France’s AMF opens consultation on restrictions for offering CFDs and binaries

Maria Nikolova

The French financial markets regulator is seeking public comments on how to implement measures analogical to those introduced by ESMA at a national level.

France’s financial markets authority AMF has earlier today announced the opening of Consultation regarding measures restricting the offering of CFDs and banning the offer of binary options to non-professional investors at a national level.

The idea behind the proposals is to have rules for investor protection, analogical to those introduced by ESMA. These rules are set to work at a national level. Broadly speaking, the restrictions proposed by the French regulator are identical to those outlined by ESMA. The list includes negative balance protection and leverage restrictions for CFDs, for instance.

The public consultation is open until April 15, 2019. Feedback has to be sent to [email protected]

This regulatory move by France has been largely expected given the recent comments by AMF’s chairman Robert Ophèle. Back in October 2018, he warned that serious problems had become apparent since the introduction of the new ESMA rules. He explained that these problems are due to the temporary nature of the product intervention measures, that is, that these measures last three months and then have to be renewed. This duration, according to Mr Ophèle, is too short and may increase certain risks. 

According to Mr Ophele, it is particularly worrying that, once ESMA does not renew the rules for CFDs and binary options, there will be a multitude of national regimes regarding the offering of these products. This will result in chaotic surveillance of products that are marketed online.

Let’s note that a number of European countries, including Germany and the Netherlands have also sought to introduce measures analogical to ESMA’s restrictions for the offering of CFDs and binary options to retail clients.

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