Response to ASIC Announcement
23 October 2020
Plus500 Ltd.
("Plus500", "the Company" or "the Group" )
Response to ASIC announcement
Plus500, a leading technology platform for trading Contracts for Difference ("CFDs") internationally, provides an update following today's anticipated announcements from the Australian Securities & Investment Commission, ("ASIC") in which it outlined its proposed regulatory changes for the CFD industry in Australia, which will be applied from 29 March 2021 . The principal changes are:
· leverage limits on the opening of a position by a retail client;
· a margin close-out rule on a per account basis;
· negative balance protection on a per account basis;
· a restriction on the incentives offered to trade CFD's; and
· a standardised risk warning.
The Company appreciated the opportunity to work with ASIC throughout the consultation process and fully supports today's announcement, in the interests of raising standards in the industry, noting that it already operates in compliance with most of these regulatory changes, in particular:
· Plus500 has always offered negative balance protection to all customers in all its markets;
· the Company has always offered maintenance margin levels to all customers in all its markets;
· prominent risk disclosures are provided through all the Company's marketing campaigns and on the Company's website.
Plus500 welcomes these changes proposed by ASIC, which the Board believes will enhance the CFD trading landscape and provide important additional protections for consumers.
The Board will continue to assess the potential impact on future years, but believes that such impact is already incorporated in the compiled analysts' consensus forecasts for Plus500 for FY 2021.
David Zruia, CEO, commented:
"We welcome these new regulations being introduced by ASIC, which are broadly as expected following the announcement of its consultation in August 2019. The regulations will be rapidly and seamlessly adopted by Plus500, supported by the efficiency of our industry-leading proprietary technology. The Company is already compliant in most of the areas covered by the proposed regulation and we will further adapt our business model where additional changes are required. These changes, which are similar in spirit and effect to the regulatory changes implemented in Europe in 2018, act to bring further stability and uniformity to global industry standards.
"We believe these regulatory changes will further enhance the CFD trading landscape by benefitting the compliant industry leaders, such as Plus500, and helping to protect our customers as they access our products. In the meantime, we continue to aim to grow and diversify our business by introducing new product lines, and developing our presence in new geographies. "
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For further details Plus500 Ltd
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About Plus500
Plus500 operates a proprietary technology platform for individual customers to trade CFDs internationally. The Group offers more than 2,500 different underlying global financial instruments, comprising equities, indices, commodities, options, ETFs, foreign exchange and cryptocurrencies. Customers of Plus500 can trade CFDs in more than 50 countries and in 32 languages. The trading platform is accessible from multiple operating systems (Windows, iOS, Android and Surface) and web browsers. Plus500 retains operating licences and is regulated in the United Kingdom, Australia, Cyprus, Israel, New Zealand, South Africa, Singapore and the Seychelles.
Customer care is and has always been integral to Plus500, as such, customers cannot be subject to negative balances. A free demo account is available on an unlimited basis for platform users and sophisticated risk management tools are provided free of charge to manage leveraged exposure, and stop losses to help customers protect profits, while limiting capital losses. Plus500 does not utilise cold calling techniques and does not offer binary options. Plus500 shares have a premium listing on the Main Market of the London Stock Exchange (symbol: PLUS) and are a constituent of the FTSE 250 index. www.plus500.com
Forward looking statements
This announcement contains statements that are or may be forward-looking statements. All statements other than statements of historical facts included in this announcement may be forward-looking statements, including statements that relate to the Company's future prospects, developments and strategies. The Company does not accept any responsibility for the accuracy or completeness of any information reported by the press or other media, nor the fairness or appropriateness of any forecasts, views or opinions express by the press or other media regarding the Group. The Company makes no representation as to the appropriateness, accuracy, completeness or reliability of any such information or publication.
Forward-looking statements are identified by their use of terms and phrases such as "believe", "targets", "expects", "aim", "anticipate", "projects", "would", "could", "envisage", "estimate", "intend", "may", "plan", "will" or the negative of those, variations or comparable expressions, including references to assumptions. The forward-looking statements in this announcement are based on current expectations and are subject to known and unknown risks and uncertainties that could cause actual results, performance and achievements to differ materially from any results, performance or achievements expressed or implied by such forward-looking statements. Factors that may cause actual results to differ materially from those expressed or implied by such forward looking statements include, but are not limited to, those described in the risk factors. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such entity and the environment in which each will operate in the future. All subsequent oral or written forward-looking statements attributed to the Company or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. Each forward-looking statement speaks only as at the date of this announcement. Except as required by law, regulatory requirement, the Listing Rules and the Disclosure Guidance and Transparency Rules, neither the Company nor any other party intends to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
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