Regulatory Alerts2020-09-01 | Guidelines on the General Administrative Act of 23 July 2019 regarding Contracts for Difference (CFD)Guidelines on the General Administrative Act of 23 July 2019 regarding Contracts for Difference (CFD)
The Federal Financial Supervisory Authority (BaFin) has restricted the marketing, distribution, and sale of contracts for difference to retail investors in Germany through a General Administrative Act dated 23 July 2019. These guidelines mandate that providers guarantee initial margin protection, enforce mandatory closeout and negative balance protections, ban inducement bonuses, and display standardized provider-specific risk warnings across all direct and indirect communications. Providers retain full responsibility for ensuring third-party advertisers comply with these disclosure requirements, subject to ongoing BaFin monitoring and administrative fines for non-compliance.
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