IG Group officially responds to French FX and CFD advertising ban

“Overall, the company does not believe these restrictions will have a material negative impact on its business in France in the short term and could ultimately enhance the Company’s future competitive position in the country.” – IG Group

In August last year, the Autorité des marchés financiers (AMF) in France, took the approach of seeking to outlaw all derivatives advertising altogether.

This means a blanket national ban on all OTC asset classes being advertised across any media by any company from any nation.

The “Sapin II” bill on transparency, as it is termed by the regulator, was instigated in order to, according to the French authoriites, assist in the fight against corruption and the modernisation of the economy.

As a result of this, AMF stated at the time that it will impose a ban on the advertising of certain highly speculative and risky financial contracts to private individuals by electronic means.

In order to finalise the regulatory framework, the Autorité des Marchés Financiers (AMF) launched a consultation which ran until 30 September 2016, on the introduction into its General Regulation of the categories of contracts targeted by the ban, which has been set in force today.

Article 28 of the “Sapin II” bill will introduce a mechanism to prohibit all forms of marketing communications addressed directly or indirectly by investment service providers, via electronic means (e-mail, online advertising banners, radio, TV, etc.), to individuals, regarding financial instruments that are particularly difficult to understand and potentially very risky. The text will enter into force after it is voted on by Parliament and enacted into law.

The law stipulates that the categories of contracts targeted by the ban are to be defined in the AMF’s General Regulation.

The AMF proposes adding a heading to Book I of its General Regulation entitled “Supervisory measure on marketing communications concerning financial contracts”. It shall be worded as follows:

Under Article L. 533-12-8 of the French Monetary and Financial Code, marketing communications regarding binary option contracts or contracts that promote a direct or indirect investment in the FX market, or CFDs which have a leverage greater than 5:1.

Today, IG Group, one of the most prominent and longest established electronic trading companies in the world, released its official position with regard to this ruling.

IG Group’s official position on this matter states that “Following the passing of the Sapin 2 law at the end of 2016, the general rulebook of the AMF has now been adopted.”

“The AMF has confirmed certain restrictions on electronic marketing of CFDs to retail clients in France. The key marketing restrictions do not impact the accounts that IG now offers to new clients in France, because IG’s accounts provide a limited loss-by-position guarantee as required, and therefore also a guarantee of no negative balance. The AMF will also ban all electronic marketing involving FX and Binaries.”

“As anticipated, the restrictions have no impact on the current client base. Overall, the company does not believe these restrictions will have a material negative impact on its business in France in the short term and could ultimately enhance the Company’s future competitive position in the country.”

“IG believes the AMF’s approach will provide substantial protection for consumers and greatly improve standards in the sector. IG supports robust and proportionate regulatory oversight of the CFD sector in all the markets in which it operates. The Company has operated and will continue to operate to the highest standards in the industry” concluded the company.

Read this next

Digital Assets

Cathie Wood’s sponsored Bitcoin ETF sees historic $200 million inflows

The ARK 21Shares Bitcoin ETF (ARKB), co-sponsored by Cathie Wood’s ARK Invest, registered historic inflows exceeding $200 million on Wednesday, signaling a robust appetite among investors for Bitcoin-centric investments.

Digital Assets

Sam Bankman-Fried might see his 25-year sentence halved

Sam Bankman-Fried, the founder of the failed cryptocurrency exchange FTX, was sentenced to 25 years in federal prison by a Manhattan court on Thursday. This comes after he was convicted of defrauding customers and investors, with Judge Lewis Kaplan highlighting the potential future risks posed by Bankman-Fried.

Technical Analysis

EURJPY Technical Analysis Report 28 March, 2024

EURJPY currency pair under the bearish pressure after the pair reversed down from the major resistance level 164.25, which also stopped the sharp weekly uptrend at the end of last year,

Digital Assets

BlockDAG’s Presale Hits $9.9M, MultiversX & MINA Price Predictions Show Green

Read about BlockDAG’s promising $10 prediction and insights on MultiversX Price Prediction as MINA’s potential unfolds.

Digital Assets

Rockstar Co-Founder and All-star Line Up Join Advisory Board to Take Metacade into Post Beta Orbit

Metacade, the revolutionary Web3 gaming platform, prepares to streak out of beta with a slew of ground-breaking initiatives that will redefine the way blockchain games are developed.

Retail FX

Prop firm The Funded Trader shuts down, claims relaunch in April

Prop trading firm The Funded Trader has ceased all operations, with claims for a relaunch in the near future.

Digital Assets

Ethereum-Based Tokenized Real Estate Platform USP Launches On Republic

How This Californian Startup Is Revolutionizing Real Estate Investment through Ethereum-Based Tokenization.

Digital Assets

Sui Spikes in Weekly DEX Volume, Joins Top 10 of All Blockchains

March DEX volume on Sui stands at over $2.88B – up more than 49% from February – with decentralized exchange Cetus and wholesale liquidity layer DeepBook leading.

Digital Assets

Prisma Finance suffers $10 million crypto exploit, attack ongoing

Liquid staking protocol Prisma Finance fell victim to a security exploit on March 28, resulting in nearly $10 million in Prisma mkUSD and wrapped stETH being stolen by hackers.

<