DISCLAIMER: The term “cryptolicense” in this text may also be used to mean digital asset service provider (DASP). The use of the term “cryptolicense” is intended solely to simplify the text for the customers and visitors of the website.
France stands out as a promising jurisdiction to get a cryptolicense for your business. As one of the leading European countries, a member of the G7 & G20, it is actively gaining momentum and holding its position as a global leader in innovation and technology.
The legal framework for French crypto regulation is the Law on Growth and Transformation of the Enterprise (PACTE), which regulates initial coin offerings (ICOs), digital assets and DASPs. Enacted on May 22, 2019, PACTE introduced specific regulation for DASPs and ICOs into the French Monetary and Financial Code (Codex). The French crypto regime has thus become one of the most demanding and comprehensive in the European Union and is already in line with future crypto asset market regulations.
The cryptocurrency regulator in France is the Financial Markets Authority (Autorité des marchés financiers / AMF) responsible for enforcing the DASP, ICO regimes and publishing recommendations and guidelines, and the Autorité de contrôle prudentiel et de résolution / ACPR, which is responsible for the prudential regulation of payment and e-money institutions.
As of May 2024, the AMF has registered 111 digital asset service providers and has licensed one - “Société Générale - Forge”.
French crypto regime is one of the most demanding in the EU
Key Numbers about Cryptolicense in France
minimum 1manager is required for a DASP |
30%capital gains tax (CGT) rate for individuals |
€50,000minimal share capital for DASPs |
25%corporate income tax (CIT) rate |
€23,500the average amount application fee for cryptolicense |
novalue added tax (VAT) for transactions with digital assets |
Legal Opinion about Cryptolicense in France
Ganna Voievodina
Manimama, CEO
"As CEO of Manimama OU, I am convinced that having a French cryptolicense is not only a smart decision, but also effective for your business. Despite the potential costs, France has positioned itself as a prime location for innovation, especially in the areas of blockchain and cryptocurrencies. A French license provides access to a dynamic ecosystem that fosters development and innovation."
Types of Activities with a License in France
Digital asset custody: the service of holding, on behalf of third parties, digital assets or access to them, where applicable in the form of private cryptographic keys, for the purpose of holding, storing and transferring digital assets.
Trading of digital assets against other digital assets: the ability to trade a variety of digital assets, providing diversified trading opportunities.
The reception and transmission of orders for digital assets: the act of receiving and transmitting buy or sell orders for digital assets on behalf of a client.
Advice to investors in digital assets: giving personalized recommendations to a third party, either at their request or on the initiative of the service provider providing the advice, concerning one or more digital assets.
The guaranteed placement of digital assets: searching for buyers on behalf of a digital asset issuer and guaranteeing them a minimum amount of purchases by undertaking to buy such assets not placed.
Buying or selling digital assets in a currency that is legal tender: providing conversion of assets into fiat currencies, giving customers the ability to transact in multiple currencies.
Operation of a trading platform for digital assets: the management of one or more digital asset trading platforms, within which multiple buying and selling interests expressed by third parties for digital assets in exchange for such other assets or a currency that is legal tender can interact in such a way as to result in the conclusion of contracts.
The management of digital asset portfolios: the act of managing, on a discretionary, client-by-client basis, portfolios that include one or more digital assets under a mandate given by a client.
Digital asset underwriting: the service of purchasing digital assets directly from the issuer, with a view to subsequently selling them.
The non-guaranteed placement of digital assets: the act of searching for buyers on behalf of a digital asset issuer without guaranteeing them an amount of purchases.
Benefits of Obtaining a Cryptolicense in France
Choose the Package of Services
Popular package
Premium
Full set up of DASP business with all the necessary infrastructure, connection to KYC providers and local substance
- Company formation in France
- Registration of the beneficial owner
- Registered address for 1 year
- Payment account for cryptorurrency operations
- Registering share capital
- Obtaining a cryptolicense
- Apostiled corporate documents
- Individual AML/KYC policies
- KYC/KYT provider integration
- Full support of the application during the assessment by the regulator
Advanced
Exhaustive set up of company infrastructure for the start of operational activity
- Company formation in France
- Registration of the beneficial owner
- Registered address for 1 year
- Registering share capital
- Obtaining a cryptolicense
- Apostiled corporate documents
- Individual AML/KYC policies
- Full support of the application during the assessment by the regulator
Basic
Obtaining DASP status under the minimum regulatory requirements
- Company formation in France
- Registration of the beneficial owner
- Registered address for 1 year
- Registering share capital
- Obtaining a cryptolicense
- Standart AML/KYC policies
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Step by Step Description
Step 1. Preparation stage
Preliminary project analysis and preparation of power of attorney for client attestation, consultations as for French law, gathering documents from the client to start the process of company incorporation and obtaining the licenseStep 2. Applying for initial approval
Preparing all necessary documents and submitting them to The Autorité des marchés financiers (AMF). The initial approval is conducted prior to the submission of the application in order to confirm the legal classification of the activities being carried out and the maturity of the projectStep 3. Applying for a cryptolicense
Creation of individual set of documents which mainly separated to information about the company, directors and shareholders, custody policy, program of operations and cybersecurity actionsStep 4. Obtaining the cryptolicense
Obtaining the DASP status and entering the company into the AMF register of cryptocurrency companiesUnderstanding the Requirements in France
Registration is necessary to become a DASP. Licensing is an optional extra and is not required
The French Monetary and Financial Code contains an extensive definition of digital assets that includes all possible virtual currencies. However, to date, there is no differentiation there.
In order to obtain DASP status it is necessary to:
- undergo mandatory registration (if it concerns services such as: storing and/or buying or selling digital assets in a currency that is legal tender, and/or trading digital assets with other such assets and/or operating a trading platform for digital assets), and for the first two services also AML/CTF verification, and
- obtain an additional (optional) license
The fees in case of compulsory registration are €1,000 and in case of an additional license €2,000.
The obligatory registration takes place with the AMF and applies to a service provider that is registered both in France and outside France. It checks the reputation and competence of the organization's managers and beneficial owners and requests ACPR authorization.
The optional license can be obtained by someone who provides one or more digital asset services and is registered in France. AMF verifies compliance in terms of organization, financial resources and business conduct.
The following forms must be completed to apply in both cases:
- Application Form
- Executive Manager Form
- Significant Shareholders Form (more than 25% for registration and more than 10% for license)
- Programme of operations
- Cybersecurity Self-Assessment Questionnaire
The procedure for obtaining DASP status consists of the following steps:
1. Negotiations with AMF and ACPR - conducted before the application is submitted to confirm the legal classification of the activity and the maturity of the project (is an optional step for an additional license).
2. Submission of the application - must contain a detailed description of the services for which the license will be issued. It should be submitted in English or French.
3. Reviewing the application and continuing negotiations with AMF and ACPR - supervisors from these 2 bodies are appointed to review the application for registration. They organize one or more meetings/conferences to present the project and the AML/CTF system by the applicant. In case of licensing - this is only done with AMF participation.
4. Training - if necessary, the applicant may be asked to undergo training related to AML/CTF.
Requirements for Obtaining a French Cryptolicense
Depending on the type of service, the minimum capital amount varies from €50,000 to €150,000
Registered persons shall comply with the provisions below:
- the integrity and competence of the managers
- honesty, competence and reasonable and diligent management by those with supervisory authority
- application of AML measures
Licensed persons shall mandatorily comply with such conditions as:
1. Rules regarding financial resources and organization:
- either have professional liability insurance or a minimum amount of own funds
- have at least one executive manager
- possess sufficient human and technical resources
- have reliable IT systems
- Implement an internal control system
- have a claims handling procedure
- have a structure to avoid conflicts of interest
- establish procedures to prevent ML and TF
2. Rules of business conduct:
- provide clear information to clients
- sign a contract with the client
- comply with specific requirements for the services provided
The minimum capital required for a digital asset service provider is:
Taxes in France
The French tax system is characterized by the absence of VAT on transactions with cryptocurrencies
The Directorate General of Public Finance (DGFiP) in France has explained that cryptocurrency is treated as a movable asset and that any capital gains from the sale of a movable asset are subject to taxation.
As of January 1, 2019, the tax regime applies specifically to capital gains from digital assets sold by individuals. It applies only to capital gains realized as part of an individual's private asset management. When the purchase and sale of digital assets is carried out on a professional basis, the gains are subject to a progressive income tax rate in the industrial and commercial gains category. For individuals, annual total capital gains from the sale of such assets are taxed at a flat rate of 30%.
The standard corporate tax rate is 25%. Companies that are tax residents are liable to tax on income generated in France, while income derived from foreign activities is usually excluded from the taxable base.
Regarding value added tax, the purchase or sale of digital assets used as means of payment has been exempted from VAT following the famous Hedqvist judgment handed down in 2015 by the Court of Justice of the EU. According to the general ruling published by the French tax administration, this exemption was explicitly extended to all digital assets and to transactions between them.
It is worth noting that France is very liberal in terms of what is considered a taxable transaction. The DGFiP considers the conversion of cryptocurrency into cash as a disposal of cryptocurrency - so there is no need to pay tax on cryptocurrency-to-cryptocurrency transactions. Tax-free transactions include:
- buying a cryptocurrency with a euro or other fiat currency unit
- exchanging one cryptocurrency for another - including exchanging stablecoins, NFTs and tokens for cryptocurrency and vice versa
- transfer of cryptocurrency from one wallet to another
- cryptocurrency storage
It should also be mentioned that capital gains from the disposal of cryptocurrency (selling it for fiat currency) up to 305 € per year are not taxable.
Frequently Asked Questions
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Is cryptocurrency activity legal in France?Yes, cryptocurrency activities are legal here. In order to provide services in the field of digital assets, a company must obtain a French crypto license. There are two levels: DASP registration and obtaining an additional license that complies with the future European MiCA regulation.
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Who are the regulators in the French cryptosphere?The main bodies responsible for regulating the crypto industry are the Financial Markets Authority (Autorité des marchés financiers) responsible for the crypto regime, and the Prudential Control and Regulation Authority (Autorité de contrôle prudentiel et de résolution), which is responsible for the prudential regulation of payment and e-money institutions.
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What is a digital asset under French law?A digital asset is any digital representation of value that is not issued or guaranteed by a central bank or public authority, that is not necessarily linked to a legal tender and does not have the legal status of money, but that is accepted by natural or legal persons as a means of exchange and that can be transferred, stored or exchanged electronically.
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In which cases is registration with the AMF mandatory?There is mandatory registration for four types of services such as: storage; buying or selling digital assets in a currency that is legal tender; trading them against other digital assets; and operating a trading platform for digital assets. This obligation applies to service providers established in France as well as outside France.
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Can I submit my cryptolicense application electronically?Yes, the application and its components must be sent by e-mail to the AMF at the following address: psan@amf-france.org.
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Where can I find the list of persons who hold a French cryptolicense?The list of such persons is publicly available on the AMF website.
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Are there capital requirements for DASPs?Yes, depending on the type of services provided, this amount can be between €50,000 and €150,000.
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What do I need to do to keep my cryptolicense?In order to maintain your cryptolicense, you need to regularly update all necessary documents, comply with regulatory requirements, and ensure compliance with security and transparency standards in the conduct of your business.
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Under what circumstances can AMF revoke a cryptolicense?AMF can revoke it after a positive opinion of the ACPR on the following grounds: for non-compliance with the requirements; withdrawal for not conducting business; on the initiative of the DASP if it ceases to operate.
Client Feedbacks
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“I value Manimama OU as legal advisors for their thorough understanding of cryptoregulation and excellent quality of legal services.”
“Our success in obtaining licenses was made possible largely thanks to Manimama OU.”
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