The process of obtaining authorisation is preceded by a familiarisation stage, during which Latvijas Banka organises a meeting with the entrepreneur to discuss the planned activities. At this stage, the company does not necessarily have to be established yet.

What does the entrepreneur do

• Collects information on the company's shareholders and officials.
• Prepares information on the planned issuance model, admission to trading and the trading platform, the technical solutions to be used, and customers.
• Starts drafting the necessary documents.

What does Latvijas Banka do

• Provides advice on the applicable regulation and documents to be submitted.
• Conducts the initial conformity assessment.
• Assesses whether it is possible to continue the process of obtaining authorisation.

What additional actions should the entrepreneur take

• Carefully familiarise oneself with the requirements of legal acts.
• Assess the need to engage qualified consultants.
• When engaging consultants, the company should actively participate in the process so that the final result is appropriate for the business model and its inherent risks.

Documents to be submitted

• CVs of shareholders and officials;
• a description of the issuance, services, and their provision.

Costs

Latvijas Banka provides assistance with preparing an application and offers advice free of charge.

The entrepreneur prepares and submits an application for obtaining authorisation and for the approval of the white paper.

What does the entrepreneur do

• Submits a completed application, all accompanying information, and documents according to the requirements laid down in Articles 18 and 19 of Regulation (EU) 2023/1114 in compliance with the regulatory technical standards (RTS) (the RTS draft versions are available here).
• Receives information from Latvijas Banka on the commencement of the substantive review process of the application for authorisation or on any shortcomings that need to be addressed in the submitted application.
• Provides the necessary additional explanations.

What does Latvijas Banka do

• Within 25 working days, conducts a completeness check of the application and the white paper (a substantive assessment of the application has not yet been initiated).
• If the application is incomplete, notifies the entrepreneur by letter containing information on the identified shortcomings and sets a deadline by which they need to be addressed.
• If the application is complete, notifies the entrepreneur by letter containing information on the commencement of the application review.
• Designates the manager of the project on issuing authorisation and coordinates the process of obtaining authorisation.

What additional actions should the entrepreneur take

• Utilise advice offered by Latvijas Banka before submitting the application.
• Ensure the documents to be submitted are complete and of high quality.
• Prepare the documents according to the planned types of services.
• Check whether all the necessary documents have been submitted (refer to the list of documents to be submitted below).

List of documents to be submitted

A legal person submits an application to obtain authorisation to offer to the public the asset-referenced token or to request its admission to trading. The application is prepared according to the RTS requirements (the RTS draft versions are available here), appending the information and documents pursuant to the requirements of Regulation (EU) 2023/1114, to include the following.

1) A programme of operations which sets out the business model that the applicant issuer intends to follow.

2) A legal opinion that the asset-referenced token does not qualify as a crypto-asset excluded from the scope of Regulation (EU) 2023/1114 pursuant to Article 2(4), or an e-money token.

3) A detailed description of the governance arrangements referred to in Article 34(1) of Regulation (EU) 2023/1114.

4) A description of the internal control mechanisms and procedures of the specific crypto-asset service providers to ensure compliance with obligations in relation to money laundering and terrorism and proliferation financing under Directive (EU) 2015/849 (this applies where cooperation arrangements with specific crypto-asset service providers exist).

5) Information on the members of the management body, assessment of their repute, knowledge, skills, and experience (CVs, documents certifying their education, a statement from the Punishment Register).

6) Information on the stockholders (shareholders) that have a qualifying (direct or indirect) holding in the applicant and the size of the holding as well as information on the assessment of their repute (CVs, a statement from the Punishment Register); a description of the structure of the commercial company's stockholders (shareholders).

7) The crypto-asset white paper drawn up in accordance with the requirements of Article 19 of Regulation (EU) 2023/1114.

8) The policies and procedures referred to in Article 34(5), first subparagraph, of Regulation (EU) 2023/1114.

9) A description of the contractual arrangements with third-party entities referred to in Article 34(5) of Regulation (EU) 2023/1114.

10) A description of the business continuity policy referred to in Article 34(9) of Regulation (EU) 2023/1114, including effective plans for emergency situations as well as a description of the procedure for regularly checking and reviewing the suitability and efficiency of these plans.

11) A description of the internal control mechanisms and risk management procedures referred to in Article 34(10) of Regulation (EU) 2023/1114.

12) A description of the systems and procedures in place to safeguard the availability, authenticity, integrity and confidentiality of data referred to in Article 34(11) of Regulation (EU) 2023/1114.

13) A list of the host Member States where the applicant issuer intends to offer the asset-referenced token to the public or intends to seek admission to trading of the asset-referenced token (if applicable).

14) The articles of association, unless available in public registers.

Costs

A person (other than a financial market participant supervised by Latvijas Banka) that intends to offer an asset-referenced token to the public or seek its admission to trading, pays Latvijas Banka 2500 euro for the review of the application.

A financial market participant supervised by Latvijas Banka, including an issuer that has already obtained authorisation to offer an asset-referenced token to the public or seek its admission to trading, pays Latvijas Banka 1250 euro for the review of each additional asset-referenced token application, with the total annual payments, regardless of the number of applications, not exceeding 5000 euro per year.

Review deadline for application

25 business days for a completeness check of an application.

Within 60 working days following the confirmation that the application is complete, Latvijas Banka reviews the application and takes a decision to issue or refuse to issue authorisation. The review deadline for the application may be extended for objective reasons if the information provided in the application is insufficient to take a decision.

Latvijas Banka carries out a substantive assessment of the application.

What does the entrepreneur do

• Follows the review process of the application, consulting the project manager designated by Latvijas Banka.
• Responds to Latvijas Banka's requests for additional information as soon as possible as well as appoints a contact person to ensure optimum communication.
• Makes corrections to the submitted documents in line with Latvijas Banka's instructions.
• Participates in the meetings held by Latvijas Banka.

What does Latvijas Banka do

• Carries out a substantive assessment of the application.
• Communicates with the entrepreneur's contact person in case shortcomings have been identified and drafts a letter.
• Continues reviewing the application in line with the submitted additions.
• Completes the assessment of the application.

What additional actions should the entrepreneur take

• Follow the course of the review of the application.
• Provide additional explanations and make the necessary corrections as soon as possible.
• Representatives of the entrepreneur, rather than only consultants (if engaged), are also invited to participate in the meetings held by Latvijas Banka.

Costs

No additional costs associated with the review of documents are involved during the assessment stage of the application.

Latvijas Banka completes the assessment of the application and takes a decision to grant or refuse to grant authorisation.

What does the entrepreneur do

• Prepares to obtain authorisation and start operating in accordance with the business plan and the procedures developed in association with the internal control system.
• Designates users of Latvijas Banka's data reporting system for future communication with Latvijas Banka and submission of performance reports.

What does Latvijas Banka do

• Drafts a decision to grant or refuse to grant authorisation.
• Informs the entrepreneur of the decision taken.
• In the case of a positive decision, publishes information on its website and provides information to the European Securities and Markets Authority.

What additional actions should the entrepreneur take

• Familiarise oneself with the information provided by Latvijas Banka regarding access to the data reporting system.
• Familiarise oneself with the information related to the requirements and procedure for submitting performance reports.
• Prepare to start operating in accordance with the approved business plan and procedures.

Costs

No additional costs associated with obtaining authorisation are involved during the stage of obtaining authorisation.

Latvijas Banka supervises the operation of the company in accordance with the requirements of Regulation (EU) 2023/1114.

What does the entrepreneur do

• Responds to Latvijas Banka's requests.
• Drafts reports in accordance with the requirements of Regulation (EU) 2023/1114.
• Notifies Latvijas Banka of any changes in the information and documents submitted for obtaining authorisation.
• Notifies Latvijas Banka of any changes in the procedure for providing services.
• Notifies Latvijas Banka of significant incidents in the process of providing services.
• Becomes acquainted with the curator designated by Latvijas Banka.

What does Latvijas Banka do

• Designates the curator of the company.
• Assesses compliance of the company's operation with the requirements of legal acts.
• Requests additional information on the operation and performance indicators of the company.
• Examines the reports submitted and supervisory information.

What additional actions should the entrepreneur take

• In case of uncertainties, contact the curator designated by Latvijas Banka.
• Submit reports and the requested supervisory information on a regular basis.
• Notify of any changes in the process of service provision as well as of changes in the information and documents submitted to receive authorisation, including in the case of any changes in the structure of officials or shareholders.

Costs

No additional costs associated with the provision of supervision are involved during the supervision stage.

I White paper

1) The credit institution produces a crypto-asset white paper on the asset-referenced token pursuant to the requirements stipulated in Article 19 of Regulation (EU) 2023/1114 and the regulatory technical standards (RTS; the RTS draft versions are available here).

2) The credit institution submits the produced white paper to Latvijas Banka for approval as per the procedure laid down in the RTS (the RTS draft versions are available here); the crypto-asset white paper must be approved by Latvijas Banka before its publication.

II Prior to the first issue of an asset-referenced token, the credit institution submits the following information to Latvijas Banka:

1) a programme of operations which sets out the business model that the credit institution intends to follow;

2) a legal opinion that the asset-referenced token does not qualify as a crypto-asset excluded from the scope of Regulation (EU) 2023/1114 pursuant to Article 2(4) or an e-money token;

3) a detailed description of the governance arrangements referred to in Article 34(1) of Regulation (EU) 2023/1114;

4) a description of the internal control mechanisms and procedures of the specific crypto-asset service providers to ensure compliance with obligations in relation to the prevention of money laundering and terrorism and proliferation financing under Directive (EU) 2015/849 (this applies where cooperation arrangements with specific crypto-asset service providers exist);

5) the policies and procedures referred to in Article 34(5), first subparagraph, of Regulation (EU) 2023/1114;

6) a description of the contractual arrangements with third-party entities referred to in Article 34(5) of Regulation (EU) 2023/1114;

7) a description of the business continuity policy referred to in Article 34(9) of Regulation (EU) 2023/1114, including effective plans for emergency situations as well as a description of the procedure for regularly checking and reviewing the suitability and efficiency of these plans;

8) a description of the internal control mechanisms and risk management procedures referred to in Article 34(10) of Regulation (EU) 2023/1114;

9) a description of the systems and procedures in place to safeguard the availability, authenticity, integrity and confidentiality of data referred to in Article 34(11) of Regulation (EU) 2023/1114.

Articles 16, 18, 20, 21, 24, 35, 41, and 42 of Regulation (EU) 2023/1114 do not apply to the credit institutions issuing asset-referenced tokens, including significant asset-referenced tokens.

A credit institution that has previously notified Latvijas Banka of an issue of another asset-referenced token in accordance with Section II is not required to provide information that has already been submitted and has not changed. By submitting the required information, the credit institution confirms that the previously submitted information remains applicable.

Review deadline for the notification

At least 90 working days before initially providing the aforementioned services, the credit institution submits the information referred to in Sections I and II to Latvijas Banka.

Within 20 working days of receiving the notification, Latvijas Banka assesses whether all required information has been submitted. Should it find that the notification is incomplete, Latvijas Banka notifies the applicant of this and sets a deadline for submitting the missing information.

The review deadline for the notification may be extended for objective reasons if the information provided in the application is insufficient to take a decision.

Costs

A person (other than a financial market participant supervised by Latvijas Banka) that intends to offer an asset-referenced token to the public or seek its admission to trading, pays Latvijas Banka 2500 euro for the review of the application.

A financial market participant supervised by Latvijas Banka, including an issuer that has already obtained authorisation to offer an asset-referenced token to the public or seek its admission to trading, pays Latvijas Banka 1200 euro for the review of each additional asset-referenced token application, with the total annual payments, regardless of the number of applications, not exceeding 5000 euro per year.