French warning that may try to block cryptocurrency companies from operational in the country under licenses issued by other European Union member states-known as a passport-raises questions about the law enforcement of the 27-country Bloc Chief Chief Chief.
French security regulatorThe Autorité Des Marchés Financiers (AMF), is considered a ban on crypto companies operating in France under licenses obtained in other member states, Reuters reported Monday. The reported transition comes from AMF’s reminding that some crypto companies are looking for licenses in more EU constituents.
The warning will come less than one year after the EU Crypto-Assets regulation markets (MICA) occurred for crypto-asset service providers. MICA is designed to create a harmonious plot throughout Europe and prevent the type of arbitrage regulation that AMF has splanced.
While some legal experts see this as against MICA regulations, other observers in the industry believe this can be made at the expense of significant complexity.
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“MICA is designed to create a joint framework and give companies accessing a single regulated market throughout the EU. The promise is now under pressure,” according to Marina Marina Markezic, Executive Director of the European Crypto Initiative (EUCI). “From what we have seen, blocking a passport under MICA is technically possible, even with significant complexity.”
Recent position papers featuring “growing tensions of how MICA should be implemented, along with national authorities taking views on basic administration questions,” he added.
On Monday, France became the third country to call for the Paris -based European Securities and Markets Authority (ESMA) based on major crypto companies, next to Austria and Italy, according to a paper position that Reuters’ journalists saw.
Cointelegraph reached ESMA but did not receive a response by publishing.
Some of these proposals “require changes in the mica itself,” which “will reopen political negotiations and potentially bring fresh uncertainty to the industry,” Mar Markezic said.
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Crypto license blocking “Passport” contradicts Mica
Other legal experts see AMF’s threat as legal that cannot be done under the MICA regime. “Legal, the AMF cannot hinder a corresponding licensed creature from running in France,” according to Edwin Mata, lawyer and co-founder and CEO of Asset tokenization Platform brickken.
“AMF can monitor the behavior, raise administration concerns, and rising cases in ESMA, but it cannot impose unilateral barriers,” for companies licensed under any member state, Mata says, addition:
“Mica is a regulation, not a directive, which means it applies directly and equally to all member states.”
French security regulator messaging is more than a “warning” signing that France will “evaluate whether companies are trying to structure the products under MICA when it should in fact fall under MIFID II,” says Mata, who consults European markets with financial instruments Directive II (MIFID II) outlines for security markets.
The main challenge for regulators is to ensure that crypto companies do not use the “lighter regime” for financial instruments that should be classified as security, Mata added.
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