The MiCA Act aims to provide legal certainty for encrypted assets not covered by existing EU financial services legislation, and to establish uniform rules for encrypted asset service providers and issuers at EU level. The MiCA bill would replace the existing national framework that applies to crypto assets not covered by existing EU financial services legislation, and create specific rules for so-called "stablecoins", including when they are electronic money. The MiCA Act is divided into nine titles.
1#
Part I sets out the subject matter, scope and definitions.
Article 1 stipulates that the regulation applies to encrypted asset service providers and issuers, and establishes uniform requirements for the transparency and disclosure of the issuance, operation, organization, and governance of encrypted asset service providers, as well as consumer protection rules and regulations. Measures to prevent market abuse.
Article 2 limits the scope of the regulation to cryptoassets that are financial instruments, deposits or structured deposits that do not qualify under EU financial services legislation.
Article 3 stipulates the terms and definitions used in this regulation. It is important that the Commission can pass authorization acts to clarify some technical elements in the definition to adapt to market and technological developments.
2#
Title II regulates the issuance and marketing to the public of encrypted assets other than asset reference tokens and electronic currency tokens.
It states that if the issuer complies with the requirements of Article 4, such as the obligation to be incorporated as a legal person or to draft a crypto-asset white paper pursuant to Article 5 (together with Annex I), and to notify the competent authority of such a crypto-asset white paper (Article 7 Article 8) and publication (Article 8), the right to offer such encrypted assets to the EU public or seek to trade them on trading platforms.
Once the white paper is published, issuers of crypto-assets can offer their crypto-assets in the EU, or seek to allow such crypto-assets to be traded on trading platforms (Article 10).
Article 4 also includes some exemptions from the publication of white papers, including small offerings of crypto-assets (less than EUR 1 million within 12 months) and for offerings as defined in the Prospectus Regulation (EU Regulation 2017/1129) Issuance by Accredited Investors.
Article 5 and Annex I set out the information requirements regarding the white paper of a crypto-asset that accompanies a public offering of a crypto-asset or the acceptance of a crypto-asset to a crypto-asset trading platform, while Article 6 sets out some requirements related to the publication of a crypto-asset issuer. Requirements pertaining to marketing materials, other than asset reference tokens or e-money tokens.
Cryptoasset white papers will not require a pre-approval process by national authorities (Article 7). It will be notified to the national competent authority and assess whether the crypto asset involved constitutes a financial instrument under the Markets in Financial Instruments Directive (Directive 2014/65/EU), in particular, after notifying the crypto asset white paper, the competent authority will The right to suspend or prohibit issuance, to require further information to be included in the white paper of a crypto asset, or to disclose the fact that the issuer has not complied with the regulations (Article 7).
Title II also includes time-limited cryptoasset issuances (Article 9), amendments to the initial cryptoasset white paper (Article 11), revocation rights granted to cryptoasset acquirers (Article 12), Specific terms of the obligations imposed by the issuer (Article 13) and the responsibilities of the issuer (Article 14) attached to the white paper of the encrypted asset.
3#
Chapter 1 of Title III presents the authorization procedure for issuers of asset reference tokens and the approval procedure for the white paper on their cryptoassets by national authorities (articles 16 to 19 and annexes I and II).
In order to be permitted to operate within the EU, issuers of asset-referenced tokens should be established as legal entities established within the EU (Article 15).
Article 15 also states that if the issuer is not authorized in the EU and has not published a crypto asset white paper approved by its competent authority, it shall not provide asset reference tokens to the public in the EU or allow trading on crypto asset trading platforms.
Article 15 also includes exemptions for asset-referenced tokens on a small scale and asset-referenced tokens sold, distributed and exclusively held by accredited investors. Article 20 details the revocation of authorization, and Article 21 sets out the procedure for amending the white paper of a crypto asset.
Chapter Two sets out the obligations of asset reference token issuers.
It states that they should act honestly, impartially and professionally (Article 23).
It sets out the rules for publishing white papers and potential marketing communications of crypto assets (Article 24) and the requirements for these communications (Article 25).
In addition, issuers must meet ongoing information obligations (Article 26) and they must establish a complaints handling procedure (Article 27). They are also subject to other requirements such as rules on conflicts of interest (Article 28), notifying their authorities of changes in their governing body (Article 29), governance arrangements (Article 30), own funding (Article 31 ), asset reserve rules supporting asset reference tokens (Article 32), and custody requirements for reserve assets (Article 33).
Article 34 explains that issuers can only invest reserve assets in safe, low-risk assets. Article 35 also requires issuers of asset reference tokens to disclose the rights attached to asset reference tokens, including any direct claims against the issuer or the asset reserve. Article 35 provides for holders of asset-reference tokens with minimum limited rights.
Article 36 prevents issuers of asset reference tokens and crypto asset service providers from granting any interest to holders of asset reference tokens.
Article 42 of Chapter III states that the issuer is obliged to establish a procedure for the orderly conclusion of its activities.
Chapter IV sets out the rules for the acquisition of issuers of asset-referenced tokens, of which Article 37 specifies in detail the assessment of an intended acquisition and Article 38 specifies the content of such an assessment.
Article 39 of Chapter V sets out the criteria that INSEAD shall apply when determining whether an Asset Reference Token is material. These criteria are: the size of the client base of the originator of the asset-reference token, the value of the asset-reference token or its market capitalization, the number and value of transactions, the size of the asset reserve, the importance of the issuer’s cross-border activities, and the relationship with the financial system. interconnectedness.
Article 39 also empowers the Commission to adopt an enabling act to further clarify under which circumstances and which thresholds issuers of asset-reference tokens are deemed material and above which thresholds are exceeded. Article 39 includes some minimum thresholds, which the enabling act is to comply with in all cases.
Article 40 details the possibility for issuers of asset reference tokens to actively list them as significant when applying for authorization. Article 41 sets out additional obligations applicable to issuers of significant asset reference tokens, such as additional own funding requirements, liquidity management policies and interoperability.
4#
Chapter 1 of Part Four describes the authorization procedure for issuers of electronic currency tokens.
Article 43 states that unless the issuer is authorized as a credit institution or an "electronic money institution" within the meaning of Article 2(1) of Directive 2009/110/EC, electronic money tokens shall not be made available to the EU public Encrypted asset trading platform for transactions. Article 43 also provides that "electronic money tokens" are considered electronic money for the purposes of Directive 2009/110/EC.
Article 44 describes how e-money token holders shall be provided with claims against the issuer: e-money tokens shall be issued at par and upon receipt of funds, and at the request of e-money token holders, issued One must redeem at face value at any time.
Article 45 prevents issuers of e-money tokens and crypto asset service providers from granting any interest to holders of e-money tokens.
Article 46 and Annex III set out the requirements for the crypto asset white paper accompanying the issuance of electronic currency tokens. For example: a description of the issuer, a detailed description of the issuer's project, whether it involves selling electricity to the public
Sub-currency tokens or allowing these tokens to enter the trading platform, and risk information related to the e-money issuer, e-money tokens and any potential project implementation.
Article 47 includes the liability provisions attached to the white paper on such cryptoassets in relation to electronic currency tokens.
Article 48 sets out the requirements for potential marketing communications in connection with electronic currency token offerings.
Article 49 states that any funds received by the issuer in exchange for electronic currency tokens shall be invested in the same assets as the currency to which the electronic currency tokens correspond.
Article 50 of Chapter II states that the EBA shall classify electronic money tokens as important tokens in accordance with the criteria set out in Article 39.
Article 51 details the possibility for issuers of e-money tokens to list them as important when actively applying for authorization.
Article 52 contains additional obligations applicable to issuers of significant e-money tokens. Issuers of significant electronic currency tokens must apply Article 33 on the custody of reserve assets and Article 34 on investments in these assets, rather than Article 7 of Directive 2009/110/EC on remuneration, interoperability and Article 41 paragraphs 1, 2, 3 of liquidity management, Article 41 paragraph 4, instead of Article 5 of Directive 2009/110/EC, and Article 42 on the orderly conclusion of its activities.
5#
Title V sets out the provisions regarding the authorization and operating conditions of crypto asset service providers.
Chapter I defines the provisions governing authorization (Article 53), specifies the content of such an application (Article 54), the evaluation of the application (Article 55) and grants the competent authority the right to revoke the authorization (Article 56 ).
The chapter also includes the mandate for ESMA (European Securities and Markets Authority) to establish a register of all crypto asset service providers (Article 57), which will also include information from the crypto asset white paper notified by the competent authority.
For cross-border provision of encrypted asset services, Article 58 stipulates that details and information on cross-border activities of encrypted assets should be communicated from the competent authority of the home country to the competent authority of the host member state.
Chapter II imposes requirements on all cryptoasset service providers, such as the duty to act honestly, impartially and professionally (Article 59), prudential safeguards (Article 60 and Annex IV), organizational requirements (Article 61),
Rules for the safekeeping of clients’ crypto assets and funds (Article 63), the obligation to establish complaints handling procedures (Article 64), rules on conflicts of interest (Article 65) and rules on outsourcing (Article 66).
Chapter III specifies the requirements for specific services: custody of encrypted assets (Article 67), trading platform for encrypted assets (Article 68), exchange of encrypted assets for legal tender or other encrypted assets (Article 69), execution of orders (Article 69) 70), cryptoasset allocation (Article 71), receipt and transmission of orders on behalf of third parties (Article 72) and consultation on cryptoassets (Article 73).
Chapter IV sets out the rules regarding the acquisition of crypto asset service providers.
6#
The sixth title
Article 76 defines the scope of market abuse rules.
Article 77 defines the concept of inside information and states that issuers whose crypto assets are permitted to trade on crypto asset trading platforms should disclose inside information. Other provisions of this Part prohibit insider trading (Article 78), unlawful disclosure of inside information (Article 79) and market manipulation (Article 80).
7#
Title VII details the powers of national authorities, the European Business Council and the European Securities Authority.
Chapter I obliges Member States to designate a competent authority or authorities for the purposes of this Regulation, including the designation of a competent authority as a single point of contact (Article 81). Chapter I also details the powers of national authorities (Article 82), cooperation between authorities (Article 83), cooperation with European banks and the European Securities Authority (Article 84) or Article) cooperation. It also details the notification obligations of the Member States (Article 86), the rules on professional secrecy (Article 87), data protection (Article 88) and the precautions that can be taken by the competent national authorities of the host Member State (Article 89 strip). Article 90 sets out the rules for cooperation with third countries, and Article 91 regulates the handling of complaints by the competent authorities.
Chapter II details the administrative penalties and measures that the competent authority can impose (Article 92), exercise its supervisory and punitive powers (Article 93), the right to appeal (Article 94), publish decisions (Article 95), Reporting of penalties to INSEAD and the European stock exchanges (Article 96), as well as reporting violations and protection of those who report such violations (Article 97).
Chapter III details INSEAD’s powers and competences related to the supervision of issuers of major asset reference tokens and major e-money tokens, including supervisory responsibilities (Article 98).
Article 99 refers to the rules regarding the supervisory mission of issuers of significant asset reference tokens. The academy should include, inter alia, the competent authorities of the home country of the issuer of the asset reference token, the European Banking Authority, the European Securities Authority, responsible for supervising the most relevant crypto-asset trading platforms, custodians, credit institutions, etc. Competent authorities for services related to significant asset reference tokens and the European Central Bank. If the issuer of a significant asset reference token is established in a member state whose currency is not the euro, or includes a non-euro currency in its reserve assets, then the national central bank of that member state is part of the academy. Competent authorities not affiliated with the Academy may request from the Academy all information relevant to the discharge of their supervisory duties.
Article 99 also describes how the EBA (European Banking Authority, European Banking Authority), in cooperation with ESMA and the European Central Banking System, must develop draft supervisory standards to determine the most relevant trading platforms and custodians, as well as details of the practical arrangements for the academy.
Article 100 gives the Academy the power to issue non-binding opinions. These opinions may involve requiring issuers to hold more of their own funds, revising the white paper of encrypted assets, envisaging withdrawal of authorization, envisaging agreements for exchanging information with third-country regulators, etc. The competent authorities or INSEAD shall give due weight to the views of the Faculty, and if they disagree with the views, including any recommendations, their final decision shall include an explanation of any material deviations from the views or recommendations.
Article 101 lays down rules for regulators of issuers of significant electronic currency tokens, which function in the same way as regulators of asset reference tokens (additional participants include most competent authority of the relevant payment institution), Article 102 sets out the power of such supervisory authority to issue non-binding opinions.
Chapter Four stipulates the powers and authority of the European Business Administration Commission to issuers of major asset reference tokens and issuers of major electronic currency tokens. Legal privilege (article 103), request for information (article 104), general investigative powers (article 105), on-site inspection (article 106), information exchange (article 107), agreements to exchange information with third countries ( 108), disclosure of information from third countries (Article 109) and cooperation with other authorities (Article 110).
Article 111 refers to the obligation of professional secrecy, and Article 112 refers to the supervisory measures of the European Business Council. Administrative penalties and other measures, in particular fines, are detailed in Article 113, followed by provisions governing the periodic payment of fines (Article 114), the disclosure, nature and enforcement of fines (Article 115), and the adoption of supervisory measures and the corresponding procedural rules for the imposition of fines (Article 116).
Articles 117 and 118 establish, respectively, the hearing requirement for persons concerned and the court's unlimited jurisdiction over INSEAD's decision.
According to Article 119, the EBA should be able to collect fees from issuers of important asset reference tokens and issuers of important electronic money tokens under the enabling act adopted under the Regulations.
Article 120 empowers the European Banking Authority to delegate specific supervisory tasks to the competent authorities, if necessary for the proper supervision of issuers of important asset reference tokens or issuers of important electronic money tokens.
8#
Title VIII deals with the exercise of authority to pass commissioned acts by the Commission. The proposals for the Regulations consist of empowering the Commission to adopt enabling acts specifying certain details, requirements and arrangements set out in the Regulations (section 121).
9#
Title IX contains transitional and final provisions, including an obligation for the Commission to prepare a report assessing the effects of the Regulation (section 122).
Transitional measures include non-retroactive provisions for cryptoassets issued prior to the entry into force of this regulation, with the exception of asset reference tokens and e-money tokens, listed in Article 123.
Article 124 amends the Directive on the protection of persons who report breaches of EU law by adding this regulation.
Article 125 stipulates that this amendment must be transposed into national law 12 months after the regulation enters into force.
Article 126 states that the Regulation shall apply 18 months after its entry into force, except that provisions relating to electronic money tokens and asset reference tokens shall apply from the date of entry into force of the Regulation.
