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Important changes in Estonian crypto licensing legislation

Important changes in Estonian crypto licensing legislation

After several attempts, the Estonian Parliament has adopted and the President has signed amendments to the Money Laundering and Terrorist Financing Prevention Act and the State Fees Act.

What do the adopted amendments mean for cryptocurrency activities regulation in Estonia?

Significant changes relate to the conversion of two crypto licenses into one, the mandatory existence of an account and paid-up share capital, the presence of real activities in Estonia and innovations in AML / KYC regulation.

The essence of the new cryptocurrency license

There will be one license of a “Digital Asset Service Providers” instead of two licenses for providers of a service of exchanging virtual currencies against fiat money and for providers of virtual currency wallets after the changes take effect. The new Estonian crypto license will regulate the provisions similar to the two previous licenses, as well as the service of exchanging some digital assets ​​for others. In this case, you should inform the regulator about the selected type(s) of activities.

Licensed company account requirements

A company with crypto license must have an account in a bank or a payment system located in the European Economic Area and entitled to provide cross-border services in Estonia.

New requirements for the authorized capital of an Estonian crypto company

Changes in legislation have seriously affected an authorized capital. They prescribe that the company should have a minimum paid-up authorized capital of 12,000 euros (it was enough previously to have 2,500 euros unpaid capital).

Substance of the Digital Asset Service Providers in Estonia

According to the amended Acts, the place of registration, the location of the board and the place of business of the company must be in Estonia. In this case, the official criteria for determining the location of the board and the business are not specified. In this connection, it should be guided by generally accepted standards.

Requirements for the AML / KYC policy of Estonian cryptocurrency companies

Relevant company policies should include rules on compliance with international sanctions application, as well as a procedure for monitoring their implementation. In addition, each licensed company must have a person responsible for international sanctions application.

Changes to the Digital Asset Service Providers License obtaining

In addition to the above changes, new companies will be affected by an increase in the state application fee from 345 euros to 3300 euros, as well as an increase in the term of consideration from 30 to 60 days.

Period of entry into force of the new amendments to cryptocurrency legislation

Companies that have received the license(s) before 03.10.2020 must bring their activities in line with the amendments to the Act that entered into force before 01.07.2020. Companies that will receive the license after 10.03.2020 must comply with the amended Acts at the time of application.

These changes are significant, but do not worry about them. Mayon Solutions team is always ready to help you. We will assist both with the adaptation of an existing company and with the registration of a new one according to the new requirements.

Our long-term experience in the field of registration of international companies, opening of bank and merchant accounts, as well as licensing, will help to choose the optimal solution especially for you.

 

You will succeed with Mayon Solutions!

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