and trading venues
  • Best practices around execution and data quality
  • Emphasis on client confidentiality and prevention of information leakage

FXPA encourages all market participants to adopt the guidance as a benchmark for transparency and fairness in FX execution. To read the full guidance paper, visit https://fxpa.org/wp-content/uploads/2025/07/FXPA-Guidance-on-FX-Internalisation-July-2025.pdf

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About FXPA
The Foreign Exchange Professionals Association (FXPA) is a Washington-based organization that represents the collective interests of institutional FX market participants. Through education, research, and advocacy, FXPA works to promote a sound, liquid, transparent, and competitive global currency market. Learn more at www.fxpa.org.

Media Contact:  Julie Ros | jros@fxpa.org