The Austrian Financial Market Authority (FMA) has issued a Regulation that prohibits the marketing, distribution and sale of binary options to retail clients, and which also massively restricts the marketing, distribution and sales of contracts for difference (CFDs) to retail clients. It thereby ensures that the product intervention measures that have been imposed by the European Securities and Markets Authority (ESMA) since 2 July 2017 (for binary options) and since 1 August 2018 (CFDs) throughout Europe, but which were temporary in their nature, remain seamlessly applicable in Austria. The restrictions on the distribution of contracts for difference (CFDs) relate to leverage limits, a suretyship to be set to one side in conjunction with protection against closing-out, protection against negative balances and the prohibition of incentive programmes. In addition publicity and sales materials for CFDs must contain clear and comprehensible risk warnings.
“These measures serve the purpose of protecting retail investors against the risks and losses that they are not able to foresee”, remarked the FMA’s Executive Board members, Helmut Ettl and Klaus Kumpfmüller: “The application of these new legal possibilities has already proven itself under the ESMA regime, and we are now taking the protection of retail investors a step further at national level.”
The FMA Regulation on Product Intervention Measures (FMA-PIV; FMA-Produktinterventionsverordnung), which defines these measures for protecting private investors, entered into force on 15 May 2019 and shall apply to binary options as well as contracts for difference that are marketed, distributed or sold in or from Austria from 30 May 2019.
The text of the Regulation as well as further information about binary options and contracts for difference (CFDs) may be found on the FMA website under the following link: https://www.fma.gv.at/en/fma-regulation-on-product-intervention-measures-fma-piv-published/
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