ASIC seeks to extend and amend CFD consumer protections
The Australian Securities and Investments Commission (ASIC) is seeking feedback on its proposal to extend and amend the consumer protection measures governing contracts for difference (CFDs), with the product intervention order (PIO) proposed to remain in place for a further 10 years.
The updates are designed to preserve protections that have materially reduced investor harm while modernising the PIO to ensure it treats products with the same economic characteristics and risks as CFDs consistently, whether they are settled in cash, by set-off or through the transfer of digital assets.
Industry has four weeks to provide feedback on ASIC’s proposals.
ASIC is inviting feedback from CFD issuers, industry bodies, consumer representatives and other stakeholders on the proposed extension and amendments to the product intervention order (PIO).
The proposed PIO would:
ASIC is also seeking feedback on whether CFDs over options that expose retail clients to losses greater than the premium should continue to be available to retail investors.
The regulator is seeking the feedback on the proposed extension and amendments and on the separate CFDs over options issue by 5pm (AEDT) on 9 November 2026.
Subject to Ministerial approval, the extended CFD PIO would remain in force until 2037 unless revoked earlier.
The CFD PIO commenced on 29 March 2021 and is due to expire on 23 May 2027.
On 6 April 2022, ASIC extended the CFD PIO until 23 May 2027. Data collected to support that extension showed substantial reductions in retail harm during the first six months of operation, including significant reductions in:
The CFD PIO provides four key protections: leverage limits, standardised margin close-out arrangements, negative balance protection and prohibits certain inducements.
In January 2026, ASIC secured the return of nearly $40 million to more than 38,000 retail investors and drove substantial compliance improvement across Australia’s CFD sector following a whole of industry review.
The review drove widespread improvements in issuers’ target market determinations, customer onboarding questionnaires, reporting compliance and monitoring of customer trading outcomes.
The updates are designed to preserve protections that have materially reduced investor harm while modernising the PIO to ensure it treats products with the same economic characteristics and risks as CFDs consistently, whether they are settled in cash, by set-off or through the transfer of digital assets.
Industry has four weeks to provide feedback on ASIC’s proposals.
ASIC is inviting feedback from CFD issuers, industry bodies, consumer representatives and other stakeholders on the proposed extension and amendments to the product intervention order (PIO).
The proposed PIO would:
- modernise the definition of CFDs to also include CFDs that are settled through the transfer of digital assets
- clarify how initial margin requirements apply to CFDs over options
- confirm that initial margin requirements must be applied separately to each CFD and cannot be reduced by netting opposing positions
- clarify conditions applying to permitted discounts and educational or research tools, and
- update terminology from ‘cryptoasset’ to ‘digital asset’.
ASIC is also seeking feedback on whether CFDs over options that expose retail clients to losses greater than the premium should continue to be available to retail investors.
The regulator is seeking the feedback on the proposed extension and amendments and on the separate CFDs over options issue by 5pm (AEDT) on 9 November 2026.
Subject to Ministerial approval, the extended CFD PIO would remain in force until 2037 unless revoked earlier.
The CFD PIO commenced on 29 March 2021 and is due to expire on 23 May 2027.
On 6 April 2022, ASIC extended the CFD PIO until 23 May 2027. Data collected to support that extension showed substantial reductions in retail harm during the first six months of operation, including significant reductions in:
- client losses: reduced 91%, from $372 million to $33 million aggregate net loss per quarter
- margin close outs: decreased 87% per quarter, and
- active retail accounts: decreased 29%, from 504,905 to 357,841.
The CFD PIO provides four key protections: leverage limits, standardised margin close-out arrangements, negative balance protection and prohibits certain inducements.
In January 2026, ASIC secured the return of nearly $40 million to more than 38,000 retail investors and drove substantial compliance improvement across Australia’s CFD sector following a whole of industry review.
The review drove widespread improvements in issuers’ target market determinations, customer onboarding questionnaires, reporting compliance and monitoring of customer trading outcomes.