Belgium has taken a lead in regulating the transactions of the crypto market by imposing a new rule. As per The Financial Regulatory Agency of Belgium – FSMA (The Financial Services and Markets Authority), it will be mandatory for all – individuals or legal entities who want to offer trading facilities, custodial wallet facilities and other services in crypto market, to register themselves in advance. The rule is all set to be effective from May 1, 2022.
According to this rule, even the existing companies, exchanges will need to register themselves with FSMA before September 1, 2022. Hence the regulation is to be followed in order to start a new business or continue the existing one. They are also required to submit a detailed report of their activities, operations and business in Belgium before July 1, 2022.
The vending machines or the crypto ATMs which permit the exchange between cryptocurrency and fiat currencies, will also be subject to the new obligations.
Along with the implementation of new rule, FSMA has also listed some requirements, and a permanent compliance with these rules is must for all crypto businesses to keep their registration in active mode. These conditions include :
- To be constituted in the form of a company with a minimum capital amount of approximately $52,725 (EUR 50,000).
- To maintain professional integrity.
- To comply with the anti-money laundering legislation.
- To not use registration or provisional authorization with the FSMA to promote services to clients.
According to the information shared on the FSMA website, the registered players must inform the FSMA in advance of:
- any change in the shareholding of the company involving a change in the identity of the holders of holdings of at least 5% in the service provider, the amount of these holdings, or the identity of the persons who exercise control over the service provider.
- any proposal for the appointment of the persons responsible for the effective management, as well as the renewal or non-renewal of their appointment, upon their dismissal or resignation.
The FSMA plans to issue a unique registration number to all the companies after the completion of registration process.
This number will serve as the identity of company in Regulators Books. Just like we quote our PAN number in India for all income tax related functionalities, similarly the Crypto companies in Belgium will use the registration number in future.
This step by Belgium comes as an after thought of decision taken by a member of parliament, Christophe De Beukelaer, who became the first politician in Europe to convert his salary into Bitcoin (BTC).
It is important to note that the service providers governed by the law of a State outside the European Economic Area are not allowed to offer crypto related services in Belgium.
