French law paves the way for the digital assets services providers regulation
29 November 2019
The French Government has taken the initiative to create a cutting-edge legal framework in order to regulate the provision of digital assets services in France.
Over the last few years, digital assets did not appear to fall within scope of French law or regulation as they could not be characterised as currency, electronic money, financial instruments nor – on a more fundamental level – was there a clear sense of whether digital assets were merely data or some type of intangible property.
The French Parliament has taken the initiative to create a legal framework in order to regulate the provision of digital assets services. The French Parliament’s decision was notably driven by the desire to offer a more secure environment for digital assets in order to attract investors, as well as to implement mandatory changes to the French anti-money laundering regime by the 5th EU Anti-Money Laundering Directive (5MLD).
This legal structure was introduced in the law 2019-486 dated 22 May 2019 (the Pacte Law) which entered into force on 24 May 2019. This was supplemented by the decree 2019-1213 dated 21 November 2019 relating to digital assets services providers (DASP) and the decree 2019-1248 dated 28 November 2019.
The French DASP regime is now almost finalised; an order (arrêté) is due to be published shortly.
Pursuant to these legal provisions, any entity considering providing digital assets services in France is, as of 23 November 2019, required to file an application with the French Autorité des marchés financiers (the AMF) in order to become a DASP in particular if such provision of services entails solicitation activities. There is however a transition period of twelve months meaning that entities falling within the ambit of the mandatory DASP registration requirement have until end of November 2020 to register.