Regulation of the cryptocurrency market is constantly becoming stricter. Nowadays jurisdictions impose high regulatory and risk management requirements on virtual asset service providers.
Despite this, we always manage to find a solution that suits the client. All the time our team provides research of the market and regulations on various markets to find the best jurisdiction. Not so long ago we have made the global overview of the VASP regulation in EEA and ready to share information with our future and existing clients. Today we will look at the features of obtaining a cryptocurrency license in Sweden.
Tax Summary:
- Personal income tax – from 32.3 to 52.3%
- Corporate income tax – 20.6%
What law/s governs VASP activities?
- Act (2017:630) on measures against money laundering and financing of terrorism
- Act (2004:297) on banking and financing operations
- Act (1996:1006) on currency exchange and other financial activities
What activities are included in VASP services?
According to section 1 of the Act (1996:1006) on currency exchange and other financial activities, other financial activities are defined as professional activity consisting in the management of or trading in virtual currency.
Who is the VASP regulator?
- Finansinspektionen (FI)
- Sveriges Riksbank
What is the procedure for registering a VASP for a local company?
Companies intending to operate in the provision of virtual asset trading services are required to register with FI as a legal person who intends to engage in currency exchange to a significant extent or other financial activities according to the Act (1996:1006) on currency exchange and other financial activities.
Registration process include the following:
- Submission of an application to FI
- FI assesses if statutory requirements are met, such as:
- There is reason to believe the business will be conducted properly under anti-money laundering regulations.
- The suitability requirement in Section 3 for owners and management is met.
- The Authority must make a registration decision within 3 months of receiving a complete application (Chapter 2, Section 8).
- If statutory criteria are met, a registration shall be finished allowing the company to provide services related to trade in virtual currencies (Chapter 2, Sections 6 and 8).
Is there any specific authorization required for a VASP from another EU member state to provide services in this jurisdiction?
Act (1996:1006) on currency exchange and other financial activities does not provide exemptions for VASP from other EU member states.
What is the liability for the activities of a VASP from another EU member state without local registration/authorization in this jurisdiction?
Liability for companies, which provide services related to trade in virtual currencies without registration with FI according to Act (1996:1006) on currency exchange and other financial activities:
- Penalty fees up to 10% of turnover or €5 million for legal entities (Section 14).
- Orders to cease operations for serious/repeated/systematic violations (Sections 11-13).
- For natural persons in management roles:
- Penalty fees up to €5 million (Section 18).
- Prohibition from holding management positions at financial institutions for 3-10 years (Section 14).
Manimama Legal & Growth Agency provides a gateway for the companies operating as the virtual asset wallet and exchange providers allowing to enter to the markets legally. We are ready to offer an appropriate support in obtaining a license with lower founding and operating costs. We offer KYC/AML launch, support in risk assessment, legal services, legal opinions, advice on general data protection provisions, contracts and all necessary legal and business tools to start business of virtual asset service provider.
The content of this article is intended to provide a general guide to the subject matter, not to be considered as a legal consultation.
