Land Prime's homepage says your balance resets to zero automatically if losses run past it. Clause 30 of the contract says you agree to repay negative balances caused by a volatile market open on news.
Negative balance protection is a limit that stops you owing more than you put in. Without it, one fast market move can leave you owing the broker money on top of your deposit.
Why this matters
You can owe Land Prime money after your account is emptied. Clause 16 adds interest at 3 percentage points over its bank's prime rate, plus the cost of collecting from you, including legal fees.
Exhibit 1Every flagged clause gets its own number so you can point at this one. The number does not change, so a link to it keeps working.CriticalHow much this clause can cost you, in our reading. Critical can take your money or your profit. Warning can delay or limit it. Notice is simply worth knowing before you sign.Harder than usualHow ordinary this wording looks next to the contracts we read. This is our reading of the clause, not a count of other brokers.3%The figure this clause puts a number on, taken from the broker's own words.
Customer also agrees to replenish Land Prime Ltd. of any negative balances caused by volatile environments triggered during the market open when the financial news breaks out.
Firms licensed by the FCA, CySEC or under ESMA rules must give retail CFD clients negative balance protection, so a client cannot lose more than the money in the account. This contract requires the client to top the account back up.
Land Prime is not licensed by these regulators, so this is a comparison of practice, not a finding of any breach.
- Worse together with Exhibit 19Read these two clauses together. Each one costs more because the other exists.Japanese pages carry the same promise as a zero cut system, and the contract that contradicts it is served to Japanese clients in English only.