What is a digital contract?.. The law on fintech responds

 Law No. 5 of 2022 promulgating the law regulating and developing the use of financial technologies in non-banking financial activities defined the digital contract as a contract that includes the rights and obligations of the contracting parties in electronic form, and can be registered in a digital contract can also be a “smart contract” through a program to automatically implement, control or document the terms of the contract.

digital contract

The law states that the digital record is: "an electronic record that includes data relating to transactions carried out by natural or legal persons that take place in accordance with the provisions of this law, allowing the monitoring of this data through a secure network. ".

The law also stipulates that digital identity: is any technically processed data that is linked to a specific natural or legal person or that can be identified directly or indirectly by linking this data to other data such as name, voice, image, identification number, or online identity, these data must allow the evaluation and validation of transactions carried out via digital platforms.

The law states that the digital platform is a business model based on the use of technological means in the conduct of non-banking financial activities and in the presentation of related products and services to those wishing to obtain them and that it allows the exchange of data and information necessary to finalize these transactions.

Article 2 of the law on the regulation and development of the use of financial technology in non-banking financial activities stipulates that the Authority aims, through the implementation of the provisions of this law, to strengthen financial inclusion, and work to broaden the base of beneficiaries of non-banking financial activities. financial activities, increase their efficiency and reduce the costs necessary to benefit from these activities and services.

The Authority is the exclusive administrative authority competent to apply the provisions of this Law and takes all necessary measures to promote and develop the use of modern and innovative financial technology systems in any of the fields of non-banking financial activities. and provide financial advice relating thereto, and is entitled to achieve the purposes of this Act in a manner including:

  1. Take steps to set up companies subject to the provisions of this law.
  2. Grant the license and the necessary authorizations to carry out the activities provided for by this law.
  3. Use technological applications to ensure compliance with established laws and rules in order to facilitate the IMF's oversight role over the entities subject to it with regard to compliance with transparency and governance standards, the protection of brokers in non-banking financial markets, and the adoption of innovative technological tools to facilitate relations with the non-banking financial sector in the field of the use of financial technology.
  4. Use technological applications to digitally collect data, verify them and analyze their indicators through programs designed for this purpose, and use artificial intelligence mechanisms and other digital models to detect incidents that constitute violations of the laws regulating non-banking financial activities, and suspicions of liquidity, funding or other financial stability issues.
  5. Establish a regulatory testing environment for fintech applications, either by itself or in partnership with third parties.
  6. Establish data and device security controls.
  7. Supervision and control of companies and entities subject to the provisions of this law.
  8. Receive the complaints lodged by the stakeholders of the concessionaires with the companies carrying out non-banking financial activities using financial technology, concerning the violation of the provisions of this law or the decisions taken for its implementation.
  9. Prepare and publish the studies and statistics necessary to improve the practice of non-banking financial activities using financial technology.
  10. Publicize non-banking financial activities that are carried out using financial technologies, protect the rights of traders in these activities and preserve the competitive climate that promotes their growth.

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