ESMA Eyes Marketing of Financial Products in EU, Focuses on Risky Instruments
The European Securities and Markets Authority (ESMA), the supervisor and regulator for financial markets in the European Union (EU), announced on Monday the launch of a review of financial products promotion in different EU countries.
ESMA Will Review Marketing Practices of Financial Products
According to the press release, in 2023, ESMA wants to work with national competent authorities (NCAs) to confirm that Markets in Financial Instruments Directive (MiFID) II is correctly applied, in terms of marketing financial products in the EU territories.
The NCAs will examine whether the form of promotion and advertising of financial products is "fair, clear and non-misleading" and how companies choose the targeted audience for their marketing content. ESMA wants to emphasize the more complex and risky investment products, most likely including cryptocurrency and contracts for difference (CFDs).
"ESMA is aware of the key role that marketing communications and advertisements can play in determining consumer behaviour and influencing investment decisions and is therefore launching this exercise to assess the application by investment firms and credit institutions of the MiFID II requirements on marketing communications," ESMA commented.
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