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ESMA renews binary option ban

ESMA has confirmed the ban on binary options will remain in place for a further three months. The current ban, which prohibits marketing, distribution or sale of binary options to retail clients, expires on 2 October.

ESMA has reviewed the specific features of certain binary options which make them less risky and as a result is excluding from the scope of the ban:

  • binary options for which the lower of the two predetermined fixed amounts at least equals the total payment the client makes; and
  •  binary options that meet all the conditions of (a) having maturity of at least 90 days (b) having an approved prospectus, compliant with the Prospectus Directive, available to the public and (c) not exposing the provider to market risk and the provider and its group entities do not make a profit or loss from it other than previously disclosed charges and commissions.

Emma Radmore