European Commission Has ‘Serious Doubts’ About Markets in Crypto Assets Draft, Report Reveals – Regulation Bitcoin News

Some provisions of the recent crypto regulatory proposal, which was approved by the European Parliament, are not supported by the European Commission. Unofficial correspondence reveals that the Brussels executive is dissatisfied with some anti-money laundering provisions.

European Commission working on the Compromise proposal for EU Crypto Rules

Europe’s upcoming Markets in Crypto Assets (MiCA) legislation is facing challenges in the trilogue stage, less than two months after the European Parliament voted on the draft. Since then, discussions have been underway with the other two parties in the European Union’s legislative process — the Council of the EU and the European Commission (EC).

BTC Echo, a German cryptocurrency news website, has seen an informal letter that indicates that the Commission is not in agreement with the text approved by lawmakers. It also indicated that they are working to amend the documents. Concerns are expressed by the executive body about measures that combat money laundering or finance of terrorism.

With these provisions, found in Article 4 of MiCA, the Parliament wants to prevent the EU licensing of crypto asset service providers (CASPs) that are based in non-compliant jurisdictions or “high-risk areas,” or registered in countries that do not levy corporate tax. The Commission notes that there is no comparable ban in any other legal acts. What’s more, such a prohibition would violate the rules of the World Trade Organization.

According to the EC, it’s not clear why this measure should be applied specifically to crypto providers. Other EU directives are in place to combat money laundering and terrorist funding. The Commission maintains that these platforms offer adequate protection against operators who originate from countries outside the EU. This new regulation will only add to the EU’s burden.

A register of non-compliant CASPs would also be proposed by the European Parliament, which would be kept current by European Securities and Markets Authority. However, the Commission’s letter reveals it has “serious doubts” about the feasibility of this proposal. The Commission also feels that, if this is necessary at all it should be included in the anti-money laundering general regulations which affect all participants to financial markets.

Also, the European Commission criticizes non-compliance criteria adopted by it. It claims they are unclear. It’s demanding improvements from European Parliament in this regard and intends to put forward a compromise proposal before the next round of the trilogue talks scheduled for Wednesday, May 18.

Are you expecting European legislators take into consideration the EU Commission’s concerns regarding MiCA? Leave your comments below.

Lubomir Tatsev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.