Israel to Regulate Financial Service Providers Dealing in Virtual Currency
The law’s definitions provide that a “virtual currency” is among the financial assets regarding which the provision of services requires a permit and is subject to regulatory oversight
law.co.il
| 31/07/2016
Robocoin ATM debuts in Tel Aviv - http://www.israel21c.org/tel-aviv-welcomes-first-two-way-bitcoin-atm/
The Knesset (the Israeli Parliament) has passed into law legislation that would regulate, among others, financial service providers that deal in virtual currencies. The Supervision of Financial Services (Regulated Financial Services) Law, 5776-2016 seeks to comprehensively regulate non-institutional financial service providers (i.e., non-institutional currency service providers and credit providers), by developing the non-institutional financial services sector and establishing an alternative to the banking system with respect to financial services.
According to the newly enacted law, the Israeli Minister of Finance will appoint a supervisor of financial service providers. Provision of financial services will be subject to a permit. The law prescribes mechanisms for permit application and issuance, shareholder control of financial service providers and their corporate organs and officers. The law’s definitions provide that a “virtual currency” is among the financial assets regarding which the provision of services requires a permit and is subject to regulatory oversight. The law does not, however, define or clarify what does or does not constitute “virtual currency”. The main threshold requirements for a permit for the provision of financial services are a minimal initial capital of 300,000 NIS (approximately US $78,000) and no criminal record of offenses of a nature that would preclude engaging in financial services.
The law also includes consumer protection provisions such as a prohibition of unfair and misleading practices. The supervisor of financial service providers will also serve as an ombudsperson for consumer complaints, and will be vested with investigative and enforcement powers.
The statute’s provisions regarding financial service providers (including those dealing in virtual currency) will enter into force no earlier than June 1, 2018.
Source: www.law.co.il
The law’s definitions provide that a “virtual currency” is among the financial assets regarding which the provision of services requires a permit and is subject to regulatory oversight
Robocoin ATM debuts in Tel Aviv - http://www.israel21c.org/tel-aviv-welcomes-first-two-way-bitcoin-atm/
The Knesset (the Israeli Parliament) has passed into law legislation that would regulate, among others, financial service providers that deal in virtual currencies. The Supervision of Financial Services (Regulated Financial Services) Law, 5776-2016 seeks to comprehensively regulate non-institutional financial service providers (i.e., non-institutional currency service providers and credit providers), by developing the non-institutional financial services sector and establishing an alternative to the banking system with respect to financial services.
According to the newly enacted law, the Israeli Minister of Finance will appoint a supervisor of financial service providers. Provision of financial services will be subject to a permit. The law prescribes mechanisms for permit application and issuance, shareholder control of financial service providers and their corporate organs and officers. The law’s definitions provide that a “virtual currency” is among the financial assets regarding which the provision of services requires a permit and is subject to regulatory oversight. The law does not, however, define or clarify what does or does not constitute “virtual currency”. The main threshold requirements for a permit for the provision of financial services are a minimal initial capital of 300,000 NIS (approximately US $78,000) and no criminal record of offenses of a nature that would preclude engaging in financial services.
The law also includes consumer protection provisions such as a prohibition of unfair and misleading practices. The supervisor of financial service providers will also serve as an ombudsperson for consumer complaints, and will be vested with investigative and enforcement powers.
The statute’s provisions regarding financial service providers (including those dealing in virtual currency) will enter into force no earlier than June 1, 2018.
Source: www.law.co.il
