Guidelines on templates for explanations and legal opinions and the standardized test for crypto-assets under Article 97(1) of Regulation (EU) 2023/1114

JC 2024 28
10 December 2024
Guidelines on templates for explanations and legal opinions and the standardized test for crypto-assets under Article 97(1) of Regulation (EU) 2023/1114

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114

1. Compliance and reporting obligations
   Status of these Guidelines
2. These Guidelines are issued in accordance with Article 16 of Regulation (EU) No 1093/2010, Regulation (EU) No 1094/2010 and Regulation (EU) No 1095/2010 (the European Supervisory Authorities Regulations)1. In accordance with Article 16(3) of the relevant European Supervisory Authorities Regulations, competent authorities and financial institutions must make efforts to comply with these Guidelines.
3. Competent authorities defined in Article 3(1)(35)(a) of Regulation (EU) 2023/11142 (MiCAR Regulation) to which these Guidelines apply should comply with them by incorporating them appropriately into their practices (e.g., by amending their legal framework or supervisory procedures), among other things in cases where the Guidelines are primarily directed at financial market participants and financial institutions.
   Reporting requirements
4. Within two months of the publication of these Guidelines on the websites of the European Supervisory Authorities in the official languages of the EU, in accordance with Article 16(3) of each regulation referred to in paragraph 1 of these Guidelines, competent authorities must notify the EBA, EIOPA or ESMA, as appropriate, whether they comply or intend to comply with these Guidelines or state reasons for non-compliance. In the absence of such notification within that period, the relevant European Supervisory Authority shall consider that the competent authorities are not compliant. Notifications are submitted by sending the completed form available on the websites of all European Supervisory Authorities with the reference “JC 2024 28”. Notifications should be sent by persons with appropriate authority to report on compliance on behalf of their competent authorities. Any change in compliance status must also be reported to the relevant European Supervisory Authorities.
5. Notifications will be published on the websites of each European Supervisory Authority in accordance with Article 16(3) of the relevant European Supervisory Authorities Regulations.
6. Financial market participants are not required to report on whether they comply with these Guidelines.

1 EBA – Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12) EIOPA – Regulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/79/EC (OJ L 331, 15.12.2010, p. 48.) ESMA – Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC (OJ L 331, 15.12.2010, p. 84.) 2 Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets, amending Regulations (EU) No 1093/2010 and (EU) No 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937 (OJ L 150, 9.6.2023, p. 40.).

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
2. Subject matter, scope and definitions
Subject matter
6. In accordance with Article 97(1) of Regulation (EU) 2023/1114, these Joint Guidelines establish the following:
a. the content and format of the explanation and legal opinion referred to in Article 8(4) and Article 17(1)(b)(ii) or Article 18(2)(e) of the Regulation; b. a common approach for the regulatory classification of crypto-assets under that Regulation.
Scope and addressees
7. These Guidelines are addressed to the competent authorities as defined in Article 3(1)(35)(a) of Regulation (EU) 2023/1114.
8. These Guidelines also apply3 to:
a. issuers, persons seeking listing for trading or trading platform operators for crypto-assets that do not represent asset-referenced tokens (ART) or e-money tokens (EMT), who are required to submit a crypto-asset white paper to the competent authority, together with an explanation describing why the crypto-asset should not be considered excluded from the scope of that Regulation or classified as ART or EMT in accordance with Article 8(4) of that Regulation; b. credit institutions intending to offer to the public or seek listing for trading of asset-referenced tokens which are required to submit a legal opinion on the qualification of crypto-assets to the competent authority in accordance with Article 17(1)(b)(ii) of Regulation (EU) 2023/1114;
c. legal persons or other entities that are not credit institutions intending to offer to the public or seek listing for trading of asset-referenced tokens which are required to submit a legal opinion on the qualification of crypto-assets to the competent authority in accordance with Article 18(2)(e) of Regulation (EU) 2023/1114.
9. These Guidelines also apply to persons intending to provide or perform services related to crypto-assets when assessing whether activities fall within the scope of their existing or planned authorizations for a specific type of crypto-assets under the scope of that Regulation.

3 The start date for the application of the MiCAR Regulation is determined by its Article 149 (entry into force and application), which should be interpreted in accordance with Article 143 (transitional measures).

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114 Definitions
10. Unless otherwise specified, terms defined and used in Regulation (EU) 2022/2554 have the same meaning in these Guidelines.

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
3. Implementation
Date of application
11. These Guidelines apply from 12.05.2025.

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
4. Templates and standardized test
Template for the purposes of Article 8(4) of Regulation (EU) 2023/1114
12. Issuers, persons seeking listing for trading and trading platform operators for crypto-assets that do not represent asset-referenced tokens and e-money tokens (relevant persons) should use the template in Annex A for the explanation referred to in Article 8(4) of Regulation (EU) 2023/1114.
13. All fields listed in the template should be filled with all necessary information for a clear, fair, non-misleading and complete explanation of the classification of crypto-assets. The following information should be provided in the crypto-asset classification explanation:
a. the source of definitions taken into account for each regulatory product listed in the template, including applicable EU law and national law; b. where relevant:
i. case law of the Court of Justice of the European Union and national courts;
ii. regulatory measures, including rules and guidelines, in the Member State concerned;
iii. interpretative guidelines of the European Commission and guidelines of the European Supervisory Authorities;
iv. interpretative guidelines of competent authorities or any other source relevant for the interpretation of regulatory terms.
Template for the purposes of Article 17(1)(b)(ii) and Article 18(2)(e) of Regulation (EU) 2023/1114
14. Credit institutions and legal persons and other entities intending to offer to the public asset-referenced tokens or seek listing for trading thereof should use the template in Annex B for the legal opinion on the qualification of crypto-assets referred to in Article 17(1)(b)(ii) and Article 18(2)(e) of Regulation (EU) 2023/1114.
15. All fields listed in the template should be filled with information necessary to provide a clear, fair, non-misleading and complete explanation of the classification of crypto-assets. The following information should be provided in the crypto-asset classification explanation:
a. the source of definitions taken into account for each regulatory product listed in the template, including applicable EU law and national law; b. where relevant:
i. case law of the Court of Justice of the European Union and national courts;
ii. regulatory measures, including rules and guidelines, in the Member State concerned;
iii. interpretative guidelines of the European Commission and guidelines of the European Supervisory Authorities;
iv. interpretative guidelines of competent authorities or any other source relevant for the interpretation of regulatory terms.
16. The template should be completed by an internal or external legal advisor. The legal advisor should be able to issue an opinion in an objective manner, without conflicts of interest that cannot be effectively managed. Evidence of the legal advisor's ability to issue a legal opinion within the framework of professional practice must be provided. This may include, as appropriate, a diploma, certificate of practice or registration with the relevant professional body in the Member State concerned.
Standardized test for the classification of crypto-assets
17. Competent authorities and other persons to whom these Guidelines are addressed should apply a common approach to determine the classification of crypto-assets on an individual basis, taking into account all attributes of the relevant token in accordance with the flowchart in Annex C.
18. Competent authorities and other persons to whom these Guidelines are addressed should determine whether there is a digital representation of value or rights, which are necessary attributes of crypto-assets as defined in Article 3(1)(5) of Regulation (EU) 2023/1114. The terms “value” and “rights” should be interpreted broadly in accordance with Recital 2 of that Regulation. Crypto-assets without intrinsic value but with value assigned by the seller/buyer or market participants4 should be considered a digital representation of value.
19. Competent authorities and other persons to whom these Guidelines are addressed should also assess whether the digital representation of value and/or rights can be transferred and stored electronically, using distributed ledger technology (DLT) or similar technologies. A token can only be considered “non-transferable” if at least the following conditions are met: i. if the token was accepted only by the issuer or offeror and ii. there is no technical possibility for the holder to transfer the token to other persons except the issuer or offeror (Recital 17 of Regulation (EU) 2023/1114). To assess whether a technology is similar to DLT, the functional characteristics of such technology should be taken into account, including the basis on which the record is kept (ledger), how it is exchanged and how consensus is achieved (i.e. the functioning of the consensus mechanism).
20. If both elements (digital representation of value and/or rights and transferable and stored electronically using DLT or similar technology) are satisfied to the satisfaction of competent authorities and other persons to whom these Guidelines are addressed, the token should be considered to comply with the definition of crypto-assets for the purposes of Regulation (EU) 2023/1114.

4 For example, tokens such as bitcoin and so-called “meme coins” traded on exchanges at public prices.

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
21. To determine whether crypto-assets are within the scope of Regulation (EU) 2023/1114, competent authorities and other persons to whom these Guidelines are addressed should assess all exclusions established in Article 2(2) to (4) of Regulation (EU) 2023/1114 as follows:
a. Article 2(2): Is the issuer or offeror a person to whom that paragraph applies? The MiCAR Regulation does not apply to persons providing services related to crypto-assets exclusively for their parent companies, their own subsidiaries or other subsidiaries of their parent companies, liquidators or administrators acting within the framework of insolvency proceedings (except for the purposes of Article 47 of MiCAR), the ECB, central banks of Member States when acting in their capacity as monetary authorities or other public authorities of Member States, the European Investment Bank and its subsidiaries, the European Financial Stability Facility and the European Stability Mechanism and public international organizations. b. Article 2(3): Is the crypto-asset unique and non-fungible with other crypto-assets?5 When assessing whether a crypto-asset is unique and non-fungible, competent authorities and other persons to whom these Guidelines apply should take into account Article 2(3) and Recital 11 of Regulation (EU) 2023/1114 and the Guidelines on conditions and criteria for qualifying crypto-assets as financial instruments.6
c. Article 2(4): Is the crypto-asset considered a relevant product listed in that paragraph? Regulation (EU) 2023/1114 does not apply to financial instruments, deposits, structured deposits, money (except e-money tokens), securitisation positions (under Regulation (EU) 2017/2402)7, insurance products and reinsurance contracts (in accordance with Directive 2009/138/EC), pension products primarily providing pension income, officially recognised occupational pension schemes (in accordance with Directives (EU) 2016/23418 and 2009/138/EC)9, individual pension products mandatory for the employer, pan-European personal pension products (in accordance with Regulation (EU) 2019/1238) 10 and social security systems (under Regulations (EC) No 883/200411 and (EC) No 987/2009)12.

5 This may include, for example, non-fungible crypto-assets that prove exclusive ownership rights over specific tangible assets in real estate (such as a house or commercial property) or intangible assets such as a patent.
6 A link will be added once ESMA's Guidelines become final (for the consultative document see ESMA75 – 453128700 – 52).
7 Regulation (EU) 2017/2402 of the European Parliament and of the Council of 12 December 2017 laying down a general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation, and amending Directives 2009/65/EC, 2009/138/EC and 2011/61/EU and Regulations (EC) No 1060/2009 and (EU) No 648/2012 (OJ L 347, 28.12.2017, p. 35) 8 Directive (EU) 2016/2341 of the European Parliament and of the Council of 14 December 2016 on the activities and supervision of institutions for occupational retirement provision (OJ L 354, 23.12.2016, p. 37.) 9 Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1) 10 Regulation (EU) 2019/1238 of the European Parliament and of the Council of 20 June 2019 on a pan-European personal pension product (PEPP) (OJ L 198, 25.7.2019, p. 1) 11 Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems (OJ L 166, 30.4.2004, p. 1) 12 Regulation (EC) No 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation (EC) No 883/2004 on the coordination of social security systems (OJ L 284, 30.10.2009, p. 1)

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
22. Without prejudice to other relevant materials, the information in paragraph 13 of these Guidelines should be taken into account for the purpose of assessing whether crypto-assets are:
a. financial instruments, competent authorities and other persons to whom these Guidelines are addressed should apply the guidelines issued by the European Securities and Markets Authority in accordance with Article 2(5) of Regulation (EU) 2023/111413; b. deposits, competent authorities and other persons to whom these Guidelines are addressed should refer to the EBA Opinion and Report of 2014 and the Opinion on the scope of credit institutions of 2020, which provide indications on the concept of “deposit”14 and the EBA Report on structured deposits of 2024.15;
c. insurance products or insurance contracts, competent authorities and other persons to whom these Guidelines are addressed should take into account that there is no explicit definition of insurance at EU level, neither as an activity nor as a contract.16
23. If no exclusions from paragraph 22 apply, competent authorities and other persons to whom these Guidelines are addressed should assess the characteristics of crypto-assets to determine whether the crypto-assets represent e-money tokens, asset-referenced tokens or other crypto-assets under Regulation (EU) 2023/1114 and should take into account the following:
a. Does the crypto-asset intend to maintain a stable value by referring only to the value of one official currency? If the answer is yes, it is classified as an e-money token in accordance with Chapter IV of Regulation (EU) 2023/1114. b. If the crypto-asset does not have the purpose of maintaining a stable value by referring only to the value of one official currency, does it intend to maintain a stable value by referring to another value or right (or a combination thereof), including one or more official currencies? If the answer is yes, it should be classified as an asset-referenced token in accordance with Chapter III of Regulation (EU) 2023/1114.
c. If the crypto-asset does not intend to maintain a stable value by linking to another value or right (and therefore is not an asset-referenced token or e-money token), it is classified as crypto-assets in accordance with Chapter II of Regulation (EU) 2023/1114.

13 A link will be added once ESMA's Guidelines become final (for the consultative document see ESMA75 – 453128700 – 52).
14 EBA Opinion and Report of 2014 on the scope of credit institutions: https://www.eba.europa.eu/publications-andmedia/press-releases/eba-publishes-opinion-perimeter-credit-institutions and EBA Opinion of 2020: https://www.eba.europa.eu/sites/default/files/document_library/Publications/Opinions/2020/931784/EBA%20Opinion%2 0on%20elements%20of%20the%20definition%20of%20credit%20institution.pdf 15 EBA Report 2024 on structured deposits: https://www.eba.europa.eu/sites/default/files/2024-07/b807c1a8- 6f1d-4c2b-b2a0-2cdcb7737282/Report%20on%20structured%20deposits.pdf 16 Final report of the Commission Expert Group on European Contract Law in the field of insurance European Commission, 2014, p. 38 and following

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114
Annex A – Template
This template is submitted for the purposes of the explanation referred to in Article 8(4) of Regulation (EU) 2023/1114.

FINAL REPORT ON GUIDELINES UNDER ARTICLE 97 OF REGULATION (EU) 2023/1114 FORM: EXPLANATION FOR THE PURPOSES OF ARTICLE 8(4) OF REGULATION (EU) 2023/1114 The explanation prepared for the purposes of Article 8(4) of Regulation (EU) 2023/1114 (MiCAR) should contain information for each of the following fields. Information about the explanation Date of issue of this explanation Name of the person (legal or natural) issuing this explanation Provide name, address, email address and telephone number. Contact details (legal or natural) of the person issuing this explanation (if different from the above) Provide name, address, email address and telephone number. Confirmation that this explanation is issued for the purposes of Article 8(4) of MiCAR Please confirm. Information about issuers, persons seeking listing for trading and/or trading platform operators Name of the issuer or person seeking listing for trading or trading platform operator on whose behalf this explanation is issued To provide this information, use the Appendix to this template. White paper to which this explanation refers (this should be the “final version” of the white paper submitted for the purposes of Article 8(1) of MiCAR) Provide the date of the white paper for which notification was submitted for the purposes of Article 8(1) of MiCAR and which was assessed for the purposes of this explanation and to which this explanation refers. Attach a copy of the white paper to this explanation. Member States in which the public offer or listing for trading will take place Crypto-assets Applicable law Specify the law applicable to the crypto-assets as stated in the white paper. Executive summary of the regulatory classification of crypto-assets Specify the proposed regulatory classification and any key points you wish to highlight in the executive summary. Detailed explanation that the digital representation referred to in the white paper is crypto-assets within the meaning of Article 3(1)(5) of MiCAR The explanation can be provided in the Appendix and should cover all aspects of the definition of “crypto-assets”, including the value or right it represents, and the distributed ledger technology or similar technology to which the crypto-assets can be transferred or stored. Detailed explanation that the crypto-assets referred to in the white paper are not e-money tokens within the meaning of Article 3(1)(7) of MiCAR The explanation can be provided in the appendix and should include all aspects demonstrating that the crypto-assets are not intended to maintain a stable value by referring to an official currency, with full cross-references to relevant provisions of the white paper. Detailed explanation that the crypto-assets referred to in the white paper are not asset-referenced tokens within the meaning of Article 3(1)(6) of MiCAR The explanation can be provided in the appendix and should include all aspects demonstrating that the crypto-assets are not intended to be directed at maintaining a
stable value by referring to another value or right or their combination, with full cross-references to relevant provisions of the white paper. Detailed explanation that the crypto-assets do not represent any of the following:

• financial instrument, as listed in Article 2(4)(a) of MiCAR
  Source of definition (as appropriate, EU law and/or national law):
  Case law (including references to paragraphs, as appropriate) referred to in the explanation:
  Regulatory measures or guidelines referred to in the explanation (including guidelines adopted under Article 2(5) of MiCAR):
  Reasoning:
  Note: The explanation can be supplemented in the Appendix and should include all aspects demonstrating that the crypto-assets are not a financial instrument. The explanation should state why the crypto-assets do not correspond to any type of financial instrument (transferable securities, money market instruments, etc.), provide full reference to ESMA's guidelines under Article 2(5) of MiCAR and all relevant case law or relevant regulatory or supervisory materials issued by the competent authority for the purposes of [MiFID II] in the home Member State within the meaning of Article 3(1)(33) of MiCAR.
• deposit, including structured deposits, as listed in Article 2(4)(b) of MiCAR
  Source of definition (as appropriate, EU law and/or national law):
  Case law (including references to paragraphs, as appropriate) referred to in the explanation:
  Regulatory measures or guidelines referred to in the explanation:
  Reasoning:
  Note: The explanation should include all aspects demonstrating that the crypto-assets are not a deposit. The explanation should fully refer to any relevant case law or relevant regulatory or supervisory materials issued by the competent authority for the purposes of [CRD/CRR] in the home Member State in