Is There a Loophole Excluding CFDs and Forex from OTC Trade Reporting in Australia?

Despite what some brokers apparently believe, ASIC expects CFDs and margin FX to be reported and will use their enforcement powers to enforce this rule.

Through TRAction Fintech’s ongoing interaction with the FX and CFD industry in Australia, it has come to our attention that a handful of brokers are of the opinion that Contracts for Difference (CFDs) and margin foreign exchange (FX) are not covered in the OTC Trade Reporting Rules, therefore meaning that they do not need to report to an Australia Derivative Trade Repository (ADTR) buy xenical. Brokers have either received this advice or have come to their own conclusion that CFDs and margin FX are not subject to reporting requirements.

While the handful of brokers that have decided not to report are understandably quiet on their reasons for not reporting, we have learnt that this view likely stems from omissions in the description of products covered in ASIC Regulatory Guide (RG) 251. On page 28 of RG251 there is a table headed ‘Products that must be reported’.

The table for foreign exchange derivatives lists:

  • Swaps
  • Forwards
  • Non-deliverable forwards
  • Non-deliverable options
  • Options
  • Exotic options
  • Precious metals swaps

The table for equity derivatives lists:

  • Equity swaps
  • Equity index swaps
  • Equity options

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