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Fintech regulation in Liechtenstein – Lexology

Financial regulation

Regulatory bodies

Which bodies regulate the provision of fintech products and services?

The Financial Market Authority (FMA) is the supervisory authority in the fintech sector, as well as the Liechtenstein financial market in general. The FMA has an entire department solely dedicated to the fielding of fintech-related inquiries.

Regulated activities

Which activities trigger a licensing requirement in your jurisdiction?

As Liechtenstein is a member of the European Economic Area (EEA), general EU regulations and directives apply (with an EEA Joint Committee decision required). All banking activities (deposit and loan business), as well as investment services pursuant to Annex I of MiFID II are regulated. In addition, payment services pursuant to the EU Payment Services Directive (2015/2366/EC) (PSD2) and the EU E-money Directive (2009/110/EC) are regulated.

Consumer lending

Is consumer lending regulated in your jurisdiction?

Regulation of consumer lending depends on the concrete business model. Taking deposits (in legal tender) and lending this money to others (deposit and lending business) are considered to be banking activities, which are both reserved to licensed banking institutions. If a platform is operated which enables users to provide these kinds of activities to other participants, then this could be an illegal business model. However, it depends on the exact use case. In addition, if loans are given in the form of tokens (which represent either e-money or financial instruments), then the Banking Act is not applicable, as it deals with legal tender (fiat) only.

Secondary market loan trading

Are there restrictions on trading loans in the secondary market in your jurisdiction?

If obligations from a debtor to a creditor are traded (factoring), this will constitute a commercial business without the requirement for special financial licences. However, if loans (in the sense of a lending business) are traded (ie, a new creditor is entering the agreement), then this will likely constitute a banking business. This must be differentiated on a case-by-case basis.

Collective investment schemes

Describe the regulatory regime for collective investment schemes and whether fintech companies providing alternative finance products or services would fall within its scope.

The Liechtenstein Collective Investment Scheme (CIS) Regulation is mainly based on the EU Undertakings for the Collective Investment in Transferable Securities (UCITS) Directive (2009/65/EC) and the EU Alternative Investment Fund Managers Directive (2011/61/EU) (AIFMD) and is therefore harmonised within the European Union and the EEA.

An ‘alternative investment fund’ (AIF) is broadly defined as an undertaking collecting capital in order to invest it pursuant to a defined investment strategy on behalf of the investors.

A ‘UCITS’ refers to an undertaking which raises capital from the public and invests this capital collectively in specific transferable securities on the principle of risk spreading.

Alternative investment funds

Are managers of alternative investment funds regulated?

With funds, it is crucial to distinguish between the investment portfolio and the shares of the fund. Since a fund pursuant to the UCITS regime may invest only in specific types of financial product, a true crypto fund is not feasible pursuant to the EU UCITS Directive and only the shares of the fund may be tokenised. In that sense, a true crypto fund can only be achieved under the AIFMD, as this is primarily a fund-manager regulation, rather than an investment-fund regulation. An AIF mainly targets professional investors.

Hence, a fund pursuant to the AIFMD may invest in a crypto portfolio and its shares may be tokenised. A central aspect of an AIF is the pooling of capital or assets. These criteria must be broadly construed to mean any assets. Thus, a fund may be holding yachts in its portfolio or other commodities – such as tokens.

Peer-to-peer and marketplace lending

Describe any specific regulation of peer-to-peer or marketplace lending in your jurisdiction.

No specific regulation applies to peer-to-peer lending. EU legislation applies and it should be analysed if a banking business is conducted.


Describe any specific regulation of crowdfunding in your jurisdiction.

An EU directive on crowdfunding is due to be enacted in the future, which will affect Liechtenstein jurisprudence due to the country’s harmonisation with the European Union as an EEA member state. At present, an initial coin offering (ICO) or a token generation event may be regulated in Liechtenstein if security tokens are being issued. In general, there is no singular act specific to ICOs that regulates crowdfunding, but several laws may apply.

Moreover, although no specific act applies directly to ICOs, the passage of the Blockchain Act will directly apply to token generating events.

Invoice trading

Describe any specific regulation of invoice trading in your jurisdiction.

Factoring is not regulated as a financial market activity. Only a commercial business licence is required from the Office of Economic Affairs.

Payment services

Are payment services regulated in your jurisdiction?

The revised Liechtenstein Payment Service Act, which is based on PSD2, is due to enter into force on 1 October 2019. The E-money Act, which is based on the EU E-money Directive, is also relevant to payment services.

For a variety of business models, the application of PSD2 could trigger the need for a payment services licence.

Open banking

Are there any laws or regulations introduced to promote competition that require financial institutions to make customer or product data available to third parties?

PSD2 introduces the new roles of a payment initiation service provider and an account information provider. In this regard, banking institutions must – to a certain extent – make customer or product data available to third parties.

Insurance products

Do fintech companies that sell or market insurance products in your jurisdiction need to be regulated?

The Liechtenstein Insurance Act is based on the EU Insurance Distribution Directive (2016/97/EC) and the distribution of insurance products is a regulated activity.

Credit references

Are there any restrictions on providing credit references or credit information services in your jurisdiction?

Credit references and information services may constitute account information services pursuant to PSD2.

Law stated date

Correct on:

Give the date on which the above content is accurate.

12 July 2019.


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