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Best Practices for preparing MiCA license application

Legal professionals discussing MiCA license

At the moment when the Estonian cryptoasset market law is going through its procedures in the Parlament (Riigikogu) and its entry into force is expected is expected in the coming weeks, in our opinion it is still important to inform the market participants about the best practices and give tips when submitting a MiCA license application.

Certainly, the Estonian Financial Supervisory Authority (Finantsinspektsioon) will publish the necessary forms and presumably anticipate a more detailed guide, but based on our practice in the field of activity licenses, we have put together a reminder for companies

Based on the practice, we can say that potential crypto-asset service providers (CASPs) should prepare comprehensive license application well in advance to ensure a smooth and successful application process. This proactive approach minimizes the risk of operational disruptions due to the lack of necessary authorizations or notifications.

Our Best Practices for preparing MiCA license request:

Scoping and Legal Advice:

Determine which MiCA regulations apply to your organization, preferably with guidance from a specialized law firm. For instance, identify whether your services include operating a trading platform or providing crypto-asset advice.

Organizational Alignment:

Familiarize yourself with MiCA rules and assess the necessary adjustments to your organizational structure or business operations. Conduct a gap analysis comparing your current state to MiCA-compliant requirements, and plan to implement necessary changes promptly.

Expert Consultation:

Seek professional advice for your MiCAR application as needed, while maintaining full responsibility for and understanding of your license application. This advice may pertain to designing and implementing control measures, among other aspects.

Early Engagement:

Contact Gidea Advisory early on for high-impact matters or those with long lead times before beginning the formal application. Topics may include scoping, control structure setup, or asset segregation procedures design.

Regulatory Response:

Be prepared to respond promptly to any queries from the Estonian regulator (Finantsinspektsioon) starting from January 1, 2025. You may need to provide detailed explanations in writing or during supervisory interviews and improve your internal risk management framework or compliance function.

Comprehensive Documentation:

Submit a thorough license application that clearly demonstrates compliance with MiCA. Ensure all internal procedures meet the requirements, and provide a summary with clear references to supporting documents, such as policies and procedures. Complete all Fit & Proper testing forms accurately for all relevant personnel.

Summary of Best Practices for preparing MiCA license:

CASP Pre-Scan: Gidea Advisory offers an optional pre-scan procedure for companies preparing a CASP license application. This process enhances efficiency and builds mutual knowledge of key topics.

To be eligible for a pre-scan, the applicant must:

  • Confirm that their activities fall under the scope of MiCA (legal advice is recommended if in doubt).

  • Commit to applying for MiCA authorization in Estonia.

  • Be at an advanced preparation stage for substantive discussions on MiCA compliance policies.

  • Understand or be willing to acquire knowledge about applicable MiCA rules through professional legal advisory.

  • Seek advice in preparation for the MiCA application if necessary.

  • Submit a comprehensive license application with a clear list of included documents.

  • Be prepared to respond promptly to regulatory questions.

  • Apply for the pre-scan procedure before formal submission (optional).

Compliance with Anti-Money Laundering and Terrorist Financing Regulations:

As stipulated in MiCA, CASPs must comply with and demonstrate adherence to regulations to prevent money laundering and terrorist financing. The following documents, information, and records must be provided during the authorization process:

  • A detailed, comprehensive, and business model-specific description of the internal control system, including strategies and procedures for preventing money laundering and terrorist financing.

  • Detailed, complete, and business model-specific risk analysis at the entity and customer level. For operating entities, this analysis must be supported by relevant figures and data; for non-operational businesses, estimated and projected figures and data should be provided.

  • Evidence of the appointment of a designated Anti-Money Laundering Officer (FIU contact person in Estonia/MLRO) and deputy, including professional fitness (e.g., curriculum vitae and training certificates) and personal probity (e.g., criminal record). If available, evidence of an internal fit and proper assessment should also be provided.

Please note that the authorization process does not include the approval of processes, systems, and procedures for preventing money laundering and terrorist financing.


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