What has happened?

The French Minister for the Economy and Finance has announced that a legal framework on initial coin offerings has been adopted as part of the Action Plan for Business Growth and Transformation.

What does this mean?

In a tweet, Bruno Le Maire revealed that a parliamentary committee has adopted Article 26 of the PACTE bill (projet de loi relatif à la croissance et la transformation des entreprises), which is currently going through Parliament.

"In anticipation of European and international rules necessary because of the international nature of the subject", the bill defines what constitutes a "token" and states that the French financial markets regulator, the Autorité des marchés financiers (AMF), will give optional licences to issuers of "legitimate" projects, provided that certain rules and criteria are followed.

The text said:

"A token is an intangible property representing, in digital form, one or more rights that may be issued, registered, retained or transferred by means of a shared electronic registration mechanism that makes it possible to identify, directly or indirectly, the owner of the said property," the bill said in translation.

Issuers will be expected to provide a white paper to the AMF containing all the information on the issuer and the offer so that buyers can make informed decisions about the ICO.

The information in this document and any promotional material will also need to be correct, not misleading and make any risks clear.

The AMF may also require the issuer to be established or registered in France and have a 'know-your-customer' mechanism in place.

"Tokens with the characteristics of a financial security would nevertheless remain subject to the regime of the offer to the public of financial securities," the bill added.

Le Maire said that he hopes that "the legal framework will attract innovators from around the world".

Among other things, the PACTE bill aims to make it easy for companies to operate in France, and is a key element of President Emmanuel Macron's bid to turn France into a haven for business, including making it ready for the "blockchain revolution".

In this regard, earlier this year, France amended the tax regime of profits generated from cryptocurrency sales, reducing it from up to 45% to a flat 19%.

Next steps

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