Why Europe and the UK block event contracts

A European reader who opens a US venue's page and finds the account will not open is meeting two regimes at once, run by different authorities and reaching the same result by different reasoning. One asks whether the contract is a financial instrument. The other asks whether it is a product its own law requires a licence to offer. An event contract can be caught by either, and the venues that serve the United States have been caught by both.

How it works

The first test: is it a financial instrument?

ESMA's public statement of 3 July 2026 starts from a definition: event contracts are "agreements whose financial outcome is binary (a fixed payout or no payout at all) and depends on a yes-or-no answer to a question about a future event". It then splits them.

"Not all event contracts are financial instruments. Only event contracts with an event question related to an underlying mentioned in Section C(4) to (10) of Annex I of MiFID II classify as financial instruments." Which questions those are is set by that annex, not by the category labels a venue puts on its markets.

Those that do qualify "are derivatives", and that brings in a rule from 2018. ESMA's Decision (EU) 2018/795 of 22 May 2018 temporarily prohibited the marketing, distribution or sale of binary options to retail clients across the Union; it was renewed by quarterly decisions until 1 July 2019, and in the meantime every national competent authority adopted permanent measures "mostly mirroring" it. ESMA says those national measures "are currently in place in all Member States of the EU". So, in the statement's words: "the marketing, distribution or sale to retail clients of event contracts that meet the definition of financial instruments is prohibited."

The statement closes the obvious exits:

• The name does not matter. "The commercial name provided by firms (e.g. 'event contracts') is irrelevant for the categorisation under MiFID II."
• A yield does not change the shape. Where an investor receives a coupon or reward representing interest earned on the funds paid, "the existence of such 'coupon' or 'reward' does not change the binary nature of the event contract itself."
• Selling only to professionals still needs a licence. Distributing such contracts in the EU "requires this authorisation", investment-firm authorisation under MiFID II, "irrespective of the category of clients".
• Routing around it is itself prohibited. A footnote notes that "participating in circumvention activities to the product intervention measures is prohibited".

The binary option the 2018 decision targets is defined in the statement's footnote: a derivative settled, or settleable, in cash, paying only at close-out or expiry, and paying either a fixed amount or zero depending on whether the underlying meets a condition. Certain binary options were excluded from the decision's scope. ESMA's news item of the same day frames the whole statement as a reminder to firms "of their obligation to assess whether newly offered products fall within the scope of existing product intervention measures". Nothing new was prohibited on 3 July 2026.

The UK: banned since 2019

The UK reached the same rule by its own route. The FCA's PS19/11, published on 29 March 2019, set out rules "to permanently prohibit the sale, marketing and distribution of binary options to retail consumers by firms that carry out activity in, or from, the UK", in force from 2 April 2019. It went further than ESMA's measure, "capturing all binary options, including 'securitised binary options' (as defined by ESMA), which are exempt from their ban".

The FCA has since looked at event contracts by name, without changing the rule. Its Discussion Paper DP25/3 of December 2025, open for comment until 6 March 2026, lists among speculative products "horizon contracts", which "allow consumers to speculate on future outcomes, such as macroeconomic indicators, politics, commodity prices, or event-based forecasts. Depending on how it is structured, this type of investment may meet the definition of a binary option and be banned under our legal and regulatory framework." The paper asks whether to replace its product-by-product approach with one "more risk and return centred and product agnostic". A discussion paper asks questions; it does not change the rules.

The second test: is it a product gaming law licenses?

ESMA's own footnote opens the second door: event contracts "may also classify" under national gaming legislation, and token-form contracts that are not financial instruments may be crypto-assets under MiCA.

Great Britain. The statutory gaming regulator, the UKGC, set out its view in a blog post of 4 February 2026 by its Director of Strategy. It describes a prediction market as "a platform which enables participants to trade event-based contracts on markets including financial, sports, and political events", and says that, subject to the business model, current products would appear to fall within one of its existing licence categories, the one held by the intermediary exchanges that have operated in the UK since 2000. It does not believe an operator launching in Great Britain could class its products as outside its regime, and it adds: "Current prediction market operators who are not licensed in Great Britain should take steps to ensure they are not targeting or transacting with consumers in Great Britain. There are criminal offences associated with operating without an appropriate licence here." Firms offering financial services products are, it notes, regulated by the FCA instead. It declines a view on the US: "It is not for us to comment on ongoing legal debates on the status of prediction markets in the United States or elsewhere."

So in Great Britain the two tests meet in the middle. A contract that is a binary option is under the FCA's 2019 ban; one that is not is, in the gaming regulator's view, a product its licence covers.

France. The ANJ, France's gaming authority, said on 24 February 2026 that prediction-market sites "ne sont pas autorisés" in France and are treated as unauthorised offers under its law, that the main operators had installed geoblocking at its request, and that Kalshi had done the same. On 17 July 2026 it announced that its president had, on 16 July, ordered French internet providers to block access to Polymarket. The notice gives its reasons: the earlier geoblock on financial transactions "donnant en pratique lieu à des contournements" (was being circumvented in practice); the site drew 578,751 visits and 205,057 unique visitors from France in June 2026; and its homepage, showing live prices, was "un vecteur majeur de diffusion et de promotion" of the offer. The ANJ says it blocked 1,290 URLs in 2025 under the same power.

Elsewhere. The ANJ's two notices name other European countries that have restricted or blocked prediction markets, among them Germany, Belgium, Switzerland, the Netherlands, Poland, Italy, Portugal and Spain. That list is the ANJ's summary; this page has not read those authorities' own decisions, and their reasoning may sit under either test.

What the two tests share

They are asked by different regulators, under different laws, and answered differently for different contracts. They agree on the result for a retail customer: the contract may be offered only by a firm authorised for it in that country. The UKGC's post and the ANJ's notices are both addressed to operators that are not.

That is why a block in Europe is usually not a statement about the contract's quality or about US law, and why a venue's own country list changes when a regulator acts rather than when the venue does. Why a venue is unavailable where you are covers how venues implement the block: a location check, a statement you sign, a rail that will not carry your money, or close-only status.

What you can do about it

Ask the venue which authorisation it serves your country under. A firm offering event contracts to a retail client in the EU needs either to fall outside the binary-option measures or to hold whatever the national gaming law requires. A venue that cannot name the licence for your country is telling you something.

Do not treat professional status as a key. ESMA's statement says distribution to non-retail clients still requires MiFID authorisation. Opting up to professional does not make an unauthorised venue an authorised one.

Do not route around a block. ESMA's statement notes that participating in circumvention of the measures is prohibited; the UK regulator says operating without a licence is an offence; the ANJ found Polymarket's earlier geoblock was being circumvented and responded with a block at the network level. What a venue does to an account it finds circumventing is in its own terms, and the venue guide linked above quotes them.

Separate reading from trading. Following prices and using public market data is not trading, but in France the ANJ treats the public display of an unauthorised site's odds for the purpose of promotion as an offence of its own. What you may do with a venue's prices covers the rest of that question.

If what you want is to be right rather than to be paid, the scored forecasting platforms in this catalogue, Metaculus and Good Judgment Open, settle in points rather than money, which is a different activity from the one both tests describe; their own terms still apply.

Watch the documents, not the headlines. The pieces that can move: the FCA's response to DP25/3, which would come as a consultation; any ESMA follow-up to the July 2026 statement; national gaming regulators' orders, each of which names its date.