Crypto Firms Win Legal Battle in Netherlands Over Registration Fees

Dutch cryptocurrency companies, including Bitvavo and Coinmerce, have achieved a partial victory in their legal battle against fees totaling $2.3 million imposed by Dutch regulators.

The Rotterdam court ruled that the Dutch Central Bank (DNB) exceeded its legal authority by charging these crypto companies for registration related to anti-money laundering requirements. The court found that these fees violated European Union law, signalling potential implications for cryptocurrency regulation in the Netherlands.

The court specifically noted that the DNB’s assessment of registration requests from crypto service providers went beyond the legal scope defined by EU anti-money laundering laws. The court declared it unlawful to charge supervisory costs to these companies for the year 2021.

However, the ruling does not affect the fees imposed for the year 2020, and a separate legal case is ongoing for 2022 fees.

The Netherlands has maintained a strict stance on regulating cryptocurrency firms, leading to substantial fines imposed on major exchanges like Coinbase and Binance for their failure to register with Dutch authorities.

These stringent regulations have prompted some players, such as the Gemini exchange, to exit the Dutch market. Binance transferred its Dutch customer base to Coinmerce as part of its compliance efforts.

The legal victory for Dutch crypto firms reflects the ongoing debate over operational costs and supervisory fees for cryptocurrency companies.

Financial regulation in Europe typically involves supervisory bodies funding their operations through fees charged to the entities they oversee, based on their size and complexity. In this case, crypto supervisory fees in 2022 amounted to €2.2 million ($2.3 million), with the amount tending to increase annually.

Patrick van der Meijde, the President of the United Bitcoin Companies of the Netherlands, expressed satisfaction with the court’s decision, emphasising that the court recognized a violation of the registration obligation outlined in EU anti-money laundering legislation in the Netherlands.

Van der Meijde stressed that the substantial costs associated with these fees should not have been passed on to crypto companies, as they were deemed to be beyond the DNB’s mandate.

Despite the court ruling, the DNB emphasised that taxpayers should not bear the substantial costs associated with supervising the crypto sector, as this falls outside the scope of their mandate.

A spokesperson for the DNB acknowledged the ruling and stated their intention to consult further with the finance ministry on the issue. The DNB reiterated its commitment to providing adequate money-laundering supervision of the crypto sector, as well as other financial institutions.

The Netherlands, known for its strict fines and regulatory hurdles on crypto firms, has witnessed major players like Coinbase, Binance, and Gemini navigating the complex regulatory landscape.

The court’s decision is seen as a significant development in the ongoing dialogue between cryptocurrency companies and regulators in the country, providing insights into the evolving regulatory framework for the crypto industry in the Netherlands.

* Original content written by Coinlive. Coinbold is licensed to distribute this content by Coinlive.

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