Italy Completes Consultations on Registration of Crypto Companies

Public consultations on a new regulatory regime for crypto companies in Italy are now closed. Interested parties were invited by the Ministry of Economy and Finance to share suggestions and comments on a draft decree introducing registration and reporting requirements in the sector. The new set of rules will come into force within 3 months of adoption.

Also read: Spain Mulls Tax Breaks for Blockchain and Crypto Firms

Italy Trying to Understand the Phenomenon

Italy Completes Consultations on Registration of Crypto CompaniesThe ministerial decree has been designed to “explore and understand the various aspects of the virtual currency phenomenon”. The legal document, aimed at implementing Italy’s updated and “strengthened” anti-money laundering laws, was published by MEF’s Treasury Department on February 2. Interested parties had two weeks to express their opinions and suggest amendments.

In May 2017 the Italian government issued another decree requiring “service providers related to the use of virtual currency”, like exchanges, to fulfil their obligations to prevent money laundering and illicit crypto transactions. The new document introduces additional responsibilities for crypto businesses. They will have to report regularly their activities to the Finance Ministry.

The text of the proposed decree clarifies that although cryptocurrency is used as a “means of exchange for the purchase of goods and services”, it is not issued by a central bank or other public authority. The embedded disclaimer also states that cryptos are “not necessarily connected to a currency that is a legal tender”.

Exchanges and Merchants to Register and Report

The new notification regime will also be applicable to commercial companies accepting cryptocurrency payments for goods, services and utilities. The Ministry wants to conduct a “systematic survey” starting with determining the number of operators in the sector. Upon commencing activity, every company should register with the Italian Agency of Intermediaries OAM in order to operate legally in the country.

Italy Completes Consultations on Registration of Crypto Companies

The Department of the Treasury has already completed a preliminary evaluation of the technical specifications for the register, the Ministry of Finance said in a press release. The new regulatory regime is to be launched within 3 months after the decree enters into force. Its implementation responds to the need to understand the new phenomenon and its dimensions, said Roberto Ciciani, Head of the General Directorate for Prevention of Financial Crimes.

Regulators point out that the revised Italian legal framework will comply with the latest EU Anti-Money Laundering Directive – 5MLD, which introduces stricter rules to prevent financial crimes. The previous directive was adopted in Italy on May 25 last year.

The use of bitcoin and other cryptocurrencies by individuals remains largely unregulated in Italy. However, a law requiring identification of parties in crypto transactions has been introduced in the parliament. In 2016 the Italian tax authority Agenzia delle Entrate stated that cryptocurrency purchases and sales are exempt from VAT. With some limitations, personal crypto holdings and gains from transactions do not generate taxable income.

Do you think the new requirements for Italian companies to register and report will lead to more restrictions or to legalization of the crypto sector? Tell us in the comments section below.

Images courtesy of Shutterstock, Twitter.

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