On 30 September 2019, ESMA issued an opinion on the national product intervention measures, in response to the Cyprus Securities and Exchange Commission’s announcement on 27 September.

Cyprus national product intervention measures

The proposed Cyprus national product intervention measures broadly reflect the temporary intervention measures which ESMA had previously taken under MiFIR restricting the marketing, distribution or sale to retail clients of contracts for difference (CFDs). The last of these measures expired on 31 July 2019. CySEC notified ESMA of the proposed national measures one month after ESMA’s measures expired and they are expected to take effect from 2 October 2019.

CySEC notified ESMA that the proposed national measures are the same as the expired measures at national level except that they:

1. do not apply to CFD providers that are credit institutions authorised under the EU Capital Requirements Directive 2013/36/EU (CRD IV);
2. vary the level of protection provided to retail clients that are resident of other Member States in which a product intervention measure relating to CFDs applies; and
3. include minor amendments to the standard risk warnings.

ESMA’s input

ESMA’s opinion concludes that: 

1. the national measures are justified and proportionate except for the variable level of protection;
2. it is necessary for the national competent authorities of other Member States to take product intervention measures that are at least as stringent as ESMA’s measures; and
3. it is necessary for the Central Bank of Cyprus to take product intervention measures that are at least as stringent as ESMA’s measures in respect of the marketing, distribution or sale of CFDs by credit institutions in or from Cyprus.

CySEC’s announcement is available here.

ESMA’s opinion is available here.