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The Financial Supervisory Authority‘s interpretation on the marketing, distribution or sale of CFDs or binary options

5.7.2018

The Financial Supervisory Authority considers the marketing, distribution or sale of CFDs and binary options covered by ESMA‘s measures dated 27 March 2018 to be contrary to proper and sound business procedures and practices in securities trading according to Article 5 of Act No. 108/2007 on Securities Transactions. The measures are based on Article 40 of Regulation (EU) No 600/2014 (MiFIR) in light of the inherent risk and complexity of CFDs and binary options causing significant financial losses for retail investors.

ESMA‘s measures prohibit the marketing, distribution or sale of binary options to retail investors and restrict the marketing, distribution or sale of CFDs to retail investors. Restrictions for CFDs provide for leverage limits of positions, a margin close-out rule on a per account basis, a negative balance protection on a per account basis, a prohibition on benefits incentivising trading and a standardised risk warning.

Further information on ESMA´s measures are accessible on its website: https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors.

Frequently asked questions on ESMA´s measures are accessible on its website: https://www.esma.europa.eu/sites/default/files/library/esma71-98-125_faq_esmas_product_intervention_measures.pdf

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