FESE generally agrees with the elements proposed by ESMA to identify CFDs and binary options. However, we would like to point out that the definitions, in particular in the case of CFDs, are quite broad and could unwittingly capture financial instruments which ESMA did not intend to subject to additional investor protection measures.

This might especially be the case for securitised derivatives. While it appears that it is not ESMA’s intention to include securitised derivatives, in the absence of more specific definitions in European legislation, FESE would recommend clarifying that instruments considered as securitised derivatives that are traded on a trading venue are not under the scope of the restrictions outlined in the call for evidence. We believe there are a number of elements specific to this product class that justify this approach.

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