Compliance
Are Prop Firms Legal in Australia? ASIC's Position
Prop firms and Australia: what ASIC has said about prop trading as a CFD distribution channel, and what founders serving Australians should ask.
- By PipValley Editorial
- Published
- 3 min read
Australia matters to prop firms for two reasons: it has an active retail trading audience, and its regulator, ASIC, is one of the most active in the world on CFDs. Firms that ignore that combination tend to learn about it late.
Most forex and CFD prop firms sell simulated CFD evaluations, which is why ASIC's view of CFD distribution is the relevant lens. A firm that also routes traders to a partner broker, or copies their trades into live accounts, moves closer to the activity ASIC already supervises, and that link is the first thing an Australian lawyer will want to understand.
What has ASIC said?
In August 2024, ASIC told Finance Magnates that it "is monitoring the emergence of 'prop trading' firms or services relating to CFD trading", and named "the distribution of CFDs by issuers via emerging channels, such as 'prop trading' services" as an area of future focus. Those remarks did not say whether evaluation firms need an Australian financial services licence.
In early 2026, ASIC published its report on CFD issuers' distribution practices and announced nearly $40 million in refunds to investors after the CFD sector fell short. That action targeted CFD issuers, not prop firms, but it shows where ASIC's attention sits.
What should a founder ask?
- Does offering simulated CFD evaluations to Australians raise a licensing question for our structure?
- Does a relationship with a CFD broker (for example, routing traders to a broker or A-booking) change that?
- How should we describe payouts and results to Australian customers?
- For crypto evaluations: ASIC has said many crypto assets are financial products under current law; does that touch our product?
Whatever the answer, the habits that protect you are the same everywhere: label trading as simulated, publish rules before purchase, don't let affiliates make income claims, and keep a restricted-countries list you can update the day your advice changes.
Questions
Do Australian traders use prop firms?
Yes, Australians are a common customer group for forex and CFD prop firms. Serving them is a legal question for an Australian lawyer, given ASIC's stated interest in prop trading as a CFD channel.
Has ASIC banned prop firms?
No. As of October 2026 we found no ASIC ban or action aimed at an evaluation-model prop firm. ASIC said in 2024 it is monitoring prop trading as an emerging CFD distribution channel.
Can an Australian company run a prop firm?
Australian companies can operate businesses of many kinds; whether your evaluation product needs a licence is the question. Ask an Australian lawyer before launch and before marketing locally.
Sources
Illustrative figures, not a forecast. Nothing on this site is legal, tax or financial advice. PipValley is a web design studio; we don’t sell challenges, run trading accounts or provide trading platforms. Spotted something out of date? Tell us and we’ll fix it with the date.
Keep reading
Related guides.
Are Prop Firms Regulated? The State of Play in 2026
Do Prop Firms Need a License? What to Ask a Lawyer
Will Prop Firms Be Regulated? Signals for Founders
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