[PRESS] The Slovenian blockchain industry warns: the domestic regulation should encourage, and not inhibit the competitive presence of Slovene companies
At the regular meeting of the Working Group for Regulation, key representatives of Slovenian blockchain companies highlighted the legal obstacles and challenges they face in doing business. They addressed urgent amendments to the Anti-Money Laundering and Terrorist Financing Act (ZZPDFT-1), which in the present form limit competitiveness on the global market for many fintech companies and all those that do business digitally. They, therefore, consider it crucial that the changes follow the European AMLD 5 directive and are implemented in the Slovenian legal order in a way that the law does not introduce more stringent rules than those at the European level.
The event was organized by the Working group for regulation, which operates under the Blockchain Think Tank Slovenia, in partnership with Blockchain Alliance Europe. It gathered key representatives of Slovene blockchain companies who openly addressed the issues that the innovative industry is facing in the global market.
The main reason behind the meeting was the adoption of the AMLD 5, aka. the Directive (EU) 2018/843, which is the first legal Act to introduce certain rules for enterprises dealing with cryptocurrencies throughout the European Union. They also reviewed the existing Slovene regulation of the Law on the Prevention of Money Laundering and Financing of Terrorism (ZZPDFT-1), which contains very restrictive provisions and regulations for blockchain companies.
The full hall has confirmed that Slovenian companies have a firm stand for a regulated legal environment that would allow them work under predictable conditions. In the development of appropriate legal solutions, two important findings were highlighted: anonymity in the world blockchain technology is more a myth than a reality; therefore, the increased risk of money laundering and terrorist financing is wrongly attributed to the companies in this field; Simplification of legislation on the prevention of money laundering and terrorist financing is also a prerequisite for Slovenia to ensure the competitiveness of domestic blockchain and fintech companies in the era of digitalization.
The discussion was led by the coordinator of the Working Group for Regulation Aljaž Jadek from the law office Jadek&Pensa and a member of the Blockchain Think Tank Slovenia Board of Directors, who underlined: “Stricter measures than those at EU level would put Slovenian companies in a worse starting position. As a result, foreign companies that are subject to more lenient measures would easily enter Slovenia, leading to a troublesome consequences for our entire society. Stricter rules than those at EU level are therefore acting as inhibitors of development; and this is particularly true for the innovative industry, which seeks out and succeeds in the marketplace outside of the established business practices.” You can learn more on the subject in the interview with Aljaz Jadek.
Representatives of the blockchain industry have also discussed remote customer identifications, and agreed that the existing provisions on identifying and verifying customer’s identity using video identification are restrictive and practically unusable. They pointed out that businesses using the blockchain technology should comply with all rules that apply to normal business, without any additional restrictions and exclusions.
Following this, four Slovenian companies that actively develop solutions in the field of digital identity verification presented their views on the restrictions on Slovenian business environment. Borut Hrobat (CDE d.o.o.) spoke about the possibilities and obstacles in video identification as a video identification provider; Tomaž Furlan (Nxxtech & Netis blockchain technologies) presented the possibilities for companies with blockchain technology to facilitate the login and verification of web service users; Luka Planinc (Eligma) presented how they approached to solving the current legislative challenges themselves. The last one on the stage was Peter Trcek (LoCoins and Bitnik, chairman of Blockchain Think Tank).
They also agreed at the meeting it is crucial for the industry that the blockchain technology ceases to be equated with cryptocurrencies which are just one of many possible ways of using it. The problem of regulation touches a much wider field, namely the entire fintech industry, which responds to the demanding needs and expectations of consumers through the digitalization of services. It is crucial that regulators support and encourage innovation, as rapid changes are driven by proactive adaptation.
In planning future activities, industry representatives will be even more committed to raising awareness, raising the reputation of the industry and finding examples of good practices, which will help their business partners and the country understand their business and reduce the risks and uncertainties that this industry is (unjustifiably) subjected to.
A position on the prevention of money laundering and terrorist financing will be formulated by representatives of the blockchain industry in the coming days in order to forward them to regulators and ministries. They want to help them with their insight and expertise to understand the subject matter and thus facilitate the adoption of appropriate regulations with the least negative consequences for the economy.
About Blockchain Alliance Europe
The Blockchain Alliance Europe Association was created with the purpose of mutual assistance in the field of business development, networking and cooperation, and a joint presence in the field of advocating the interests of members of the association. It aims to raise the awareness of the expert and lay public about the blockchain technology, and therefore organizes various events and education for this purpose. It also works with state authorities in the field of relevant legislation.
About Blockchain Think Tank Slovenia
Blockchain Think Tank Slovenia is a non-profit company open to all stakeholders interested in blockchain technology. Think Tank acts as a single point for collecting ideas and suggestions, and at the same time it has access to relevant representatives on the side of governments, regulators and other public sector institutions, which in an open way convey ideas and suggestions from the economy, entrepreneurs, academics and individuals.