Parliamentary Secretary for Financial Services, Digital Economy and Innovation Hon. Silvio Schembri announced the launch of the Malta Digital Innovation Authority at the DELTA Summit. The establishment of this Authority was one of the legislative measures upheld within the three Blockchain Acts unanimously approved by the Maltese Parliament earlier on this year.
Always at the forefront of such legislative developments, Chetcuti Cauchi Advocates has sought to embrace the spirit of the industry by fusing its traditional know-how with the innovations brought forward by the Fintech industry in order to assist clients which are all eyeing Malta as the place to be.
The Malta Digital Innovation Authority
Dr Priscilla Mifsud Parker, Senior Partner at Chetcuti Cauchi notes that "The Malta Digital Innovation Authority has been set up. It is the Authority responsible for developing and regulating the innovative technology industry in Malta. As part of the efforts Malta has made to establish itself as the world's first Blockchain Island, this Authority will find a balance between regulating whilst allowing for technological progress. The MDIA shall act as the regulatory body responsible for the certification of technology arrangements and the official registration of Systems Auditors and Technical Administrators. Whilst ensuring that sound balance has been struck between the need to regulate and the promotion of innovation on one hand, the Authority will also seek to safeguard the integrity of the market, as well as the protection of consumers and investors.
As the MDIA ceases to exist solely on paper but is now becoming an established Authority in its own right, Mr Steve Muscat Azzopardi, Head of Fintech at Chetcuti Cauchi Advocates explains: "This is a game changer as for the first time, the technology underlying a business model will be audited and certified. For serious businesses and entrepreneurs looking to leverage the power of blockchain, this allows them to gain unparalleled consumer trust in their innovative technology."
What's Next?
The Government has formally announced in the Government Gazette that the other two Acts, the Innovative Technology Arrangements and Services (ITAS) Act and the Virtual Financial Assets (VFA) Act shall come into force on 1st November 2018.
After the first of November, both blockchain technology companies, as well as issuers, cryptocurrency exchanges and other service providers will be able to continue operating seamlessly whilst simultaneously seeking to become compliant with the established legal framework. After 1st November, issuers who have launched their virtual financial asset offering will have 3 months within which they can register their whitepaper and employ the necessary functionaries, whilst cryptocurrency exchanges and other service providers will have 12 months within which they must submit their license application. Tech companies will also be able to seek due recognition from the MDIA.
The Blockchain Island
Malta has established itself as the Blockchain Island mainly through the approval of the world's first Blockchain legislation, however it has since made continuous efforts towards becoming a leader within the industry. The Maltese Government has assessed the impact that blockchain would have within other well-established industries in Malta by endorsing blockchain technologies within the Malta Stock Exchange and setting up Blockchain Scholarships within the University of Malta. To further solidify its belief in this industry, the Government has invested €250,000 in MITAmalta which has just inaugurated a new emerging technologies lab. Such efforts have caught the attention of various Blockchain companies, many of who have decided to embrace Malta's pro-business attitude and set-up shop within its shores.
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