FAI Comply
IFX EXPO International 2023 – Opening Keynote speech by CySEC Chairman – Dr George Theocharides
To commence the 2023 IFX Expo 2023, the Cyprus Securities and Exchange Commission Chairman, Dr George Theocharides, gave an opening
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VASP Regulation in Lithuania
The amendments to the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania, brought into scope the Virtual Currency Exchange Operators and Depository Virtual Currency Wallet Operators. Accordingly, the Financial Crime Investigation Service (FCIS) updated its definition of obliged entities under the Law which came into force on 1 November 2022, in regards to the registration and operating conditions for providers of services related to crypto assets.
Additionally, it is expected that the Markets in Crypto-Assets (MiCA) regulation will come into force in 2024 across all EU member states, which aims to deliver uniform requirements concerning the authorisation and governance of VASPs. MiCA will enable VASPs to passport their services across the EU while simultaneously preventing regulatory fragmentation. In line with the Markets in Financial Instruments Directive (MiFID), MiCA’s provisions reference safeguarding measures for client’s crypto-assets, complaints, conflicts of interest handling procedures, outsourcing, et cetera.
In accordance with MiCA, VASPs will be subject to strong organisational requirements, particularly in ensuring that management and shareholders with over 20% ownership or voting rights are fit and proper, staff are adequately skilled and have the sufficient expertise, as well as that there are sound internal controls in place and risk assessment mechanisms to ensure the integrity and confidentiality of all information.
TYPES OF VASP AUTHORISATION
Types of Virtual Asset Service Provider (VASP) authorisation
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Crypto currency exchange operator is the company or the affiliate of other company exchanging cryptocurrency owned by the client for the commission fee.
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Crypto currency depository wallet operator is the company or the affiliate of other company managing client’s cryptocurrency depository wallets.
Authorisation also allows for the issuing of virtual assets (tokens) in the primary market.
MANDATORY REQUIREMENTS
Though the activity of Virtual Currency Exchange Operators and (or) Depository Virtual Currency Wallet Operators is not currently licenced in Lithuania, there are mandatory requirements foreseen in the Law
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The Operator must be an incorporated legal entity (Company) in Lithuania.
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The entity must have a senior manager who is a permanent resident in Lithuania pertaining to Personal Income Tax.
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The Management Body and Ultimate Beneficial Owners of the entity must meet the requirements of good repute.
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Capital Requirement of 125,000 EUR..
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The entity must hold a guarantee or guarantee document issued by an insurance undertaking for at least 100,000 EUR per customer claim for indemnity and 500,000 EUR for all customers’ claims for indemnity.
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The entity must have a designated anti-money laundering compliance officer or a designated member of the board who can organise the implementation of the relevant AML law. The FCIS must be notified in writing of the designation.
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The managing staff of the VASP must not represent more than one VASP at a time except where the VASPs belong to a single group or undertaking.
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The VASP must have established and sufficient internal policies and control procedures in place (for instance risk assessment, AML training, etc).
WHAT CAN FAI DO
What Can FAI Comply do for Your Business?
Consulting on services, and design of the VASP structure
Overall coordination of services and management of the process to completion
Assistance with the completion and submission of forms to the FCIS
Follow-up and communication with the FCIS on you behalf
Assistance with recruitment and appointment of Staff (extra service fee may be required)
Creation of the necessary documents, policies and procedures in accordance with the FCIS requirements (such as the Internal Operations Manual, AML Manuals and Risk Assessments in line with the law)
Review and collect all the necessary documentation from the Company to ensure compliance with the relevant regulations
Assistance with recruitment and appointment of staff (extra service fee may be required)
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