Sign In
SEC News
SEC public hearing on principles and draft regulations under the Digital Asset Business Law



Thursday 17 May 2018 | No. 51 / 2018



Bangkok, 17 May 2018 ? The SEC is seeking public comments on the principles and draft regulations under the Digital Asset Business Law to lay out guidelines for supervising offering of digital tokens and undertaking of digital asset businesses without causing undue hindrance to stakeholders and those interested in providing digital asset-related services or compromising appropriate investor protection mechanism.?

The Royal Decree on Digital Asset Businesses B.E. 2561 (2018), which has become effective since 14 May 2018, stipulates that the SEC shall be the main regulator for digital token offering and undertaking of digital asset businesses with the authority to issue relevant rules, conditions and procedures.??

The public consultation covers the key principles for laying out appropriate regulations governing digital token offering and digital asset businesses. Such principles and relevant draft regulations abide by the new law's underlying purposes of facilitating legitimate uses of digital assets, protecting investors from frauds or exploitation, and preventing money laundering.

Regarding digital token offering, the Digital Asset Business Law requires filing of the registration statement and draft prospectus and approval from the SEC. In addition, such offering must be made through the SEC-recognized ICO portals. This public hearing covers key issues in this matter, e.g., approval rules, qualifications of ICO portals, and eligible types of investors.

Initially, the approval for digital token offering would be limited to companies established under Thai law in accordance with the policy of the Ministry of Finance. The approval criteria include clear disclosure of information, fairness and compliance ? there must be no grounds of suspicion regarding the issuer's intention to avoid regulatory compliance or exploit investors ? and integrity of directors and executives who must not have any prohibited characteristics.?

The proposed rules also specify the qualifications of ICO portals whose roles are to examine the quality of digital tokens to be offered for sale and to verify that the information provided in the registration statement and draft prospectus is accurate, clear and complete. The eligibility criteria for undertaking the ICO portal business include (1) being a company established under Thai Law, (2) having registered capital of at least 5 million baht, (3) not having directors and executives with prohibited characteristics, (4) putting in place issuer due diligence and product screening systems, (5) examining issuers? business plans and the source codes of smart contract, (6) conducting Know-Your-Customer (KYC) and Customer-Due-Diligence (CDD), and (7) providing suitability test for retail investors.

The SEC also seeks public comments on shelf filing whereby a series of fundraising would be allowed after an initial approval is granted, and eligibility criteria for retail investors, including the maximum investment amount of 300,000 baht for each offering. In addition, a maximum limit on the amount to be offered to retail investors for each offering is proposed.????

Pursuant to the Digital Asset Business Law, the types of digital asset business operators include (1) digital asset exchange, (2) digital asset broker, and (3) digital asset dealer ? all required to obtain an approval for operating respective businesses from the Minister of Finance and to maintain the standards specified by the SEC . The proposed rules also require that all digital asset business operators have an adequate source of fund, cybersecurity and IT risk management, Know-Your-Customer and Customer-Due-Diligence, and preventive measures against money laundering. In addition, digital assets and cryptocurrencies to be traded and exchanged must be specified by the SEC Board or denominated in Thai Baht only.

The consultation paper is available at https://capital.sec.or.th/webapp/phs/viewall/viewall.php(currencly available in Thai only). Stakeholders and interested parties are welcome to submit comments through the website, or email: aunchisa@sec.or.th, jirawut@sec.or.th or wasu@sec.or.th. The public hearing ends on 30 May 2018.?

________________________












Building Confidence in the Capital Market
NEWS
Securities and Exchange Commission
Corporate Communication and Investor Service Department
Tel. (66)2033-9502-5 E-mail: press@sec.or.th
No. 51 / 2018 Thursday 17 May 2018
SEC public hearing on principles and draft regulations under the Digital Asset Business Law


Bangkok, 17 May 2018 ? The SEC is seeking public comments on the principles and draft regulations under the Digital Asset Business Law to lay out guidelines for supervising offering of digital tokens and undertaking of digital asset businesses without causing undue hindrance to stakeholders and those interested in providing digital asset-related services or compromising appropriate investor protection mechanism.?

The Royal Decree on Digital Asset Businesses B.E. 2561 (2018), which has become effective since 14 May 2018, stipulates that the SEC shall be the main regulator for digital token offering and undertaking of digital asset businesses with the authority to issue relevant rules, conditions and procedures.??

The public consultation covers the key principles for laying out appropriate regulations governing digital token offering and digital asset businesses. Such principles and relevant draft regulations abide by the new law's underlying purposes of facilitating legitimate uses of digital assets, protecting investors from frauds or exploitation, and preventing money laundering.

Regarding digital token offering, the Digital Asset Business Law requires filing of the registration statement and draft prospectus and approval from the SEC. In addition, such offering must be made through the SEC-recognized ICO portals. This public hearing covers key issues in this matter, e.g., approval rules, qualifications of ICO portals, and eligible types of investors.

Initially, the approval for digital token offering would be limited to companies established under Thai law in accordance with the policy of the Ministry of Finance. The approval criteria include clear disclosure of information, fairness and compliance ? there must be no grounds of suspicion regarding the issuer's intention to avoid regulatory compliance or exploit investors ? and integrity of directors and executives who must not have any prohibited characteristics.?

The proposed rules also specify the qualifications of ICO portals whose roles are to examine the quality of digital tokens to be offered for sale and to verify that the information provided in the registration statement and draft prospectus is accurate, clear and complete. The eligibility criteria for undertaking the ICO portal business include (1) being a company established under Thai Law, (2) having registered capital of at least 5 million baht, (3) not having directors and executives with prohibited characteristics, (4) putting in place issuer due diligence and product screening systems, (5) examining issuers? business plans and the source codes of smart contract, (6) conducting Know-Your-Customer (KYC) and Customer-Due-Diligence (CDD), and (7) providing suitability test for retail investors.

The SEC also seeks public comments on shelf filing whereby a series of fundraising would be allowed after an initial approval is granted, and eligibility criteria for retail investors, including the maximum investment amount of 300,000 baht for each offering. In addition, a maximum limit on the amount to be offered to retail investors for each offering is proposed.????

Pursuant to the Digital Asset Business Law, the types of digital asset business operators include (1) digital asset exchange, (2) digital asset broker, and (3) digital asset dealer ? all required to obtain an approval for operating respective businesses from the Minister of Finance and to maintain the standards specified by the SEC . The proposed rules also require that all digital asset business operators have an adequate source of fund, cybersecurity and IT risk management, Know-Your-Customer and Customer-Due-Diligence, and preventive measures against money laundering. In addition, digital assets and cryptocurrencies to be traded and exchanged must be specified by the SEC Board or denominated in Thai Baht only.

The consultation paper is available at https://capital.sec.or.th/webapp/phs/viewall/viewall.php(currencly available in Thai only). Stakeholders and interested parties are welcome to submit comments through the website, or email: aunchisa@sec.or.th, jirawut@sec.or.th or wasu@sec.or.th. The public hearing ends on 30 May 2018.?

________________________