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The Global Legal Monitor is an online publication from the Law Library of Congress covering legal news and developments worldwide. It is updated frequently and draws on information from official national legal publications and reliable press sources. You can find previous news by searching the Global Legal Monitor.

Germany: Court Holds That Bitcoin Trading Does Not Require a Banking License

(Oct. 19, 2018) On September 29, 2018, the Higher Regional Court of Berlin (Kammergericht Berlin, KG Berlin) held that trading in Bitcoin does not require a banking license because Bitcoin is not a financial instrument, in particular, not a unit of account, within the meaning of the German Banking Act. The defendant was therefore not conducting an illegal banking business punishable by imprisonment or a fine. The decision is directly at odds with the regulatory practice of the German Financial Supervisory Authority (BaFin), which classifies Bitcoin as a financial instrument and therefore makes commercial trading subject to authorization. (KG Berlin, Sept. 25, 2018, Docket No. (4) 161 Ss 28/18 (35/18), ECLI:DE:KG:2018:0925., Court Decisions of Berlin-Brandenburg website; Gesetz über das Kreditwesen [Kreditwesengesetz] [KWG] [Banking Act], Sept. 9, 1998, BUNDESGESETZBLATT [BGBl.] [FEDERAL LAW GAZETTE] I at 2776, as amended, German Laws Online website.)

Facts of the Case

The defendant operated an internet trading platform for Bitcoin and carried out principal brokerage services for sellers and buyers. Buyers had to register and put money in their accounts, with which they were able to purchase Bitcoin. Sellers offered their produced Bitcoin on the website. Payments of customers were made to an account of the B. and to a Polish account. In March 2013, a “Bitcoin hype” started and the defendant’s account balance increased from €209,832.16 (about US$242,089.36) to €2.45 million (about US$2.83 million) within a few days. On April 9, 2013, the Polish authorities froze his account because they suspected money laundering. The defendant hired an attorney who advised him to close the trading platform, which he did on April 11 and 12, 2013. (KG Berlin para. 3.)

He was subsequently criminally charged with negligently conducting a banking business without authorization, which is punishable by a term of imprisonment of up to three years or a fine, and sentenced to pay a fine. (Id. at 1; Banking Act § 54, para. 2.) He appealed the decision, and the Regional Court of Berlin (Landgericht Berlin) subsequently reversed the lower court’s decision, holding that Bitcoin trading was not subject to authorization and the defendant was therefore not criminally liable. The prosecution appealed the decision to the Higher Regional Court of Berlin. (KG Berlin para. 1.)

Legal Framework

Conducting banking business or providing financial services on a commercial basis or on a scale that requires commercially organized business operations in Germany requires authorization from BaFin. (Banking Act § 32, para. 1.) According to section 1 of the Banking Act, “conducting banking business” comprises, among other things, “the purchase and sale of financial instruments in the credit institution’s own name for the account of others (principal broking services).” (Id. § 1, para. 1, sentence 2, no. 4.) Section 1, paragraph 11 of the Banking Act contains an exhaustive list of financial instruments within the meaning of paragraph 1. Conducting banking business without authorization is punishable by a term of imprisonment of up to five years or a fine. (Id. § 54, para. 1.) If done negligently, the punishment is up to three years in prison or a fine. (Id. § 54, para. 2.)


The Higher Regional Court confirmed the decision of the Regional Court of Berlin. It held that the virtual currency Bitcoin is not a financial instrument within the meaning of the Banking Act, in particular, not a unit of account according to section 1, para. 11, no. 7, and therefore does not require authorization from BaFin. (KG Berlin, paras. 6 & 8.)

According to the Court, the explanatory memorandum to the amendment of the Banking Act, which added “unit of accounts” to the list of financial instruments in 1997, does not contain any hints that the legislature meant to include cryptocurrencies as units of account. On the one hand, Bitcoin was first mentioned on the Internet in 2008/2009 and therefore could not have been part of the considerations at the time. Secondly, the Court held that the wording is also not open to an interpretation that would allow including Bitcoin. (Id. at 12.)

The Court stated that Bitcoin is issued neither by a central bank nor by a public body, and there is no universal issuer. In addition there is no central and definable authority that can regulate Bitcoin. The Court added that Bitcoin is neither a currency nor a classical means of payment, although it is accepted as a means of payment by certain economic actors, and it is highly volatile. (Id. at 13.) The Court concluded that Bitcoin is therefore missing a continuing value and general recognition that units of account generally have. (Id. at 14.)

Furthermore, the Court ruled that BaFin overstepped their competency when it classified Bitcoin as “units of account” and therefore made them subject to authorization. (Id. at 15 & 17.) It stated that an administrative agency may not encroach upon the competencies of the legislature to amend criminal norms. (Id. at 16.)

Finally, the Court declared that Bitcoin is not e-money as defined in the Second European Union E-Money Directive as implemented into the German Payment Services Supervision Act. (Id. at 20; Zahlungsdiensteaufsichtsgesetz [ZAG] [Payment Services Supervision Act] July 17, 2017, BGBl. I at 2446, German Laws Online website.) It explained that Bitcoin was already known when the Second E-Money Directive was implemented into German law, but the legislature did not explicitly include it in the Banking Act or the Payment Services Supervision Act, and did not make commercial trading subject to authorization by the BaFin. (KG Berlin, para. 28.)

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Togo: Parliament Adopts Bill to Promote Power Generation from Clean Sources

(Oct. 15, 2018) On July 24, 2018, Togo’s Parliament adopted a bill to promote power generation from clean sources. (Ouverture de la deuxième session extraordinaire de l’année 2018 [2018’s Second Extraordinary Assembly], Assemblée Nationale Togolais [Togolese National Assembly] website (all translations by author).)

The bill was approved unanimously and includes 59 articles organized in seven titles aimed at “establishing a legal framework to promote the realization and operation of electrical installations for the production of renewable energy.” (Id.)

The adoption of this bill is in line with Togo’s plan to provide access to reliable, modern energy for all its citizens. Indeed, at the end of June 2018, Togo’s government launched a new national electrification strategy for the next 12 years, backed by major lenders, under which authorities plan to provide power to all Togolese by 2030. (Fiacre E. Kakpo, Marc Ably-Bidamon: “Togo’s Ambition Is to Provide Electricity to Its Whole Population by 2030,” TOGO FIRST (Aug. 8, 2018).)

Under Togo’s plan, 300 minisolar plants are to be established via private-public partnerships, and 550,000 households are to be provided with solar kits. (Énergie: le Togo a besoin de 180 milliards [Energy: Togo Needs 180 Billion Dollars], REPUBLIQUE TOGOLAISE (June 27, 2018).) The new bill, Togolese authorities believe, will greatly contribute to the concretization of these goals. (Fiacre E. Kakpo, Parliament Adopts Bill to Boost Clean Energy Production, TOGO FIRST (July 26, 2018).)

André Johnson, Togo’s Minister of Environment and Forest Resources, stated after the bill’s adoption that [t]oday’s vote will support the implementation of our energy strategy which is based, among others, on clean energy development, namely solar and hydropower, as well as on environmental protection, in line with the sustainable development goal 7 (SDG7). (Id.) The Sustainable Development Goals (SDGs) are a set of goals created by the United Nations for sustainable development and have been publicized as international goals. (G.A. Res. A/Res/70/1, Transforming Our World: the 2030 Agenda for Sustainable Development (Sept. 25, 2015), U.N. General Assembly website.) SDG7 aims at “ensuring access to affordable, reliable, sustainable and modern energy for all.” (Id. at 14.)

Prepared by Sarah Ettedgui, Law Library intern, under the supervision of Nicolas Boring, Foreign Law Specialist.


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Kenya: Parliament Considering Amendment to the Country’s 2001 Children Act

(Oct. 5, 2018) Kenya’s Parliament is currently reviewing a new bill—the Statute Law (Miscellaneous Amendments) Bill, 2018—which seeks to introduce key amendments to the 2001 Children Act. The Bill has recently gone through its first reading in the National Assembly, one of the two houses of the Kenyan Parliament. (Statute Law (Miscellaneous Amendments) Bill, 2018, KENYA GAZETTE SUPPLEMENT, NATIONAL ASSEMBLY BILLS, 2018 (Apr. 10, 2018), Kenya Law website; Children Act No. 8 of 2001 (commencement Mar. 1, 2002), Kenya Law website.)

One of the proposed changes under the Bill authorizes the Cabinet Secretary in charge of implementing the Children Act to deregister existing charitable children’s institutions or refuse to register new ones that fail to adhere to certain standards. (Statute Law (Miscellaneous Amendments) Bill, at 298–300.) Under the current Children Act, a charitable children’s institution is “a home or institution which has been established by a person, corporate or unincorporate, a religious organisation or a non-governmental organisation and has been granted approval by the [National Council for Children Services] to manage a programme for the care, protection, rehabilitation or control of children.” (Children Act §§ 2 & 58.)  Under this Act, it appears that the harshest restriction that can be placed on a charitable children institution is the cancellation of its program by the Council upon the recommendation of the Director of Children Services. (Children Act § 71.)  This may occur if

(a)  the institution is unfit for the care, protection and control of children; or

(b) the children admitted into the institution are suffering or are likely to suffer harm; or

(c) the manager of the institution has contravened any of the regulations made under [the law]. (Id.)

If the Bill is enacted, the Cabinet secretary will have the power to shut down an existing charitable children’s institution or deny registration to a new one if

(a) the lives of children in such institution are in danger or where their continued stay therein is likely to endanger their well being;

(b) the institution or a person involved in the management of such institution in unfit to provide care or protection to the children;

(c) it has been established that the institution does not serve the best interest of the
children therein; or

(d) such institution is in contravention of the Constitution, the Convention on Rights of the Child, the African Charter on the Rights and Welfare of the Child or any other law or international treaties or conventions to which Kenya is a party. (Statute Law (Miscellaneous Amendments) Bill, at 298–300.)

The Bill would also place similar restrictions on adoption institutions. It authorizes the Secretary to “decline to register or cancel the registration” of an adoption society, an institution that facilitates adoptions, under certain circumstances. This would occur if it is established that

(a) the operations of such adoption society are against the best interests of the child;

(b) such adoption society is no longer necessary; or

(c) the operations of such adoption society are in contravention of the Constitution or any other law or any international treaty or convention to which Kenya is a party. (Statute Law (Miscellaneous Amendments) Bill, at 302.)

In addition, the Bill would give the Child Welfare Society of Kenya, a state corporation, a great deal of power over the process of arranging adoptions. It states that “[n]o body of persons shall make any arrangements for the adoption of a child … unless such body is the national adoption society [the Child Welfare Society of Kenya] or any other body registered as an adoption society.” (Id. at 301; State Corporations Act (Child Welfare Society of Kenya) Order, 2014, § 4 (May 21, 2014), Kenya Law website.)

Significantly, the Bill seeks to eliminate payments to an adoption society or anyone else involved in facilitating an adoption. The current Act prohibits adopters, parents, or guardians of a child from receiving any payment in consideration of adopting the child. (Children Act § 179.) However, it permits adoption societies and advocates to receive payment or voluntary donations, stating that the above ban does not apply

(b) to any payment made by or on behalf of an adoption society in respect of the maintenance of a child who has been placed at the disposition of the society; or

(c) to any payment made to an adoption society by the parent or guardian of a child or by any other person in respect of the maintenance of the child, so long as the child is not in care and possession of a person who has adopted or proposes to adopt him, whether under an adoption order or some other order; or

(d) to any payment made to an advocate who acts for any party in or in connection with an application for an adoption order, being payments made in respect of such application; or

(e) to any voluntary contribution made by any adopter or any parent or guardian to an adoption society. (Id.)

The Bill would repeal all these exceptions that permit the making of payments and/or donations.

Children’s rights groups have expressed opposition to the Bill, arguing, among other things, that the central role in matters affecting children that it envisages for the Child Welfare Society of Kenya would essentially “make other institutions irrelevant and could kill them.” (Rhoda Odhiambo, Child Welfare Groups Oppose Law Changes, STAR (May 10, 2018).)

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Egypt: President Ratifies Anti-Cybercrime Law

(Oct. 5, 2018) In August 2018, Egyptian President Abdel Fattah al-Sisi ratified Law No. 175 of 2018, the “Anti-Cyber and Information Technology Crimes” law. (Law No. 175 of 2018, AL-JARIDAH AL- RASMIYAH [OFFICIAL GAZETTE], vol. 32 (bis) (c), 14 Aug. 2018 (in Arabic).) The newly enacted law, published in the Official Gazette on August 19, 2018, aims at fighting extremist and terrorist organizations that use the internet to promote their ideas among youth. The Law also bans the online dissemination of information on army and police movement and criminalizes hacking into information systems. (Mariana Barsoum, Egypt’s Sisi Ratifies New Cyber-crime Law, AHRAM ONLINE (Aug. 18, 2018).)

Law No. 175 consists of 45 provisions. Among them, article 2 requires telecommunications companies to retain and store users’ data for 180 days in order to assist the authorities in identifying users, metadata, and computer IP addresses. Article 4 of the Law obliges the Ministries of Foreign Affairs and International Cooperation to reach bilateral agreements covering Internet Technology (IT) and cybercrime with as many foreign governments as possible to block some websites in foreign countries. Article 7 grants the investigative authorities the power to block any website whenever they deem that the website’s content promotes extremist ideas that violate national security or damages the Egyptian economy. (Wafa Ben-Hassine, Egyptian Parliament Approves Cybercrime Law Legalizing Blocking of Websites and Full Surveillance of Egyptians, ACCESS NOW (June 20, 2018).)

Article 8 gives customers and internet service providers (ISPs) the right to appeal censorship decisions before the criminal court within seven days of the censoring of a website. (Law No. 175, art. 8.)

Article 13 provides that using wireless networks with or without the owner’s permission, or using broadcasting channels without a communications permit or broadcasting license is punishable by imprisonment for no less than three months and a fine of 10,000–50,000 Egyptian pounds (EGP) (about US$557–2,786). (How You Will be Affected by the New Cybercrime Law: A Guide, MADA MASR (Aug. 21, 2018).)

According to article 14, individuals who gain access to or hack a website, private account, or prohibited information system, whether intentionally or unintentionally, may be penalized with imprisonment of no less than a year and/or a fine of EGP50,000–100,000 (about US$2,786–5,573). If the hacking leads to the damage, erasure, altering, copying, or redistribution of data or information, the term of imprisonment would be for no less than two years. (Law No. 175, art. 14.)

Article 15 states that anyone who obtains access to a website, an account, or an information system using inappropriate privileges or timing is punishable by no less than six months of imprisonment and/or a fine of EGP30,000–50,000 (about US$1,672–2,786). (Id. art. 15.)

Under article 20, individuals convicted of hacking state information systems can be fined EGP50,000–200,000 (about US$2,786–11,145) and/or sentenced to imprisonment for two years. (Barsoum, supra.)

Creating fake accounts using the names of public figures or organizations is also punishable under the new law. Article 24 stipulates that anyone who creates a fake email address, website, or personal account in the name of actual individuals or organizations is punishable by a term of imprisonment of no less than three months and/or a fine of EGP10,000–30,000. Moreover, creating an account to insult a public figure may be punished by imprisonment and a fine of EGP100,000–300,000 (about US$5,573–16,718). (How You Will Be Affected by the New Cybercrime Law: A Guide, supra.)

In accordance with article 25, individuals who post on websites or social media platforms videos, photos, or texts of others without their consent and in violation of their privacy are punishable by no less than six months in prison and/or a fine of EGP50,000–100,000. Posting content that “violates the family principles and values upheld by Egyptian society” may be punished by a minimum of six-months’ imprisonment and/or a fine of EGP50,000–100,000. (Id.)

Finally, a service provider who fails to carry out a censorship order or directive issued by the competent authority against a specific website or online blog account is punishable under article 30 by no less than a year in prison and/or a fine of EGP500,000–1 million (around US$27,864–55,727). (Law No. 157, art. 30.)

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Sweden: Swedish Media Criticized by Swedish Press Council for Publishing Names of #MeToo Accused Without Cause

(Oct. 4, 2018) On June 25, 2018, the Swedish Pressens opinionsnämnd (PON, Press Council) in an unprecedented move issued critical opinions of the media regarding 10 of the 11 cases brought forward during 2018 in connection with the #MeToo movement. The Press Council condemned the media for publishing without sufficient cause the names of persons accused of sexual misconduct. (Senaste fällningar, PON (June 25, 2018).)

Press Freedoms and Ethics in Sweden

Under Swedish law publishers are protected by two of the four laws that make up the Swedish Constitution—the Freedom of the Press Act (TRYCKFRIHETSFÖRORDNINGEN (TF)) and the Fundamental Law on Freedom of Expression (YTTRANDEFRIHETSGRUNDLAGEN (YGL)), both on the Swedish Parliament website). However publishers’ freedom is not unlimited, and violations of press freedom may be punished. (1 kap. 3 § TF.)

In Sweden, media houses voluntarily subscribe to the Ethical Guidelines on Publishing. (Publicitetsregler, JOURNALISTFÖRBUNDET (May 21, 2018).) These rules include provisions highlighting the importance of respecting the private life of persons that the media houses write about. (Id. paras. 7–10.)

PON is responsible for determining what constitutes “the use of good publishing practice.” (PON, 1 § Stadgar för Pressens Opinionsnämnd, PON website (all translations by author).) PON is made up of two members each from the Publicistklubben (Publisher’s Club), Svenska Journalistförbundet (Swedish Journalist Association), Svenska Tidningsutgivareföreningen (Swedish Newspaper Publishers’ Association), and Sveriges Tidskrifter (Sweden’s Magazines). (Id. § 6.)

Publishers that are criticized by PON for violating the press ethical rules are obliged to publish the PON opinion in the same form (i.e., digital, print, or video) as the original criticized piece was published, and must also pay fines to PON, the amount of which depends on the size of the publication’s distribution. (Id. §§ 11 & 13.)

In addition to rules mentioned above, state media have additional requirements for how a broadcast may be conducted.

Section 15 of the Stadgar provides that “[t]he individual’s right to private life shall be respected in the program activities unless an undeniable public interest demands otherwise.” (Det gäller vid namnpublicering i svenska medier, SVT (Oct. 17, 2017).) Thus, the general rule for state media is to not publish the names of persons suspected or accused of a crime. Instead, state media policy has been to publish the names only when the crime “is particularly serious and when there is a great public interest. Publishing the name can also become relevant if [the crime] concerns a public person, such as a politician, CEO, or other person in a role of responsibility.” (Id.)

PON’s Media Criticism

During the past year with the growth of the #MeToo movement, several Swedish media corporations have published the names of persons who were not formally accused of sexual misconduct crimes in courts of law but who had been publicly accused by alleged victims. For instance, Svenska Dagbladet published an article with the name of a man accused by 12 women of sexual harassment. (PON, Svenska Dagbladet klandras för publicering om NN [namn angivet] (Case: Svenska Dagbladet, exp. nr. 88/2018, dnr. 17409, June 25, 2018).)

In this case PON found that

[w]hen a name is published and the person mentioned is negatively affected, it is of great importance that the publisher act with restraint and responsibly during the publication. A fundamental prerequisite for publishing must be that the publishing is compatible with good publishing practices and that there is evidence to substantiate the information.

Even though the newspaper that published the information had investigated the events and interviewed the participants, PON found that what the newspaper had accumulated in the form of background material did not warrant publishing a name. (Id.)

Another man, Martin Timell, a well-known media personality and TV carpenter who was publicly accused of sexual violence, including rape, but was later cleared of all charges in court also had his name published in the media. (PON, Expressen klandras: Pekade ut Martin Timell som skyldig (Case: Expressen, exp. nr. 89/2018, dnr. 17495, June 25, 2018); Timell efter domen: ‘Är oerhört lättad’, NÖJE (June 8, 2018).) The media outlet Expressen was criticized for writing about Timell as if he was already guilty. (Id.) PON did acknowledge that sexual violence crimes are of great public interest, and that it is imperative that such accusations be brought to light. It also maintained that public figures such as Timell must bear greater scrutiny than a nonpublic person. However, PON found that because Timell had been accused of a rape that had occurred a long time ago, the public interest did not warrant publishing his name. (PON, Expressen klandras: Pekade ut Martin Timell som skyldig (Case: Expressen, exp. nr. 89/2018, dnr. 17495, June 25, 2018.)

#MeToo Accusations May Be Defamation

Under Swedish law, even true accusations may be defamation—the fact that an accusation is true is not in itself a defense against defamation (förtal). (5 ch. 1 § 2 mom. (BROTTSBALKEN [BRB] [CRIMINAL CODE] (SFS 1962:700).)  Swedish courts have sentenced individual women to pay day-fines (fines calculated on the basis of the accused’s daily income) as well as monetary compensation  for accusing men on social media of raping or sexually assaulting them. (See, e.g., Fredrik Samuelson, Kvinna döms för förtal efter #metoo-inlägg, EXPRESSEN (Feb. 20, 2018).)

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