CRYPTOCURRENCY: With the enactment of the Loi PACTE, the French Regulatory Framework for Crypto-Activities and ICOs becomes effective.

Added on 31/05/2019

As extracted from, published on Thursday 30th May, 2019.


Act No. 2019-486 of May 22, 2019 (the Loi PACTE), which creates a regulatory framework for both initial coin offerings (ICOs) and cryptocurrency-related businesses, has finally been enacted by the French government and became effective on May 24, 2019.

The enactment of the Loi PACTE is the last step of a legislative process which saw France give a clear set of rules to the crypto-assets and blockchain industries. In addition to the Loi PACTE, France also passed in 2018 a law allowing the registration of unlisted securities on a blockchain, and clarified the tax and accounting regime applicable to cryptocurrencies investors and ICO issuers. The Loi PACTE also allows certain professional investment funds to purchase crypto-assets. France is arguably the first large country to establish such a comprehensive framework.

Our firm was involved from the very beginning of this legislative process and had extended discussions with the regulatory authorities at various steps of the elaboration of the Loi PACTE. The Paris office of Kramer Levin notably chairs the Fintech/ICO working group of Paris Europlace, the professional organization in charge of promoting Paris as an international financial center. As part of the Haut Comité Juridique de la Place Financière de Paris (a semi-public think tank tasked with proposing changes to French financial law), our firm also pushed for further studies on the use of blockchain by central securities depositories (in particular for the settlement of securities).

Since 2017, the French government and regulatory authorities have adopted a welcoming position toward the blockchain industry as a whole. Various official reports have been published on blockchain and crypto-assets, both by government bodies (Landau report of July 20181) and by the Parliament (report on the technological challenges of blockchains of July 2018;2 report on blockchains of December 2018;3 report on crypto-assets of January 20194). More recently, during the Paris Blockchain Conference of April 15, 2019, the Minister of Economy and Finance reaffirmed his goal to make France a world leader of the blockchain industry. French politicians seem to establish a clear distinction between blockchain (which they see as a revolutionary technology affecting all industries) and crypto-assets (which are still seen as risky speculative assets). However, even though blockchain is the trending topic among politicians, the Loi PACTE applies only to crypto-assets.

The most interesting feature of the legal regime established by the Loi PACTE is that it is not mandatory. ICO issuers will not need to obtain approval from the Financial Markets Authority (AMF) before offering their tokens, and crypto-assets intermediaries will not have to be licensed to offer crypto-related services. The underlying idea is to encourage these actors to apply for these approvals, by giving approved ICOs and licensed intermediaries certain legal rights (e.g., easier access to a bank account). It is also expected that the AMF’s approval or license will serve as a quality label which will help these companies market their tokens and products to consumers in France and abroad.