The French financial markets regulator, the Autorité des Marchés Financiers (AMF), has made its first initial coin offering (ICO) approval.
While token sales remain legal as a fundraising option in France, only those that have been approved by the AMF may be marketed directly to the public.
The AMF announced on Wednesday that it has approved the first public initial coin offering in the country. French Law No. 2019-486 of 22 May 2019, also referred to as the Action Plan for Business Growth and Transformation (Pacte) law, has introduced a specific regime for crypto assets and ICOs in France.
French ICO Set to Roll Out
Adopted on April 11, the law gives issuers the option to obtain approval for their token sales from the AMF. The issuer whose ICO has been approved is a company called French-ICO. According to its website, the token’s public offering is scheduled to begin on March 1 and end on June 1. The regulator detailed:
The AMF approval will be valid until the end of the subscription period scheduled for June 1, 2020. With France among the European Union countries trying to create its own digital currency, it seems fit to approve ICOs and other cryptocurrency/blockchain deals that will attract investors ans more stakeholders.
The AMF emphasized that it issues approval to ICOs, not their issuers. “The information document approved by the AMF concerns only one ICO over a period that may not exceed six months and is valid only for the period of the offering described in the information document,” the French financial regulator clarified.
Approving ICOs May be a Good Thing for France
On its website, the AMF displays a whitelist of ICOs that have been approved and a blacklist of those that publish inaccurate or misleading information or have their approval withdrawn.
The new regime introduced by the Pacte law “is intended to promote the development of ICOs,” the AMF detailed, adding that it only applies to the issue of utility tokens and does not apply to Security Token Offerings (STOs).
An issuer wanting to carry out an ICO may apply for approval from the AMF and meet a number of criteria. Firstly, it must be incorporated as a legal entity established or registered in France. Secondly, its whitepaper must be drawn up in accordance with Article 712-2 of the AMF General Regulation and with AMF Instruction DOC-2019-06.
Anne Maréchal, AMF Director of Legal Affairs, believes that “The optional approval is a good compromise for attracting serious ICO projects and innovation in France while ensuring investor protection,” the regulator quoted her as saying.
A procedure to monitor and safeguard the funds raised by the ICO must be implemented and a system to ensure compliance with its anti-money laundering and financing of terrorism obligations must be put in place. The AMF further emphasized that “Although this approval is optional and ICOs without AMF approval will therefore continue to be legal, only those public offerings that have received the AMF approval may be marketed directly to the public in France.”