The Federal Financial Supervisory Authority or BaFin, the German financial regulator, reminds companies wishing to issue electronic securities of its registration guidelines as provided for in the Electronic Securities Act which came into force in June 2021.
In a new brochure released by BaFin, the regulator said the license application deadline will end on June 10, 2022. BaFin also reiterated the application requirements for new enrollees and businesses wishing to upgrade their existing services to offering securities with blockchain technology. .
The process involves submitting a permit application which contains certain required details. One of these details is information about the company’s computer security systems. BaFin expects this to be well explained with a risk assessment attached.
The application must also contain the number and contact details of the directors and managers of the company who will be selected on the basis of their “reliability and technical aptitude”. In addition, the request must specify the measures to prevent money laundering and the financing of terrorism that the company has put in place.
A fee of 6,336 euros ($6,745) is also required and the application must be signed by authorized company personnel. Once these are provided, BaFin reserves the right to approve or reject the application and ask questions for further information.
The Electronic Securities Act was first introduced in 2020 before taking effect in 2021. In particular, the law allows the use of blockchain technology to issue securities in place of paper certificates.
Germany continues to expand the scope of digital currency regulations
The Electronic Securities Act is just one example of German laws that have fostered the adoption of blockchain technology and digital currencies. This year, the European country released national legislation on digital currency tax regulations that clarifies the taxation of assets.
The law allows capital gains tax exemption for digital currencies held or staked for more than one year. Prior to the tax law, the country also had a licensing regime in place for digital currency and blockchain companies.
He also encouraged more institutional investment in digital assets with the passing of a law that allows funds to allocate up to 20% of their portfolio to digital assets. These regulations made Germany the most digital currency-friendly jurisdiction in the first quarter of 2022, according to research by Coincub.
Watch: Presentation of the BSV Global Blockchain Convention, BSV On-chain Ecosystem Development in Europe
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