The judgment of the Supreme Court of Berlin, which found that cryptocurrencies are no units of account within the meaning defined for regulatory purposes, shook up the German cryptocurrency scene. The first Bitcoin ATMs have been installed and many startups are planning to establish companies providing the trade with cryptocurrencies. However, in many cases these companies are confronted with an unexpected obstacle: the registration court.
Verification of authorization requirements necessary
The German local courts are legally obliged to only register companies requiring an authorization from the German Federal Financial Supervisory Authority (BaFin) if this authorization is already existing. In many cases, the registration court will consult either BaFin or the German Central Bank to clarify this point. As, according to BaFin’s opinion, the commercial trade in cryptocurrencies requires a BaFin authorization, hopeful companies may run the risk of being denied registration with the commercial register.
Registration courts hold different legal positions
However, the registration court must not simply rely on information provided by BaFin. Rather, it is obliged to check the actual circumstances and the legal assessment with respect to the authorization requirements. Hence, the registration court could either come to the same conclusion as the Supreme Court of Berlin, i.e. that the trade in cryptocurrencies is not subject to authorization, or follow the BaFin’s legal position.
As every registration court is free to follow its own legal position, a division of German registration practice into two or several different ones cannot be excluded. Emerging crypto entrepreneurs may be well advised to file for registration with a favorable court.
Founding crypto companies in accordance with legal requirements
If you intend to found your own company in the cryptocurrency sector, we will be very pleased to assist you in dealing with any pitfalls relating to registration courts. Our experienced attorneys at law assist you from the startup phase and provide advice and support allowing your company to gain a secure foothold.
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