The Australian Securities and Investments Commission (ASIC) will review Australia’s contracts for difference (CFD) leverage limits and consult on extending and amending its existing product intervention order before it expires on 23 May 2027.
The order applies to every Australian financial services licensee issuing CFDs to retail clients. It currently caps leverage at 30:1 for major foreign exchange pairs and 2:1 for crypto CFDs. The framework also requires margin close-out protection, negative balance protection and standardised risk warnings, while banning certain inducements.
Planned review and consultation process
According to ASIC’s regulatory timetable, a review of the CFD order will begin in the third quarter of 2026, followed by public consultation in the fourth quarter. ASIC then plans to seek ministerial approval in the first quarter of 2027. The instrument will either be extended or allowed to expire in the second quarter of 2027.
ASIC’s corporate plan goes beyond a general commitment to review, stating that it will consult on proposals to amend and extend the CFD order. Neither the timetable nor the corporate plan identifies which specific provisions may change. The consultation follows a wider review of online trading platforms that expanded ASIC’s distribution scrutiny beyond over-the-counter (OTC) derivatives.
ASIC first imposed the CFD order in March 2021 and extended it for five years in April 2022. The current review will determine whether the existing restrictions on retail CFDs continue beyond the present term.
Parallel capital and licensing initiatives
A separate process is in progress for the financial requirements that apply to retail OTC derivative issuers. ASIC has proposed extending that capital instrument to 2032 without changing the minimum net tangible assets test. The capital instrument is due to expire on 1 October 2027, more than four months after the CFD product order reaches its sunset date, leaving brokers to manage two regulatory processes covering different aspects of the same retail derivatives business.
ASIC has also adjusted its performance target for routine Australian financial services and credit licence applications. From 1 July 2026, it aims to finalise 80% of complete routine applications within 120 days, reduced from the previous 150-day target. Complex applications are excluded from this target.
Digital asset framework and enforcement targets
Under Australia’s new framework for digital assets, ASIC will issue guidance and set standards for digital asset platforms and tokenised custody platforms. The dedicated regime for these platforms is scheduled to commence in April 2027.
ASIC’s corporate plan also outlines enforcement objectives. The regulator plans to refer at least 25 people or companies each year to the Commonwealth Director of Public Prosecutions and to commence at least 30 civil proceedings annually.
