Polish MoF to Limit Forex Trading Leverage as a part of its regulatory clampdown on the financial services market in Poland. Ministry of Finance comments on Polish new Forex trading leverage 50:1.
14 December, AtoZForex – The Ministry of Finance in Poland has submitted a draft of a new legislation for the Forex market participants. The proposed law covers the matter of the allowed maximum leverage on Forex trading. This time, the MoF decided to limit the maximum leverage from 100:1 to 50:1.
Indeed, Polish financial regulator has been steadily tightening the regulations for the financial services market participants across the country. The newest addition to the Polish financial services operation framework has been prepared on the 8th of December 2017, according to the online reports.
Ministry of Finance comments on Polish new Forex trading leverage 50:1
In fact, the draft of the new maximum leverage on Forex trading aims to limit the ratio to 50:1. However, there is an exclusion – in case a customer has carried out at least 40 transactions during the last 24 months, then the Polish brokers can lift the leverage to 100:1.
This step from the Polish financial regulators highlights their intentions to follow the best regulatory practices. The watchdog’s efforts signal the lifted emphasis on the protection of the investors’ community. Also, it places the Polish Forex regulations on par with other countries.
Following the news about the Polish new Forex trading leverage, I have reached out to the Ministry of Finance in Poland for additional insights on the case. The representative from the MoF has stated:
“The Ministry of Finance today published a new proposal, whereby it leaves the maximum leverage on FX trading at 100:1 but only for experienced users (ie. users that may prove to have had a minimum 40 transactions on financial instruments in the past 24 months) ; for other users the maximum leverage would be decreased to 50:1.”
Poland tightens the regulations
This July, Polish regulatory bodies have announced their plans to cut the maximum leverage from the current 1:100. The plan was to cut the existing leverage with a margin of 1 percent, and to 1:25 with a margin of 4 percent. The Polish Ministry of Finance presented a draft “Act amending the Act on the supervision of financial markets.”
The document comprised proposals for amendments to regulations on the Forex market. This among other things, limiting leverage for retail traders of this market. The new KNF Polish Forex regulation would require all of the Forex brokers in Poland to follow the broader mandate to publicly alert investors about any activity without authorization.
In fact, the current legislation enables Polish officials to impose a fine of up to PLN 5 million on firms that provide financial services without any authorization across the country. Reportedly, the authorities are considering lifting the penalties.
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