SWEDEN Law and Practice Contributed by: Niclas Rockborn, Rikard Sundstedt and Robin Entenza, Gernandt & Danielsson
ment. Under this framework, the fraudulent use of non-cash means of payment is a criminal offence. The definition of non-cash means of payment is broad and includes instruments that enable transfers of virtual currency. In this context, a virtual currency is understood as a digital representation of value that is not issued or guaranteed by a central bank or public authority, is not necessarily linked to a legally estab- lished currency and does not have the legal status of currency or money, but is accepted by natural or legal persons as a means of exchange and can be trans- ferred, stored and traded electronically. MiCA has introduced a dedicated market abuse regime for virtual currencies, drawing on the princi- ples already familiar from the Market Abuse Regula- tion applicable to financial instruments. Under MiCA, issuers of virtual currencies that are admitted to trad- ing on an authorised trading platform are required to disclose insider information. In addition, MiCA pro- hibits insider dealing, market manipulation and the unlawful disclosure of inside information in relation to In 2013, the SFSA intervened against a person provid- ing money remittance services by receiving fiat cur- rency from Swedish customers and using those funds to purchase Bitcoin from an exchange service provider in Iran. The customers could subsequently instruct the Iranian exchange service provider on how to settle the outstanding balance, eg, by exchanging the balance in Bitcoin into local currency. In essence, this enabled the customers to transfer money from Sweden to Iran by way of exchanges into and from Bitcoin. The SFSA ordered the provider to cease operations on the basis that the activities constituted licensable payment ser- vices. The decision was appealed but was upheld by the Stockholm Administrative Court in 2014. In 2021, the SFSA initiated a thematic supervisory review of anti-money laundering compliance by two Swedish cryptocurrency exchanges. One of the inves- tigations was concluded without any formal supervi- sory intervention, while the other resulted in an admin - istrative fine of SEK2 million. such virtual currencies. 2.6 Non-Compliance
These supervisory activities occurred prior to MiCA, at a time when activities relating to crypto-assets were not heavily or extensively regulated. With MiCA, a change can be expected in the supervisory enforce- ment attitude toward regulated firms in the area of non-compliance, not only because the regulatory obli- gations are vastly more comprehensive and rigorous, but also because the scope and scale of activities have been significantly expanded to advisory servic- es, portfolio management services, brokerage, and other services. 3. Licensing and Set-Up Requirements 3.1 Licensing Requirements Licensing Before MiCA, digital asset-related activities were largely outside the scope of Swedish licensing require- ments, with only service providers offering services for the exchange of virtual currencies or custodian wallet services being subject to regulatory registration requirements. However, MiCA significantly expanded the scope of licensable activities relating to digital assets, imposing authorisation requirements for issu- ers of asset-referenced tokens and for crypto-asset service providers (eg, trading, exchanging, transfer- ring or advising in relation to crypto-assets). As a temporary transitional measure, existing provid- ers of crypto-asset services who became subject to regulatory authorisation requirements under MiCA were afforded a limited time period to continue their operations before obtaining MiCA authorisation. MiCA affords individual EU member states a degree of flex- ibility in determining the duration of the transitional relief period and Sweden elected to permit service providers who were lawfully operational before 30 December 2024 to continue their operations until 30 September 2025. As this time has now expired, the full scope of authorisation requirements set out in MiCA now applies in Sweden. Territorial Scope As a general principle, Swedish financial regulatory licensing requirements only apply to activities that are deemed to be conducted in Sweden, which covers
620 CHAMBERS.COM
Powered by FlippingBook