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What will change for utility token issuers?


The PACTE draft bill aims to introduce into French law the possibility for utility token issuers to obtain a visa for their tokens’ issuance.

For the purpose of this reform, utility tokens shall be understood as digital goods giving rise to one or more rights and which may be issued, registered, stored or transferred via distributed ledger technology[1]. The tokens, which qualify as financial instruments pursuant to MiFID II, are excluded from the scope of this regime.

This visa would be delivered by the French public authority supervising financial markets (the Autorité des marchés financiers, or AMF), if the offer and its issuer comply with a number of requirements, including the following:

  • The issuer must provide token subscribers with a document containing all information relevant for the public and regarding the offer and the issuer. Such information, together with the information in the relevant marketing documents, shall be clear, fair and not misleading.
  • The issuer must be a legal person incorporated or established in France.
  • The issuer must put in place the appropriate means to monitor and safeguard the funds raised following the tokens’ issuance.
  • The issuer must comply with the obligations provided under French law on preventing the use of the financial system for the purposes of money laundering or terrorist financing (AML/CTF).

The General Regulation of the AMF will specify how these requirements must be implemented. These specifications should be finalised by the end of the first semester 2019, with the first visas potentially delivered by the AMF in September 2019.

Obtaining such a visa will be optional: issuers may decide whether they seek the visa from the AMF. There will be no regulatory obligation compelling the issuer to do so. However, if an issuer does decide to obtain a visa, the requirements conditioning such visa become binding. The AMF would hence be granted the power to monitor and supervise compliance by said issuer with said obligations.

With this reform, the visa is intended as an incentive to facilitate issuers’ approach of potential subscribers and other stakeholders. The legal framework is meant as a marketing tool for innovative players. The same approach is also used for service providers.


Please click HERE to read the full article about How Law Can cope with innovation ?, authored by Matthieu Lucchesi and Jennifer D’Hoir, members of Gide 255


[1] The PACTE draft bill refers to « tout bien incorporel représentant, sous forme numérique, un ou plusieurs droits pouvant être émis, inscrits, conservés ou transférés au moyen d’un dispositif d’enregistrement électronique partagé permettant d’identifier, directement ou indirectement, le propriétaire dudit bien. » – see Article 26 of the draft bill.