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CMS Monaco:

What are the consequences

of the new rules on financial

canvassing

The New Regulation makes a clear
distinction between the regime applicable

to canvassing activities carried out in the
Principality and those carried out remotely.
Olivier Marquet - Managing Partner and
Marine Tarditi - Senior Associate of the CMS
Monaco law firm explain the consequences
of this change. Marine Tarditi, Senior Associate

The new law n 1.529 of 29 uly 2022, Exceptions to the prohibition principle are which would be carried out remotely when
resulting from the bill n 1.049, containing however made in the second paragraph the act is solicited, and when the target is
various economic and legal provisions (the of the article with regard to institutional already a client.
“ ew Regulation”) offers new opportunities investors; approved companies; or clients Article 29-1 prohibits any unsolicited
to foreign companies that are not regulated of an authorized company when the approach carried out remotely, with a view
in Monaco by amending the Financial procedures are carried out through its to offering financial services, instruments
Activities Act o. 1.338. It puts an end to intermediary. or products to persons domiciled in the
the difficulties of interpretation of the law n This legislative evolution appears legitimate Principality. A reading a contrario of these
1.515 of 23 December 2021 (the “Previous with regard to sophisticated targets and provisions allows to deduce that, as soon as
aw”) which had quite radically blocked the seems to take up the idea of a categorization the canvassing act has been solicited by a
access, for foreign unregulated companies, of clients (such as the MiFID Directive does prospect, an unauthorized foreign person
to the Monegasque clients. in Europe but without going so far as to entity will be able to offer its financial
adopt the classification). services, instruments or products to them,
Canvassing on the territory of the In parallel, the ew Regulation provides provided that the proposal is carried out
Principality, a principle of prohibition flexibility for canvassing acts carried out at a distance. The egislator is adopting
subject to exceptions with regard to professionals of the banking here a reversal of position which suggests
While the initial prohibition principle sector by authorizing events organized on a much more flexible regulation, in line
remains, it is now subject to exceptions the territory of the Principality bringing with most of our neighboring countries.
for sophisticated targets. them together, subject to prior notification The sovereign ordinance that will complete
According to paragraph 1 of article 29 of the Commission de Contr le des Activit s the ew Regulation will have to specify the
of Act o. 1.338 (as amended by the Financi res (Financial Activities Control contours of reverse solicitation.
ew Regulation), solicited or unsolicited Commission) and unless the latter gives As an exception, the prohibition set forth in
approaches to offer financial services, an unfavorable opinion. The permission Article 29-1 does not apply when the person
instruments or products to persons of such events for unlicensed actors goes domiciled in Monaco is already a client of
domiciled in the Principality, which would further than what was foreseen in the the non-authorized person or entity.
be carried out by any entity not authorized report of the bill 1.049. The question of In the spirit of the current negotiations on
under the Act o. 1.338, are prohibited in the organization of this type of event had an association agreement between Monaco
the territory of the Principality. not arisen for unlicensed actors. In the end and the European Union, the egislator
First of all, it should be noted that the the ew Regulation has decided differently. is taking a step forward by adopting
prohibition under the ew Regulation concepts already endorsed by our European
is extended to “any person or entity not Distance selling, a reversal of position neighbors and by opening the Monegasque
licensed”, thus closing the door to any enshrined in law financial market, while protecting its less
legal structure or any natural person not The ew Regulation validates, under its sophisticated citizens.
licensed in the Principality. new article 29-1, any act of canvassing

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