Governments and tax authorities are scrambling to keep pace with the increasing digitisation of the global economy and public outcry over the levels of corporate tax being paid by large multinational enterprises.
Since it was first identified in the city of Wuhan (China), the COVID-19 coronavirus has infected over 121,000 people, killing over 4,000 patients. While medical scientists work 24/7 to find a vaccine, Artificial Intelligence (AI) researchers have joined the global effort to defeat the virus.
Parliamentary Secretary for Financial Services, Digital Economy and Innovation Silvio Schembri has announced the launch of a cybersecurity scheme, aimed at instilling a cyber security mentality in the private industry. The B Secure Scheme is a government investment of €250,000 to allow companies to ramp up their cyber security initiatives. A survey carried out by MITA, has shown how only 35% of SMEs provide cyber security training to their employees and 80% are interested in providing such training. Cybercrime is a real and present threat for all Maltese businesses.
Malta was the first country to enact a comprehensive regulatory framework to cater for ICOs. This move to regulate initial coin offerings inspired other regulators around the world to move to regulate the space themselves.
We all heard about “big data”; which is incomprehensibly large data generated by real people. To give you an idea of scale; 90% of all data was created in the last 2 years, and we currently generate c. 2.5 quintillion bytes of data a day.
On 25 January the Malta Financial Services Authority issued an update on the Virtual Financial Assets Framework to update the public on the progress of the implementation of the regulatory framework.
The Malta Financial Services Authority has recently launched a consultation paper highlighting its vision for the coming years. Labelled as MFSA's Vision 2021 it outlines the authority’s aim to strengthen its processes and paving the way for the future of the financial services industry. Concurrently, the MFSA also launched a consultation document on the MFSA's FinTech strategy, proposing the introduction of a regulatory sandbox and innovation hub.
Progress in finance has facilitated the exchange of value to an automated process, but behind the scenes it has been a centuries’ long process to get where we are today.
Many predict that DLT is reinventing and transforming key industries and creating new business models, making every transaction transparent, democratic, decentralized, efficient and secure. The belief in blockchain’s potential is so widespread that financial and tech entities have invested an estimate of $1.4 billion in 2016, which is expected to go up to $2.1 billion in 2018.
AI has slowly been working its way into businesses. Business Intelligence (BI) systems generate and automatically process a wealth of digital data providing the necessary metrics to efficiently run an organization. Machine learning and AI solutions have the potential to further crunch such data creating unprecedented opportunities for improvement across health, lifestyle, transportation, education and practically every human activity.
Malta plans to develop a National AI Strategy, putting the island amongst the top 10 nations that have taken such an approach to artificial intelligence . A key advantage of Malta is its size, making it similar to a cosmopolitan city that could allow companies to test their products in a real-life scenario.
No doubt that blockchain technology presents many opportunities that will keep transforming the financial space. The disruptive technology is exponentially opening up international markets the same way the internet transformed access to information. For those that recognize what blockchain technology has to offer, its potential has no barriers, both for entrepreneurs and consumers who will be able to gain access to any service or assets they need where they are and when they need them.
The Financial Intelligence Analysis Unit (FIAU) has published a document for consultation which covers the application of Anti-Money Laundering and Countering the Funding of Terrorism (AML/CFT) obligations by the Virtual Financial Assets (VFA) sector. The guidance notes will apply to VFA agents, VFA issuers and VFA licence holders.
The MFSA has published further material with regards to the Virtual Financial Assets Regulations. The rules place heavy emphasis on the level of competence that prospective VFA Agents are required to have, both in terms of the traditional financial services framework as well as the regulatory framework developed under the Virtual Financial Assets Act.
Commerce is increasingly digital. Yet, the global tax system is still geared to the needs of a traditional ‘bricks and mortar’ economy. The OECD’s Base Erosion and Profit Sharing (BEPS) Action Plan recognises the need for modernisation and has achieved quite a lot since the issue of its reports in October 2015. However, specific recommendations on digital taxation have been limited and the OECD’s calls for an international consensus on the way forward have so far been unheeded.
Cryptocurrency is digital or ‘virtual’ money, which uses cryptography to secure its transactions, to control the creation of additional currency units, and to verify the transfer of assets. Cryptography itself describes the process by which codes are written or generated to allow information to be kept secret.