On June 3, 2020, the Autorité de Contrôle Prudentiel et de Résolution ("ACPR") and the New York State Department of Financial Services ("NYSDFS") have announced their conclusion of a Memorandum of Understanding (MoU) to enhance international cooperation on FinTechs. With this MoU, these Authorities want to provide "greater support to Fintech companies (...) providing entrepreneurs speed to market opportunities in New York and France, while upholding robust consumer protection". It includes in particular a referral mechanism to facilitate the preparation of the authorization that may be needed for operators offering services in one of the jurisdictions using innovative financial technologies and wishing to develop their activities in the other jurisdiction.
This MoU is concluded between:
- the French prudential authority for the banking, financial and insurance sector; and
- the American authority for the supervision and oversight of banking, financial and insurance actors fo the State of New York.
It entered into force on the date of its conclusion.
Its objective is to support innovation in the financial sector and the activity of FinTechs in France and New York and to strengthen the effectiveness of supervision in this area.
To this end, the MoU provides in particular for a referral mechanism between theses authorities for the benefit of FinTechs wishing to benefit from it. This mechanism is intended to facilitate the preparation of the authorization that may be needed for any actor offering services in one of the jurisdictions using innovative financial technologies and wishing to develop its activities in the other jurisdiction.
The mechanism includes in particular:
- the designation by the host authority of a dedicated contact person for the FinTech involved, particularly to understand the legal framework that is applicable in the host authority's jurisdiction;
- an exchange of information on the FinTech involved between authorities; and
- specific assistance and support during the application process that the FinTech involved may need to follow to be authorized by the host authority, in particular by allocating the appropriate resources within the host authority to understand the activities of the actor involved and the related stakes.
The MoU specifies that the confidential information on the FinTechs covered by the MoU may only be shared with their consent and that it would remain governed by the regulatory provisions applicable to both authorities in their respective jurisdiction.
This innovative MoU intends to "facilitate the increase of cross-border business and investment opportunities in the two markets". The two authorities undertake to provide "greater support to Fintech companies in France and the State of New York to help them better understand the regulations in each jurisdiction". The challenge clearly stated by the authorities is to ensure "entrepreneurs speed to market opportunities in New York and France, while upholding robust consumer protection". (ACPR Press Release, June 3, 2020)
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