Breaking: BaFin CFD Restrictions to Become Permanent in 2019

Following in , Germany’s (BaFin) announced on Thursday that it plans to make permanent the .
“In [making the rules permanent],” BaFin said in a statement, “the Federal Agency is permanently aligning the level of protection in Germany with the temporary product intervention [measures] of ESMA. This is intended to prevent attempts to evade these measures by providers from other EU countries.”
The German regulator published a ‘draft general administrative act’ on its website on Thursday morning. The act, which proposes a series of rules governing the sale of contracts for difference (CFDs), is almost identical to. Firms have until January 10th to respond to the rules. Of course, most people, from now until the beginning of January, will be celebrating the Christmas holidays, which may make formulating a response difficult.
BaFin – no lover of the retail industry
Like in France, BaFin has been much more outwardly opposed to the retail trading industry than some other regulators. In the past two weeks, for example, it two advising retail customers on how to avoid being scammed by contracts for difference and foreign exchange brokers.
Thus, the German regulator’s decision to make ESMA’s product intervention measures permanent is hardly surprising. The rules, which put caps on leverage and restrict brokers’ marketing abilities, were ostensibly temporary and still have to be renewed by ESMA every three months.
But no one in the industry seriously believed that either ESMA or national regulators would simply let the measures peter out and not renew them. Instead, they seem to have been a bureaucratic means by which to give national regulators time to adopt the rules themselves and, of course, make them permanent.