On 22 February 2019 FCA issued a statement on its website concerning the onshoring of the European Securities and Markets Authority’s (ESMA) temporary intervention measures prohibiting binary options and restricting contract for difference products (CFDs) sold to retail clients.

The FCA reminds firms that they are required to comply with ESMA’s decision notices until they expire on 1 April 2019 for binary options and 30 April 2019 for CFDs.

The FCA further reminds firms that it has previously published two consultation papers in December 2018 to make ESMA’s temporary product intervention measures permanent in the UK.  The FCA’s proposals are the same in substance as ESMA’s, although it is proposing to apply rules to closely substitutable products. The FCA consultations closed on 7 February 2019. The FCA expects to publish a Policy Statement containing final rules in March 2019 for binary options, and April 2019 for CFDs and CFD-like options. The FCA expects the final rules to apply very shortly after publication to coincide with the dates that ESMA’s restrictions expire.

The FCA states that if it cannot finalise its domestic approach prior to ESMA’s existing interventions ceasing to have effect in the UK, it will consider adopting temporary product intervention measures to replicate EMSA’s.