Country update on regulatory changes affecting the forex and CFD markets

While we await the feedback from the FCA following the issue of CP 16/40, we are committed to keeping you informed of the regulatory changes in the CFD and forex markets to equip you to make critical business strategy decisions over the coming year.

Please read further to find out about how the regulation of The CFD and Forex markets is shaping up across Europe.

Forex and CFD market update:

Ireland – the Central Bank of Ireland indicated two main avenues that it is considering:
1) total prohibition of the sale or distribution of CFDs to retail clients in and from Ireland altogether; or
2) the implementation of enhanced investor protection measures including a limitation on leverage.

Spain – the national regulator indirectly communicated in its activity plan outline for 2017 that they intend to undertake an analysis of initiatives with complex, high-risk products – i.e. leveraged products traded by retail clients.

United Kingdom – the FCA has issued proposals banning bonus payments to retail clients, and limiting Forex and CFD leverage to 50x. Feedback on the FCA’s proposals were due 7 March.

Cyprus – CySEC has banned bonus payments, and limited introductory leverage to 50x (with higher leverage allowed for experienced traders).

Germany – BaFin requires negative balance protection.

France and Holland – The national regulators have issued an advertising ban on leveraged products.

Belgium – total ban on leveraged trading products.

Moore Stephens are considered at the forefront of the CFD and forex industry and provide accounting, regulatory and advisory assistance to a number of firms in this space. Should you wish to discuss the above topics with a member of the team please click here.

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