The Markets in Crypto-Assets Regulation (MiCA) lays down uniform requirements for the issuance of crypto-assets and providers of crypto-asset services. MiCA will apply in full effect from 30 December 2024.

• Part I of this trilogy discussed the rules laid down with respect to the issue of crypto-assets and the admission to trading of such assets.
• Part II examined the rules with respect to crypto-asset service providers, or CASPs for short.
• This final part focuses on the Dutch legislation and regulations required for the implementation and enforcement of MiCA.

Dutch regulations

Although MiCA has direct effect, changes to the relevant Dutch regulations will be necessary. The following legislation has been proposed to this effect:

1. the MiCA and TFR implementation decree (Implementation Decree), the adoption of which was recently recommended by the Council of State;
2. the Crypto-Assets Regulation (Implementation) Act (Implementation Act I), which was enacted by the Dutch House of Representatives on 26 November 2024;
3. the Transfers of Funds Regulation (Implementation) Act (Implementation Act II), which was also passed by the Dutch House of Representatives on 26 November 2024;

Implementation Decree

The Implementation Decree provides for changes that are needed at the subsidiarity level for MiCA and Regulation (EU) 2023/1113 of the European Parliament and of the Council of 31 May 2023 on information accompanying transfers of funds and certain crypto-assets and amending Directive (EU) 2015/849 (Transfer of Funds Regulation (TFR)).

Designation of competent authorities

Article 93(1) MiCA provides that the Netherlands must designate the competent authorities responsible

for carrying out the functions and duties provides for in MiCA. To achieve this objective, the Implementation Decree amends the EU AML Regulations Decree (the Decree). It is proposed that the DNB (De Nederlandsche Bank) will supervise the asset referenced tokens (ARTs) and the e-money tokens (EMTs). The AFM (Dutch Financial Markets Authority) will supervise the other elements of MiCA, including supervision of crypto-asset service providers (CASPs). This division of supervision is subject to a few exceptions. For example, the DNB is the designated supervisor in relation to the articles with prudential requirements applying to CASPs.

Please be referred to part I of this trilogy for more information about ARTs and EMTs. The requirements applying to CASPs are dealt with in detail in part II.

Enforcement

In line with the proposed amendments to the Decree, the Implementation Decree also determines which powers of enforcement under which MiCA articles are assigned to the supervisors and that any infringement of such article is liable to the imposition of an order subject to a penalty for non-compliance or an administrative fine (including the category of such fine).

Ban against exercising certain management functions

The Implementation Decree also provides that, in the event of certain infringements of MiCA articles, the supervisors may proceed to impose a temporary ban preventing members of the management body of a CASP from exercising policy-making and management functions. 

Member State option (Article 143(3) MiCA)

Article 143(3) MiCA provides that CASPs that provided their services before the entry into force of MiCA may continue to do so for up to eighteen (18) months after the date when MiCA enters into force. Member States may decide not to apply the transitional regime or to reduce its duration. The Dutch government has decided to go for the latter option, which is reflected in the Implementation Decree: the transitional regime ends on 30 June 2025.

For the duration of the transitional regime CASPs will be allowed to provide their services in accordance with the law applicable before the entry into force of MiCA. In the Netherlands, the CASPs affected exclusively concern providers of services for the exchange of crypto-assets for funds and providers of wallets who at the time of entry into force of MiCA were registered in the DNB register (the current registration requirement will be replaced by MiCA's authorisation requirement). These CASPs will be required to comply with MiCA from 30 June 2025 onwards.

Article IV of the Implementation Act II includes a transitional clause setting out which provisions of the Money Laundering and Terrorist Financing (Prevention) Act [Wet ter voorkoming van witwassen en financieren van terrorisme (Wwft)] and the Sanctions Act 1977 [Sanctiewet 1977] remain in force for the duration of the transitional regime.

Implementation Act I

The Implementation Act I provides for amendments to the Financial Supervision Act [Wet financieel toezicht (Wft)]. Pursuant to these amendments, specific enforcement powers are assigned to the AFM and the DNB. A further purpose of the Implementation Act I is to amend the Economic Offences Act [Wet op de economische delicten (Wed)]. As a consequence of these amendments, a number of provisions from MiCA are brought within the scope of criminal law. The amendments will be addressed in more detail below.

Wft - enforcement under administrative law

Article 94(1) and (3) and Article 111(5) MiCA confer additional specific supervisory and investigative powers on competent authorities. These powers are not yet part of the current set of tools available to the authorities under the Wft. This is about to change, as the Implementation Act I will introduce Article 1:77n into the Wft. Following the introduction of Article 1:77n Wft, competent authorities will have at least the following new powers:

1. to prohibit:
   1. the provision of crypto-asset services;
   2. an offer to the public of crypto-assets; or
   3. marketing communications;
2. to suspend:
   1. or to require a CASP to suspend, the provision of crypto-asset services; or
   2. or to require a CASP operating a trading platform for crypto-assets to suspend, trading of the crypto-assets;
3. to disclose all material information which might have an effect on the provision of the crypto-asset services concerned, or on the assessment of the crypto-asset offered to the public or admitted to trading;
4. to require the transfer of existing contracts to another crypto-asset provider.

It is proposed in the Implementation Act I to add the new Article 1:77n Wft to the annexes to the existing Articles 1:79 and 1:80 Wft. This will allow the supervisory authority to impose an order subject to a penalty for non-compliance or an administrative fine in the event of an infringement of the requirements laid down in Article 1:77n Wft. The associated categories of administrative fine will be incorporated into the Administrative Fines (Financial Sector) Decree [Besluit bestuurlijke boetes financiële sector].

Wed - enforcement under criminal law

The Implementation Act I also serves to amend the Wed. The consequence is that infringement of a number of MiCA provisions will constitute an economic offence within the meaning of the Wed. As is clear from the Explanatory Memorandum to the Implementation Act I, the provisions concerned can be divided into the following categories: authorisation requirement, prudential requirements, market abuse, independent audits, and the provision of information to the public.

Depending on the answer to the question whether there has been intent [opzet], an infringement will classify as either a lesser offence [overtreding] or a serious offence [misdrijf] within the meaning of the Wed. The classification then determines the severity of the penalty that can be imposed. Penalties capable of being imposed include (variable terms of) imprisonment, community punishment orders and fines (of varying amounts).

Dual system

Enforcement of any infringement of the MiCA provisions named may be made under administrative law or under criminal law, with criminal law being the ultimate remedy. In specific cases, criminal prosecution may be more suitable and effective.

Implementation Act II

Amending the scope of the Wwft

At the same time as MiCA, the TFR will enter into force. The TFR must be considered in conjunction with the implementation of MiCA. The TFR regulates the information accompanying transfers of fund and certain crypto-assets and amends the fourth AML directive. Nearly the entire scope of the Implementation Act II concerns the implementation of the amendments made to the fourth AML directive. The provisions to be amended have been laid down in the Wwft.

Under the TFR, the scope of the Wwft extends to all, or virtually all, CASPs that fall under the scope of MiCA. As a consequence, these CASPs will henceforth be required to conduct customer due diligence and report suspicious transactions, among other things.

Sanctions Act 1977

As a consequence of the Implementation Act II, CASPs falling under the scope of the Wwft will also fall under the scope of the Sanctions Act 1977. This means, among other things, that these CASPs will have to verify whether their customers appear on any sanctions list.

Supervisory authorities

On account of the fact that the AFM will supervise the CASPs, it is proposed in the Implementation Act II that the AFM also be appointed the competent authority responsible for supervising compliance with the 

requirements for CASPs ensuing from the TFR, the Wwft and the Sanctions Act 1977.

Providers of custodian wallets and CASPs that exchange crypto-assets for funds

Currently conducted by the DNB, the (integrity) supervision of providers of custodian wallets and CASPs that exchange crypto-assets for funds will pass to the AFM as a consequence of the implementation of MiCA. Banks and e-money institutions that provide crypto-asset services will continue to remain under the supervision of the DNB.

Conclusion

This concludes our recap of the key changes in Dutch legislation and regulations that will enable the implementation and enforcement of MiCA. The months ahead will show how the new rules will pan out in actual practice. We will of course be happy to keep you updated on any relevant developments. And you are welcome to contact us with any MiCA-related issues or questions troubling you.