Binary options

European Regulator ESMA Extends Ban on Binary Option for another Three Months Period

This is the third extension of the ban on marketing, selling and distribution of binary options to retail clients in the European Union

esmaThe European regulator, European Securities and Markets Authority (ESMA) has once again extended the ban on binary options for another three months. The move is not likely to surprise many industry participants, and with this, it marks the third extension which was implemented way back in July 2018.

This time, the third extension of the ban will start from the 2nd April 2019 and will remain until 2nd July 2019. However, it is likely that the ban on binary options is likely to continue much beyond the end of the third extension. The ban prohibits marketing, selling, and distribution of binary options to retail clients of the European Union. The reason for the extension of the ban is the same as it was given previously.

“ESMA has carefully considered the need to extend the intervention measure currently in effect. It considers that a significant investor protection concern related to the offer of binary options to retail clients continues to exist.”

According to ESMA, the decision to extend the ban was reached after the meeting of its Board of Supervisors, which was held on 14th February 2019.  Next steps which were also discussed as per the update given in the ESMA website:

ESMA intends to adopt the renewal measure in the official languages of the EU in the coming weeks, following which ESMA will publish an official notice on its website.  The measure will then be published in the Official Journal of the EU and will start to apply from 2 April 2019 for a period of three months.

It is more likely that ESMA will continue to renew its prohibition on binary options and CFDs until it comes out with a permanent policy in place. Until then, it is more likely that the prohibition will continue indefinitely.