XTB lost to the Administrative Court. Will there be a complaint to the NSA?

The Voivodship Administrative Court in Warsaw dismissed the complaint of the largest Polish broker and upheld almost PLN million of the fine imposed by the Polish Financial Supervision Authority. X-Trade Brokers brokerage house he disagrees with this decision and will probably use all legal possibilities to prove his innocence. We will wait for 30 days to justify the court's decision.

Penalty imposed on XTB

Recall: in September 2018 year The Polish Financial Supervision Authority decided to impose a huge penalty on XTB, amounting to PLN 9,9. This is the effect of using the so-called "Asymmetric deviation mechanism". This was to happen from January 2014 to May 2015 when investing in CFDs. The Polish Financial Supervision Authority stated that by acting in this way, the broker did not take into account the best interests of its clients.

The commission is sure of its own, but ...

In the communication of the Polish Financial Supervision Authority we could read, among other things: "Ww. the entity monitored price deviations ensuring that transaction prices do not differ significantly from the prices of the underlying instruments. X-TRADE BROKERS used in the transaction systems asymmetric setting of the deviation parameter, introducing a price deviation restriction at the moment of placing the order from the price at the moment of order execution, in the case of a change in the price favorable for the client, while leaving the price of the order unlimited order, in the event of a price change of a given item to the disadvantage of the customer ".

Interestingly, no specific calculation of possible losses of XTB clients was made. The Polish Financial Supervision Authority estimated them at the level from 8 to 23,5 million. The discrepancy is very large, but it results from the problem of determining what kind of slips would be recorded in reality. It is not known what real slip would occur if manipulation took place.  KNF also accuses XTB of deliberately delaying client orders.

XTB disagreed with this assessment. He prepared expert opinions, which directly indicate that the mechanism had no impact on the financial results of its clients and the asymmetric deviation parameter in the execution of orders was the most acceptable. The company decided to appeal to the Voivodship Administrative Court in Warsaw.

6 June 2019 WSA dismissed the appeal lodged by the broker, but it is worth remembering that the decision is not yet legally binding. Therefore, the company has the full right to use the further legal path and file a cassation complaint to the Supreme Administrative Court. Only when the NSA has dismissed the complaint, the penalty imposed by the KNF will become legally valid.

XTB comment:

- The Provincial Administrative Court today  in Warsaw, dismissed our complaint against KNF decisions regarding the imposition of a fine of PLN 9,9 on the company. The verdict is not legally binding.

We disagree with the court's decision and plan to apply for the service of the judgment with justification. After receiving the justification, we will decide on a possible cassation appeal to the Supreme Administrative Court - informs Anna Drozd, PR Manager of X-Trade Brokers DM SA