The UK FCA (Financial Conduct Authority) published a Handbook notice which includes details of Crypto Business Registration Fee in the UK. Companies with UK crypto assets incomes of up to £ 250,000 have to pay £ 2,000. But companies with incomes above £ 250,000 have to pay £ 10,000 registration fee. The FCA says it will not return the fee if the company appears to have used the gateway to verify its eligibility.
04 February, 2020 | AtoZ Markets – The UK’s Financial Conduct Authority (FCA) announced that it updated the registration fee for cryptocurrency activities. The registration fee structure has revised based on a round table meeting with cryptocurrency firms in October last year. It was proposed in the meeting that £ 5,000 fee might be too high for smaller firms and start-ups.
UK FCA Updates on Crypto Business Registration Fees
UK FCA has introduced two separate fees for crypto firms based on their size. These are:
- The Registration Fee is £2000 for businesses with incomes up to £250,000.
- The Registration Fee is £10000 for larger businesses with incomes above £250,000.
The FCA points out that the entry fees are non-refundable if the regulator refuses registration. If an applicant is not eligible for registration, they should not have applied first. The FCA will consider refunding the fee if the company can demonstrate that it has done its best to clarify its status before applying. The FCA also said:
“We are financed entirely from the fees and duties of the companies we regulate. However, we proposed a £ 5,000 registration fee to recover the estimated gateway costs of £ 400,000 from about 80 potential applicants known to us.”
Is Indirect Costs of Compliance Too Much?
Some respondents argued that small businesses shouldn’t pay fees, and one suggested that they shouldn’t be regulated at all. In response to these comments, the FCA also stated:
“There are costs involved in starting any business. So, it is not unusual for companies to budget for a loss in the early years,” noted the regulatory authority. “One presented evidence that direct regulatory fees and duties typically accounted for 3% -4% of business revenue. However, indirect compliance costs represented 16% of revenue for businesses with revenue up to £ 250,000”.
The FCA adds that some of the smaller brokers, may not be operating “commercially”, in which case they may not require registration under the MLR. However, they should refer to the section relating to the activity carried out for consideration on the FCA website to assess whether they are likely to be registered. Moreover, if necessary, seek independent legal advice. The FCA stated:
“Parliament has mandated us to regulate all crypto asset firms that carry out the activities listed in the legislation. It has no limits on size.” We cannot choose who to regulate. It is right that all regulated companies contribute to the costs of supervision. “
The FCA has also stated that existing companies that perform crypto-asset activities must be registered with it by January next year. Besides, to ensure compliance with the deadline, they required to submit a completed registration application by June 2020.
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