ESMA issues opinions on product intervention measures by Sweden, France and the United Kingdom
The European Securities and Markets Authority (ESMA) has today issued three opinions on product intervention measures taken by the National Competent Authorities (NCAs) of Sweden, France and the United Kingdom. ESMA’s opinion finds that the proposed measures are justified and proportionate and that it is necessary for NCAs of other Member States to take product intervention measures that are at least as stringent as ESMA’s measures.
ESMA has issued opinions on national product intervention measures from:
- The Financial Conduct Authority of the United Kingdom (FCA) - Opinion on the proposed product intervention measures relating to contracts for differences;
- The Autorité des Marchés Financiers of France (AMF) - Opinion on the proposed product intervention measures relating to contracts for differences;
- The Finansinspektionen of Sweden (FI) - Opinion on the proposed product intervention measures relating to contracts for differences.
ESMA’s opinion on the UK proposed measures also concludes that the measures are justified and proportionate and qualifies this conclusion in relation to:
(i) the FCA’s proposal not to apply the national restrictions to CFD-like option providers authorised in other Member States other than through a UK branch or tied agent in respect of the sale or distribution of those products to UK retail clients; and
(ii) the FCA’s proposal to apply a 30:1 leverage limit for CFDs referencing certain government bonds, instead of the 5:1 leverage limit in ESMA’s measures.
In accordance with Article 43(3) of MiFIR if a competent authority takes actions contrary to an opinion adopted by ESMA, it shall immediately publish on its website a notice fully explaining its reasons for so doing.
NCAs may take product intervention measures in accordance with Article 42 of Regulation (EU) No 600/2014. At least one month before a measure is intended to take effect, an NCA must notify all other NCAs and ESMA of the details of its proposed measure and the related evidence, unless there is an exceptional case where it is necessary to take urgent action.
In accordance with Article 43 of Regulation (EU) No 600/2014, ESMA performs a facilitation and coordination role in relation to such product intervention measures taken by NCAs. After receiving notification from an NCA of its proposed measure, ESMA must adopt an opinion on whether the proposed measure is justified and proportionate. If ESMA considers that the taking of a measure by other NCAs is necessary, it must state this in its opinion.
The opinions that ESMA previously issued on proposed national product intervention measures are published on its website.