Revisions to the Conduct of Business Rulebook

30 Aug 2019

The MFSA has recently carried out a number of changes to Conduct of Business Rulebook (the “Rulebook”) originally issued by the Malta Financial Services Authority (“MFSA”) on the 20th of December 2017. Indeed, following ESMA’s renewal of its restrictions on the marketing, distribution or sale of contracts for differences (“CFDs”) to retail investors, the MFSA carried out the following changes:

  1. A definition of ‘Contracts for Differences’, ‘Excluded Non-Monetary Benefit’. ‘Initial Margin’, ‘Margin Close-out Protection’, ‘Negative Balance Protection’ were added to the glossary section of the Rulebook;

  2. New rules were added in Chapter 1 of the Rulebook introducing requirements applicable to investment firms who market, distribute or sell CFDs to retail clients in or from Malta; and

  3. New rules were added to provide the circumstances where the marketing, distribution or sale of CFDs to retail clients is restricted. The Rules also set out the requirements for slippage parameters, use of expert advisors and record keeping.

These measures are applicable as from the 11th of August 2019.
 

Feel free to contact us if you require any further information in relation to the new requirements.

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