Where things stand
On 12 October 2026, ASIC released Consultation CS 64 Protecting retail investors: Proposed extension and amendments to the CFD product intervention order (CS 64), together with draft ASIC Corporations (Product Intervention Order Amendment – Contracts for Difference) Instrument 2026/XX (Draft Instrument).
The ASIC Corporations (Product Intervention Order – Contracts for Difference) Instrument 2020/986 (CFD PIO) commenced on 29 March 2021 and, following its extension in April 2022, is due to expire on 23 May 2027. It provides key protections for retail clients with respect to leverage limits, standardised margin close-out arrangements, negative balance protection and a prohibition on certain inducements.
ASIC considers the CFD PIO continues to operate effectively, pointing to a 91% reduction in aggregate net retail client losses per quarter in its first six months. However, retail harm remains substantial: in the 2023–24 financial year, 68% of retail clients trading CFDs made a net loss, aggregate net retail losses exceeded $458 million (including $73 million in fees) and 85% of retail clients trading CFDs over options made a net loss.
ASIC proposes to extend the CFD PIO for a further 10 years. Subject to Ministerial approval, the extended order would remain in force until 2037 unless revoked earlier.
Proposed amendments
- Initial margin for CFDs over options
CFDs over options were not contemplated when the CFD PIO was made, and ASIC's 2024–25 sector-wide review found inconsistent margin practices across issuers. ASIC proposes that:
- where the retail client's maximum loss is limited to the premium paid, the minimum initial margin is the amount of that premium
- where the maximum loss is not so limited (including short exposures to an option), the minimum initial margin is determined by applying the margin requirement for the asset, index or other reference on which the option is based. This includes CFDs that provide short exposure to an option and may expose retail clients to losses greater than the premium received.
- No netting of margin across CFDs
The Draft Instrument would confirm that the minimum initial margin must be applied separately to each CFD issued to a retail client, so that opposing long and short positions cannot be netted. ASIC identified margin netting practices during its 2024–25 review, following which 28 issuers refunded more than $36 million to affected retail clients.
- Digital asset settlement
The CFD PIO currently captures derivatives settled in cash or by set-off. ASIC proposes to modernise the CFD definition so that it also captures derivatives settled through the transfer of digital assets, where the other elements of the definition are met. The underlying may itself be a digital asset, another asset, a rate or an index. ASIC notes that some fixed-expiry crypto derivatives, including certain crypto options and futures, would remain outside the CFD PIO.
- Inducements, discounts and educational tools
ASIC proposes to tighten the existing exclusion for fee and cost discounts. A permitted discount would need to be:
- offered unconditionally, except for conditions reasonably necessary to give effect to a volume-based discount
- offered to all retail clients and prospective retail clients on substantially the same terms and conditions
- clearly and prominently displayed on the CFD issuer’s website and trading platform.
Issuers offering a permitted discount would need to keep written records of its terms, conditions, duration and manner of offer, together with evidence of compliance, for seven years. Information services and educational or research tools would only be excluded from the inducements prohibition where made accessible to all retail clients and not used as an inducement to engage in CFD-related conduct.
- Terminology
References to ‘cryptoasset’ would be replaced with ‘digital asset’, with a new definition aligned to ASIC's current drafting approach.
A separate issue: CFDs over options with uncapped losses
Separately, ASIC is seeking evidence on whether CFDs over options that expose retail clients to losses greater than the premium – potentially unlimited, depending on structure – should continue to be available to retail clients. ASIC has not decided whether these products should be prohibited or otherwise restricted, and is seeking data on client numbers, outcomes, product structures, legitimate risk-management uses and the likely impact of any restriction.
What’s next
Submissions close at 5pm (AEDT) on Monday 9 November 2026. ASIC is also seeking feedback on regulatory and compliance impacts, unintended consequences and whether any transitional period is required.