Robert Ophele, President of the Autorité des Marchés Financiers (AMF), has highlighted several challenges for the regulator. The watchdog expresses concern about the effectiveness of the existing legal framework in determining where ICOs fall in terms of regulation.
The rise of the ICOs appears to be worrying the AMF. After analysing several cases, the French regulator expresses the opinion that the sale of tokens via ICO does not fall under any existing legal category.
For EU authorities, the difficulties involved in tackling the blockchain challenge, i.e. bureaucratising the process, are just beginning. If the technology industry is any guide, Eurocrats generally have a hard time dealing with online companies.
After years of deliberations, last month European authorities finally decided to pressure tech giants like Apple, Amazon, Facebook and Google over additional taxes. For years, these companies have been using a variety of legal tax loopholes to pay their EU-wide taxes in Ireland at a much-reduced rate.
Blockchain: a Call on All Monetary and Financial Authorities
Unsurprisingly, the French regulator is focusing on the blockchain and urges legal authorities in the EU to take adequate steps to determine what the nature of the transactions are, in order that it can apply the necessary legal framework to the field.
The AMF urges action on the part of authorities as institutional investors come into the fray. According to Ophele, European authorities need to act swiftly to respond to the financial innovations that blockchain technology brings.
The AMF says that it is frequently asked by new projects that are aiming to raise funds via ICO on whether there is a legal framework that applies to them.
“ICOs do not belong to public offerings of financial securities, participatory financing or intermediation (all of which require the distribution of an appropriate prospectus),” explains Robert Ophele.