BELGIUM Law and Practice Contributed by: Joan Carette, Philippe De Prez and Thomas Derval, Simont Braun
Obligations Imposed on Regtech Service Providers Under the outsourcing rules and DORA require - ments, before entering into outsourcing arrange - ments or arrangements with ICT service provid - ers, regulated entities must conduct a thorough due diligence on the service providers to ensure their suitability. Furthermore, regulated entities are required to impose multiple contractual obli - gations on regtech providers, such as agreed service levels, reporting obligations, continuity plans, termination assistance and audit obliga - tions. The audit clause generally allows regulat - ed entities as well as their regulator(s) to control or request key information from their provider. 10. Blockchain 10.1 Use of Blockchain in the Financial Services Industry Cryptocurrencies were initially thought of as a challenge to traditional banking players. However, the optics have now changed, and leg - acy players are adopting blockchain applications regarding a wide range of activities and services (from internal administrative organisation to cli - ent onboarding processes, crowdfunding set- ups and even broader market integration). Alongside the adoption of blockchain technol - ogy by incumbents, a new trend of “Web3” and decentralised finance projects developed by start-ups and scale-ups is currently emerging. 10.2 Local Regulators’ Approach to Blockchain The NBB has stated in the past that, although the technology looks promising, actual use cases for distributed ledger technologies (of which block - chain is only one particular type) are still rela -
tively limited in number and in scope. According to the NBB, attention is particularly required con - cerning the use of distributed ledger technology or blockchain technology, as institutions should be aware of the legal value of smart contracts or the information contained in the distributed ledger, the possible governance complications and the security or resilience threats that may exist at different nodes in the network. The FSMA is currently still the relevant regu - lator for virtual asset service providers and is responsible for their registration for AML pur - poses. Rules for the commercialisation of virtual currencies have been developed specifically for Belgium. 10.3 Classification of Blockchain Assets There are currently no regulations in place which explicitly detail the classification of cryp - to-assets. As a rule, if a crypto-asset displays the same characteristics as regulated financial or investment instruments, it may qualify as a regulated financial/investment instrument and fall within the scope of the related regulation. Guidance can however be found in communica - tions by the competent authorities, both at the European and Belgian level. In December 2024, ESMA published guidance on the conditions and criteria for the qualification of crypto-assets as financial instruments, as well as broader guid - ance on the classification of crypto-assets, including a standardised test. Local guidance includes a 2017 FSMA Communication on the risks of ICOs, where the FSMA assessed the similarities between crypto-assets, investment instruments, means of storage, calculation and exchange, and utility tokens, and a 2022 FSMA communication on the classification of crypto- assets as securities, financial or investment instruments, which provides some additional
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