- XM serves retail clients across the European Union and EEA exclusively through Trading Point of Financial Instruments Ltd, a Cyprus Investment Firm regulated by CySEC under licence number 120/10
- Under MiFID II cross-border passporting, Trading Point of Financial Instruments Ltd is notified to host EEA regulators including BaFin (Germany), KNF (Poland), CNMV (Spain), AMF (France) and CONSOB (Italy)
- All EEA retail accounts enforce permanent ESMA and national CFD rules: 30:1 leverage cap on major FX pairs, 20:1 on gold and major indices, 50% margin close-out, negative balance protection and a strict ban on retail trading bonuses
- Eligible retail clients of Trading Point of Financial Instruments Ltd are covered by the Cyprus Investor Compensation Fund (ICF) up to the lower of 90% of the covered claim or €20,000
- Unlike XM, Exness's CySEC entity (Exness (Cy) Ltd) does not onboard retail clients in the EU/EEA
- Quick Decision Framework
- Short Answer
- Detailed Explanation
- Example
- Common Mistake
- Professional Tip
- How CySEC Licence 120/10 Passports Across Major European Markets
- Short Answer
- Detailed Explanation
- Statutory Protections on an XM Europe Account (ESMA + CySEC ICF)
- Short Answer
- Detailed Explanation
- Common Mistake
- XM Europe Account Types and Why Ultra Low Wins in the EU
- Short Answer
- Detailed Explanation
- Example
- SEPA EUR & Local EEA Funding and Withdrawals
- Short Answer
- Detailed Explanation
- XM Europe vs Exness and Other EEA Alternatives
- Short Answer
- Pre-Deposit Checklist for European Traders
- Glossary
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Quick Decision Framework#
Short Answer
For retail traders resident in the European Union and European Economic Area (Germany, Poland, Spain, France, Italy, Netherlands, Austria, Greece, Sweden, Romania, Czech Republic, and Ireland), XM operates through Trading Point of Financial Instruments Ltd, regulated by the Cyprus Securities and Exchange Commission (CySEC) under Licence No. 120/10. Unlike offshore entities, an XM EU account gives you MiFID II regulatory supervision, segregated EEA client banking, mandatory negative balance protection, 50% margin close-out, Cyprus Investor Compensation Fund (ICF) coverage up to €20,000, and tight spread-only pricing on the Ultra Low account—with no retail bonuses allowed under EU law.
Detailed Explanation
Many European traders get confused when reading global broker reviews written for non-EU audiences that talk about 1:1000 leverage or welcome bonuses. Inside the EEA, retail CFD trading is governed by MiFID II and permanent national product-intervention orders enforced by CySEC and host regulators (BaFin, KNF, CNMV, AMF, CONSOB, AFM). Furthermore, one of XM's biggest global competitors—Exness—does not onboard retail clients under its CySEC entity (Exness (Cy) Ltd). That makes Trading Point of Financial Instruments Ltd (CySEC 120/10) our primary verified retail route across EEA country hubs.
Example
A retail trader in Warsaw or Frankfurt signs up with XM, completes the mandatory MiFID II appropriateness questionnaire, and contracts with Trading Point of Financial Instruments Ltd (CySEC 120/10). Instead of relying on promotional credit (which is banned across the EU), the trader opens an Ultra Low account in PLN or EUR, funds via SEPA or local Polish banking with $5 equivalent minimum deposit, and trades EUR/USD and GER40 under 30:1 / 20:1 leverage caps.
Common Mistake
Attempting to register through a non-EU offshore portal via VPN from Germany, Spain, or Poland to chase 1:500 leverage—which violates the broker's residency compliance, risks account closure during KYC address verification, and forfeits MiFID II and Cyprus ICF protections.
Professional Tip
Always verify Trading Point of Financial Instruments Ltd (Licence 120/10) directly on the CySEC Register and in your national host regulator's EEA passport register before making your first SEPA transfer.
How CySEC Licence 120/10 Passports Across Major European Markets#
Short Answer
Under Article 34 of MiFID II, a Cyprus Investment Firm (CIF) authorised by CySEC can provide cross-border investment services across all EEA member states after official regulator-to-regulator notification—while still respecting host-country retail CFD marketing and conduct rules.
Detailed Explanation
Here is how Trading Point of Financial Instruments Ltd (CySEC 120/10) connects to the five largest EEA retail markets:
| EEA Country | Host National Regulator | How to Verify the Passport Locally | Country-Specific Conduct Notes | Dedicated Country Hub |
|---|---|---|---|---|
| Germany (DE) | BaFin (bafin.de) | Listed in BaFin's Unternehmensdatenbank as an EEA cross-border provider (§ 74 WpIG) | BaFin's permanent CFD Act of 23 July 2019 bans Nachschusspflicht and bonuses; 2024 Tax Act repealed the €20k CFD loss cap | Germany Broker Guide · Germany Trading Guide |
| Poland (PL) | KNF (knf.gov.pl) | Listed in KNF's register of notified EEA investment firms | Polish/EU CFD rules restrict retail incentives; PLN and EUR base currencies available | Poland Broker Guide |
| Spain (ES) | CNMV (cnmv.es) | Listed in CNMV's Empresas de Servicios de Inversión del EEE en Libre Prestación | CNMV Circular 1/2019 & July 2023 Resolution strictly restrict retail CFD advertising and ban bonuses | Spain Broker Guide |
| France (FR) | AMF & ACPR (regafi.fr) | Searchable via the official French REGAFI financial firms register | Loi Sapin II & AMF rules enforce strict risk warnings, 30:1 cap and negative balance protection | France Broker Guide · France Trading Guide |
| Italy (IT) | CONSOB (consob.it) | Listed in CONSOB's Elenco delle imprese di investimento comunitarie senza succursale | CONSOB permanent CFD intervention order applies; foreign accounts reported in Quadro RW / RT | Italy Broker Guide · Italy Trading Guide |
Also see our hubs for the Netherlands, Austria, Greece, Sweden, Romania, Czech Republic, and Ireland.
Statutory Protections on an XM Europe Account (ESMA + CySEC ICF)#
Short Answer
Every retail client of Trading Point of Financial Instruments Ltd receives five binding statutory protections: tiered leverage caps (30:1 max), 50% account-level margin close-out, negative balance protection, segregated client funds, and Cyprus ICF cover up to €20,000.
Detailed Explanation
- ESMA / National Leverage Caps (Initial Margin):
- 30:1 (3.33% margin): Major currency pairs (
EUR/USD,GBP/USD,USD/JPY,USD/CHF,USD/CAD,EUR/GBP,EUR/JPY, etc.). - 20:1 (5.00% margin): Non-major FX pairs, gold (
XAU/USD), and major equity indices (GER40/DAX,US500,US100,UK100,FRA40,EU50). - 10:1 (10.00% margin): Commodities other than gold (such as crude oil and silver) and minor equity indices.
- 5:1 (20.00% margin): Individual equities / share CFDs.
- 2:1 (50.00% margin): Cryptocurrency CFDs (where offered under the entity).
- 30:1 (3.33% margin): Major currency pairs (
- 50% Margin Close-Out Rule: Unlike offshore accounts where stop-out occurs at 20% margin level, XM Europe is required by law to begin closing open CFD positions when your total account equity drops to 50% of required initial margin, preserving roughly half of your initial margin buffer from total wipeout.
- Negative Balance Protection: Guaranteed by statute per CFD account for retail clients; you can never owe additional funds (Nachschusspflicht is impossible).
- Cyprus Investor Compensation Fund (ICF): Under CySEC Directive DI87-07, if the CIF becomes insolvent and fails to return client money after segregation reconciliation, retail clients are covered for the lower of 90% of the covered claim or €20,000 per investor. Read our full CySEC regulation and ICF guide.
Common Mistake
Accepting an invitation or applying to be reclassified as an Elective Professional Client without understanding that professional clients lose mandatory negative balance protection, lose the 30:1 leverage guardrail, and are excluded from Cyprus ICF €20,000 compensation.
XM Europe Account Types and Why Ultra Low Wins in the EU#
Short Answer
Because EU law prohibits deposit bonuses on all accounts, XM Ultra Low (Standard or Micro) is the clear best choice for European retail traders—delivering significantly tighter floating spreads with $0 commission and a $5 equivalent minimum deposit.
Detailed Explanation
Outside the EU, some beginners choose XM's classic Standard account over Ultra Low because Standard is eligible for deposit bonuses. Inside the EEA under CySEC 120/10, no account type carries retail bonuses—meaning there is zero trade-off in choosing Ultra Low for lower trading costs:
Account Type (CySEC 120/10) | 1 Lot Contract Size | Minimum Deposit | Base Currencies | Commission | Why Choose It in Europe |
|---|---|---|---|---|---|
| Ultra Low Standard | 100,000 units | $5 equiv. (€5) | EUR, USD, GBP, PLN, HUF | $0 (Spread only) | Best all-around choice for EEA traders on EUR/USD, XAU/USD, and GER40 |
| Ultra Low Micro | 1,000 units | $5 equiv. (€5) | EUR, USD, GBP, PLN, HUF | $0 (Spread only) | Ideal for small €50–€500 accounts needing tight spreads under 30:1 margin rules |
| Standard / Micro | 100,000 / 1,000 units | $5 equiv. (€5) | EUR, USD, GBP, PLN, HUF | $0 (Wider spread) | Legacy spread tier; Ultra Low is strictly cheaper in the EU |
| Shares | 1 share | $10,000 equiv. | EUR, USD | Exchange commission | Direct share CFD portfolios |
Example
On a €500 account in Germany or Spain, a 0.01 Standard lot of EUR/USD (1,000 units) requires €33.33 of margin at 30:1. On an Ultra Low Micro account, 0.10 Micro lots equals 100 units, requiring just €3.33 of margin at 30:1—giving beginners fine-grained position sizing even under strict ESMA leverage caps! Run your own numbers on the lot size calculator.
SEPA EUR & Local EEA Funding and Withdrawals#
Short Answer
Open your account in EUR (or PLN / HUF if banking in Poland or Hungary) and fund via a same-name SEPA transfer or verified local EEA payment rail inside the XM Members Area.
Detailed Explanation
- Zero FX Conversion Drag: Funding a
EURXM account from a Eurozone bank account via SEPA eliminates round-trip currency conversion fees. Read our XM account base currency guide. - MiFID II Appropriateness & KYC: Before your first deposit is accepted under
CySEC 120/10, you must complete the MiFID II appropriateness assessment (testing your understanding of leverage, margin close-out, and CFD risk) and upload your EU national ID/passport and proof of residence. - Return-to-Source Withdrawals: All withdrawals follow strict EU AML rules, returning to the same-name card or SEPA IBAN used for the initial deposit.
XM Europe vs Exness and Other EEA Alternatives#
Short Answer
Within our tracked partner ecosystem, XM (Trading Point of Financial Instruments Ltd, CySEC 120/10) is the active retail EEA broker, whereas Exness (Exness (Cy) Ltd, CySEC 178/12) does not accept retail clients in the EU/EEA.
| Comparison Point | XM Europe (Trading Point of Financial Instruments Ltd) | Exness Europe (Exness (Cy) Ltd) |
|---|---|---|
| CySEC Licence Number | 120/10 | 178/12 |
| Accepts EU/EEA Retail Clients? | Yes (Passported across DE, PL, ES, FR, IT, NL, AT, GR, SE, RO, CZ, IE) | No (RetailClients: false — institutional/B2B only) |
| Minimum Retail Deposit | €5 (or currency equivalent) | Not available to EEA retail |
| Micro-Lot / Small-Account Support Under 30:1 | Yes (Ultra Low Micro, 1,000 units per lot) | Not available to EEA retail |
| Platforms | MT4, MT5, XM WebTrader, XM Mobile App | Not available to EEA retail |
Pre-Deposit Checklist for European Traders#
- Verify Trading Point of Financial Instruments Ltd (Licence 120/10) on the CySEC Register and in your national regulator's EEA passport database (
BaFin,KNF,CNMV,AMF,CONSOB). - Confirm your Client Agreement classifies you as a Retail Client under
Trading Point of Financial Instruments Ltd. - Choose Ultra Low Standard or Ultra Low Micro in
EUR(orPLN/HUFwhere applicable) so you get the lowest spread cost without FX conversion fees. - Complete the MiFID II appropriateness test and full KYC before sending a same-name SEPA transfer.
- Keep annual EUR/PLN account statements for your national tax declaration (
Anlage KAP,PIT-38,IRPF,2042-C / 3916, orQuadro RT / RW).
Glossary#
- CySEC (Cyprus Securities and Exchange Commission): The EU national competent authority in Cyprus supervising Cyprus Investment Firms (
CIFs), includingTrading Point of Financial Instruments Ltd(120/10). - MiFID II Passport: The legal mechanism allowing an investment firm authorised in one EEA member state to provide regulated services in other EEA states.
- Appropriateness Test: A mandatory MiFID II questionnaire assessing whether a prospective retail client understands the risks of leveraged CFDs before onboarding.
- 50% Margin Close-Out: The ESMA-mandated rule requiring automatic closure of retail CFD positions when account equity falls to 50% of required initial margin.
- Cyprus ICF: The statutory Investor Compensation Fund covering retail clients of CySEC-regulated CIFs up to the lower of 90% of the claim or €20,000.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. A high percentage of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. This review is independent educational research, not investment, legal or tax advice.
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