The Malta Financial Services Authority (“MFSA”) has today issued a consultation document entitled “Consultation with the Financial Services Industry with regards to the Virtual Financial Assets Regulations to be issued under the Virtual Financial Assets Act”.
Following the publication of a set of three draft bills that will constitute Malta’s legal and regulatory framework surrounding blockchain technology, including the bill to introduce the Virtual Financial Assets Act (the “VFAA”), the MFSA has now proceeded to announce a set of draft regulations to supplement the provisions of the VFAA (the “VFA Regulations”). The VFA Regulations are intended to supplement the high-level principles set out under the VFAA, insofar as the following matters are concerned:
- Exemptions: persons to be exempted from the licensing requirements which are relative to VFA services (such as those persons already licensed to provide certain investment services under the Investment Services Act, Chapter 370 of the laws of Malta, and securitisation special purpose entities), together with an alternative option of mere notification in other instances, underlining the VFAA’s high-level principle of avoiding regulatory duplication;
- Licence Classifications and Fees: introducing four classes of licences for providers of VFA services, which classification will determine the corresponding requirements of licence holders and the relevant application and supervisory fees. The draft VFA Regulations also provide for the registration and supervisory fees for VFA Agents;
- Control of Assets: designed as an investor protection mechanism to the effect that licence holders under the VFAA, or acting under an exemption thereunder, will be subject to additional requirements when holding and/or controlling client’s monies and / or assets. Furthermore, the VFA Regulations clarify the legal position with respect to asset patrimony; and
- Administrative Penalties and Appeals: with respect to persons failing to comply with the VFA Regulations.
The MFSA’s consultation is open to the public from 4th July 2018 until the 20th July 2018. Camilleri Preziosi’s Blockchain Taskforce will be evaluating the proposed VFA Regulations and presenting its views thereon. Interested parties who require any further information on these latest developments are kindly invited to contact us on blockchain@camilleripreziosi.com.
The full consultation document can be accessed here: https://www.mfsa.com.mt/pages/readfile.aspx?f=/files/Announcements/Consultation/2018/20180703_LNConsultationDocFinal.pdf
