The Swiss federal government is passing to parliament a revised plan aimed to remove legal hurdles still holding up innovation based on blockchain and distributed ledger technology (DLT).
At a meeting on Nov. 27, the Federal Council – the executive body that constitutes the federal government – adopted a proposal to improve the legislative framework for the nascent technology. According to a notice from Switzerland's federal finance department, the move is aimed at "increasing legal certainty, removing barriers for applications based on distributed ledger technology (DLT) and reducing the risk of abuse."
The legislation, developed as a "blanket framework," proposes amendments to nine federal acts across civil and financial market law, according to the announcement.
The nation is already known as one that is crypto and blockchain friendly, with its Zug region playing host to a large number of industry firms. Facebook also chose to incorporate the Libra Association in Switzerland.
In 2018, the Federal Council issued a report saying that it would regulate crypto and blockchain largely under existing financial laws, though an amendment to securities laws was also propose to increase the legal certainty of crypto tokens. The same year, the Financial Market Supervisory Authority introduced a new fintech license with “relaxed” requirements that could be applied to blockchain and cryptocurrency firms.
In today's announcement, the Federal Council said the 2018 report had demonstrated that Switzerland's existing legal framework is "well suited" for new technologies such as DLT. However, it also showed that there's room for improvement in some areas.
To address those, the Federal Council opened up a number of proposed amendments to existing laws for consultation in March. Following around 80 responses, the amendments have been further revised and, now, adopted by the council.
The proposed legislation is expected to be examined by the Swiss parliament in early 2020.