SADC PF shines the spotlight on cryptocurrencies
Existing legal and regulatory gaps in current systems of managing public finances in SADC member states have inspired the region’s Parliamentary Forum to ignite dialogue for cryptocurrencies. As the region seeks to conclude a Model Law on Public Finance Management ( PFM) soon, provisions intended to guide member countries in dealing with cryptocurrencies have been dovetailed into the new legal instrument. Boemo Sekgoma, SADC PF SecretaryGeneral said the document is a concerted effort by a legal drafter and members of the SADC Parliamentary Forum Technical Working Groups and is the first such legal instrument in the world. Commenting on cryptocurrencies, Legal Drafter of the Model Law on PFM, Daniel Greenberg said the administration and supervision benchmark tool could not be complete without touching on cryptocurrencies.
“The role of cryptocurrencies is changing every second, we can say nothing about it,” Greenberg said, emphasising that SADC countries should integrate cryptocurrencies into public finance management. The Model Law proposes regulatory principles to create a transparent and verifiable regulatory framework for the future development of the cryptocurrency sector. According to Greenberg, the regulatory crypto- currency principles should be constructive engagement for an orderly integration of crypto- assets into existing financial arrangements and classification to identify the financial or other regulatory regimes under which different crypto- assets should be subject to regulation, and the use of cryptocurrencies as legal tender. In addition, the Model Law advocates for consumer and investor protection in dealing with cryptocurrencies. “The regulation of crypto- assetrelated activities should be subject to the principles of conducting any financial business, including general principles of integrity, financial prudence, orderly market conduct, transparency, protection of clients’ assets, and avoidance of conflict of interest,” Greenberg said. He said regulation should be determined by reference to the functions of crypto- currencies rather than the underlying technology. The legal drafter said regulation of crypto- currencies and related activities should be transparent, stable, and predictable to avoid regulatory uncertainty unduly deterring orderly integration of the sector into mainstream financial regulation.
Meanwhile, the Director of the Parliamentary Budget Office in Zimbabwe, Pepukai Chivore said the SADC member countries should now embrace the fourth industrial revolution and leverage technologies to modernise tax collection system, deepening regional integration and tax coordination in order to broaden the tax base.