National Commission for Financial Markets outlines Moldovan law banning binary options and curbing leveraged derivative distribution to retail investors

The National Commission for Financial Markets published an overview of amendments approved by Moldova’s Parliament to the capital markets framework that introduce tighter protections for retail (non-professional) investors from complex, leveraged derivatives and related aggressive marketing practices. The legal changes prohibit the promotion, sale and distribution of binary options. They also restrict marketing, sale and aggressive distribution to non-professional clients of derivative instruments traded via electronic trading platforms that involve leverage linked to the underlying asset, with specific prohibitions for contracts for difference (CFDs) including conditional bonuses, use of call centres, promotion via social media and radio/television, and provider arrangements that profit from client losses. The measures exclude derivatives admitted to trading on regulated markets or within multilateral trading facilities (MTFs); breaches are treated as a criminal offence, and the National Commission for Financial Markets can issue public alerts and block advertising deemed misleading. The Commission noted that the rules target product and service providers and do not limit investors’ ability to independently access authorised electronic trading platforms, including on regulated markets. It also indicated it will continue issuing warnings about unauthorised entities and seeking the cessation of misleading advertising, and urged investors to verify whether platform operators are supervised by the Commission or an overseas supervisor and to consult IOSCO alerts.