Today the European Securities Markets Authority (ESMA) publicized yet another extension to its rules on marketing CFDs across the EU. The decision comes as no surprise and is the third such move since the new framework for regulating retail brokers came into force last August.
The latest enforcement action on part of the EU regulator is also urging national regulators to adopt permanent measures to protect consumers. In the views of the pan-European regulator, the measures which it took last August are still temporary and require a follow up on part of every watchdog in the EU.
The ESMA’s signal to national authorities is to adopt permanent measures. The supranational financial watchdog is strongly committed to enforcing its stricter regulatory regime for European companies.
Another Three Months
Just as the previous two extensions have been, the decision will take effect tomorrow and is for another period of three months. The pan-European regulator is highlighting in its decision that datasets provided from national regulators have been consistent with the desired effects of the regulatory framework.
Several national regulators across Europe have already adopted permanent intervention measures. and took the lead late last year, joined later by the Netherlands. The to make the temporary restrictions on CFDs permanent.
Poland on its part is an intermediate group of traders between professional and retail investors. Other countries have not been very vocal about their intentions, but the majority of firms in the EU are likely to follow up on ESMA’s regulatory framework without any changes over the coming quarters.
Offshore Growth
In the meantime, brokers operating from outside of the EU have been on-boarding an increasing number of clients from the region. The Australian Securities and Investments Commission (ASIC) has highlighted in its official communications with Australian brokers that it is on their process of welcoming EU clients.
The newly passed in Australia are likely to harmonize the regulatory framework in the land down under with that across the globe and contain offerings with aggressive leverage. While ASIC-regulated brokers have been the traditional choice for EU traders, other alternatives are also available.
Swiss brokers are , while offshore firms are aggressively marketing their offerings with much higher levels.
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