The NSSMC at the International Forum «Financial Monitoring 2023» spoke about the introduction of regulation of virtual assets in Ukraine

The National Securities and Stock Market Commission (NSSMC) took part in the international forum «Financial Monitoring 2023», which took place on December 7-8 in Ternopil.

The regulator was represented at the event by Vladyslav Budiakov, Head of the Department for State Regulation of Turnover in the Virtual Assets Market of the NSSMC. He spoke about virtual assets, the existing problems of regulatory implementation, ways to solve them and progress. He also spoke about the draft law on virtual assets developed by the NSSMC.

As you know, Ukraine has had the Law of Ukraine on Virtual Assets for quite some time, but it has not been in force because the necessary amendments to the Tax Code have not yet been adopted. Even in hot pursuit, in the first days after the outbreak of a full-scale war, it became clear that it was morally obsolete and that it was impossible to offer an adequate taxation regime for virtual assets on its basis.

Thus, it was decided that there was no need to reinvent the wheel to overcome this situation, and given Ukraine’s European integration choice and the adoption of the EU Regulation on Markets in Virtual Assets (MiCA), it was necessary to implement its provisions in Ukrainian legislation.

To this end, the NSSMC, with the support of the USAID Financial Sector Reform project, engaged the best specialists from one of the Big Four representatives, Ernst & Young, to develop a new draft law. The text of the draft law was publicly discussed in the format of the Advisory Council on the Regulation of Virtual Assets under the NSSMC, which was attended by representatives of state and law enforcement agencies, market experts, and representatives of the deputy corps. The NSSMC received almost two hundred comments and almost a quarter of them were taken into account.

Subsequently, the draft law was sent for approval to the Ministry of Finance, the Ministry of Digital Transformation, the Ministry of Justice, the State Financial Monitoring Service, and the National Bank of Ukraine.

It is important that the draft law was approved by EU experts, who paid special attention to analyzing its compliance with the requirements of European AML/CFT policies. This took place as part of the implementation of the recommendations of the European Commission’s Opinion on Ukraine’s application for EU membership in terms of compliance of national anti-money laundering legislation with FATF standards, through the Government Office for Coordination of European and Euro-Atlantic Integration of the Cabinet of Ministers.

The draft law proposed by the NSSMC is notable for taking into account all proposals, especially those of the State Financial Monitoring Service of Ukraine and EU experts, complies with FATF standards and accelerates the implementation of Recommendation 15, creates an effective mechanism for compliance with European standards, and is designed to promote technological development, ensure financial stability and investor protection.

The Forum is organized by the State Financial Monitoring Service of Ukraine and the Academy of Financial Monitoring with the support of the OSCE Support Program for Ukraine, the Council of Europe and the EU Anti-Corruption Initiative in Ukraine (EUACI).