Gibraltar Bill Passage Paves Way for Blockchain Regulations

Lawmakers in Gibraltar approved a piece of legislation last week that advances the government's broader plans for blockchain.

On Dec. 6, legislators cleared a bill that amends the British overseas territory's Financial Services (Investment and Fiduciary Services) Act in order to "extend measures for the protection of investors to the customers of licensees carrying on controlled activities which are not investment services."

As arcane as that may seem, the bill represents a legal tweak intended to pave the way for new rules that officials made public last year as part of a bid to legally define blockchain's use in storing and transmitting value under Gibraltar law.

Albert Isola, Gibraltar's Minister of Commerce, celebrated the bill's passage and pointed to expected demand for licenses once the DLT-specific regulations are formally introduced in the new year.

Isola remarked:

"Gibraltar is one of the first jurisdictions in the world to introduce a regulatory framework for [distributed ledger technology] businesses thereby providing the regulatory certainty required by quality firms that we aim to attract to Gibraltar. I am aware that there are a number of businesses waiting to file their applications with the Gibraltar Financial Services Commission on 1st January 2018 and this is excellent news."

Given the passage of the latest bill, Gibraltar's Financial Services (Distributed Ledger Technology Providers) Regulations 2017 is likely to be approved as well. The next year may also see regulators in Gibraltar move to develop rules specifically aimed at initial coin offerings (ICOs) as suggested in a September statement on the blockchain funding model.

At the time, the Gibraltar Financial Services Commission said that it is "considering a complementary regulatory framework covering the promotion and sale of tokens, aligned with the DLT framework."

Gibraltar friend image via Shutterstock