Crypto License in Belgium
Starting any business is never an effortless feat and when it concerns cryptocurrencies, the situation is all the more overwhelming. These virtual currencies are occupying a space in the international market even though it is highly vulnerable to financial as well as regulatory risks. But still, stories of fortune and fame may direct anyone to start a business of cryptocurrencies in Belgium. And when this is the case, it’s important to learn about the mandatory regulations that are effective in this business operating in Belgium.
The Belgian Royal Decree on the status and supervision of businesses for exchanging virtual and fiat currency and custodian wallet providers has been implemented since May 1st, 2022. The Decree has clarified the process of registration for crypto brands that are willing to begin or already running in Belgium.
This registration is essential under the AML regulations and therefore, businesses are required to give a clear understanding of the prerequisites. Crypto businesses that are running their operations but have not registered will be facing serious penalties after September 1st, 2022.
The registration rule is applicable to all crypto businesses running and registered in Belgium. It includes:
- Exchange operations between fiat and virtual currencies
- Custodian wallet providing services
The Decree has further specified that any business offering such service as an additional basis will also have to register themselves. And it implies that the Decree also refers to the businesses registered by the Financial Services and Markets Authority as well as the National Bank of Belgium.
It has also obliged to extend the registration to the businesses running in the EEA and EU functioning in Belgium. This means that the operators of ATMs that offer virtual currency exchange services will also fall under the category.
Crypto License in Belgium
On July 20th, 2020, crypto businesses were categorized into the AML scope in Belgium. At this time, the AML Law of September 18th 2017 was also revised according to the European Fifth AML Directive. With this new amendment, crypto to fiat exchanges running in Belgium are in charge of:
- Implementation of internal AML policies
- Bringing risk assessment into effect
- Reporting transactions especially, that is suspicious
- Keeping records
- Conducting EDD or Enhanced Due Diligence and CDD or Customer Due Diligence
- Appointment of a compliance officer
The Financial Services and Markets Authority of Belgium is the primary supervising authority. As a result, the FSMA is entitled to supervise whether or not the crypto businesses of the state are complying with the AML policies. While the rules for registration were introduced in 2020, the implementation of the same following the Decree requirements has come into action in 2022.
How to Get Crypto License in Belgium?
The Financial Services and Markets Authority maintains two registers for exchanges and custodians, respectively. And it is up to the service provider whether they want to register for one or both. The fee for applying is EUR 8000 for each registration. The companies applying for both registrations shall have to pay a double fee. For registration with the FSMA, a business has to cater to the criteria set by the Belgian Royal Decree.
As the practice of obtaining licenses in Belgium shows, the minimum period for obtaining a license is about 4-5 months.
Legal Form and Requirements for the Minimum Share Capital
A crypto business operating in Belgium should have at least EUR 50000 capital and have the establishment registered as:
- a cooperative business, or
- a public limited company, or
- a European Company, or
- a European Cooperative Company.
One can check with the legal descriptions given in the Belgian Companies and Associations Code.
Belgian Crypto License and Executive Manager Requirements
Those crypto businesses looking for registration should have the required expertise along with professional integrity. Even though it is not clearly specified yet, there is mention of certain prohibited cases on the status and supervision of brokerage firms and credit organizations.
Any crypto business operating in Belgium has to give the information on stakeholders to FSMA. For this, they have to identify those individuals exercising control and those who have at least a 5 percent stake in the company with the precise amount mentioned. Those persons and stakeholders exercising control will need to possess certain qualities though it is not yet specified in detail by the FSMA.
All crypto businesses running in Belgium had to comply with the newly amended law issued on September 18th, 2017. It can be achieved through the implementation of an effective compliance program with an independent audit. The FSMA has also developed a checklist of information as well as documents that are required for a successful application.
It’s worth noting that any crypto business that continues providing services without mandatory registration could have to face imprisonment from a month to a year along with a monetary penalty EUR 50 to EUR 10, 000.
Our Belgian Lawyers will Help You to:
Analyze and adopt your business model according to Belgian legislation;
Form a company in a required legal form;
Develop internal compliance manual, policies and procedures;
Prepare your documents to apply for crypto license in Belgium;
To submit your application and interact with Belgian authorities;
Arrange a legal address for the company. If necessary, assistance in finding a separate office and hiring qualified personnel;