Swiss CMTA AML standards for Digital Assets
The Capital Markets and Technology Association (CMTA) is an independent Swiss association bringing together experts from the financial, technological, audit and legal sectors to promote the use of new technologies in capital markets. The CMTA provides a platform to create open industry standards around issuing, distributing and trading securities and other financial instruments in the form of "Digital Assets" using "Distributed Ledger Technologies" or "DLT".
As part of its mission, the CMTA developed a set of AML standards for Digital Assets (the "Standards") and is making the first version of the Standards public. The reference to AML in these Standards includes a reference to CFT.
The Standards are divided in two parts:
Part I of the Standards is addressed to issuers of Digital Assets ("Issuers") planning to raise capital by issuing and selling Digital Assets as part of an initial coin or token offering (the "Initial Coin Offering" or "ICO") or similar Digital Asset sale process, irrespective of its formal designation.
Part II of the Standards is addressed to Swiss banks, securities dealers and other financial intermediaries pursuant to AMLA (each a "Financial Intermediary") that enter into business relationships with Issuers, investors in Digital Assets ("IDA") or other types of clients whose business involves a material exposure to Digital Assets and/or DLT.
The Standards have been developed on the basis of, and taking into account, in particular:
the Swiss Anti-Money Laundering Act (AMLA);
the Swiss Anti-Money Laundering Ordinance (AMLO);
FINMA's Anti-Money Laundering Ordinance (AMLO-FINMA);
FINMA Circular 16/7 "Video and online identification";
the Agreement on the Swiss banks' code of conduct with regard to the exercise of due diligence (CDB 16); and
the revised versions of the above documents that are expected to enter into force on 1 January 2020.
The Standards also take into consideration the Leitfaden der SBVg zur Eröffnung von Firmenkonti für Blockchain-Unternehmen published by the Swiss Bankers Association on 21 September 2018.
By contrast, the Standards do not address due diligence, documentation and compliance requirements or obligations of Issuers deriving from other Swiss or foreign legal or regulatory provisions, such as, without limitation, tax or reporting requirements under the Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS), respectively financial markets reporting, securities or other financial market laws and regulations or conduct requirements under applicable laws.
The application of the Standards is not mandatory and does not represent a binding minimum standard. However, the CMTA considers them as a practical toolkit that may, as a matter of example, be used by Swiss banks, securities dealers and other Financial Intermediaries to develop their own risk-based approach as part of the implementation of their respective obligations in accordance with applicable laws and regulations in the field of AML compliance.
Although the core of the Standards aims to be technology-neutral to all possible extents, they need to be practical. The CMTA may therefore, from time to time, proceed to adjustments and amendments of the Standards and publish revisions, additions or updates.