If you decide to run the ICO through a new corporate vehicle, we can help with the formation, shareholders’ agreement and, if there is to be any investment from third parties, the investment documentation.
If you wanted to set up a foundation or a holding company in another jurisdiction (Gibraltar, Isle of Man, Switzerland etc,), we could refer you to lawyers/accountants/tax advisers who could help and, if required, oversee the relationship.
- Review of Executive Summary
If you are at the design phase, and would find this useful, we would ask you to provide us with an executive summary for review. This would, amongst other things, cover:
- objectives of doing ICO
- purpose of token in the context of the associated industry or domain iii. whether you would adopt ERC20 or a different protocol iv. how you intend to use the proceeds v. the infrastructure i.e. foundation or corporate entity
We would review the summary and then have a meeting with you to discuss it and how we see it in terms of the legal landscape/compliance
- White Paper
Typically the client prepares a first draft and we then review and amend this. The general aims would be:
- to prevent it falling the wrong side of the tokens/securities divide as obviously if it fell in the latter category, we would be talking IPO not ICO.
- to sense check the white paper and to liaise with you to eliminate any potential misrepresentations
- to insert appropriate wording re disclaimers and limitation/exclusion of warranties and liability
- Terms and Conditions
- There would need to be a contribution agreement for those who wanted to purchase tokens setting out the basis. We would need information from you to draft this and work out cost. This would have to set out clearly which countries’ citizens would be permitted to contribute. (you would need to back this up with technology to ensure that you did not take contributions from blacklisted countries)
- There would also need to be appropriate privacy and, if applicable, cookie policies on the website
- If you intending using an external platform, then we would review the terms and conditions of the platform provider and advise/negotiate as required
- If you are commissioning software developers to build a platform, we could draft such terms once we had seen your summary of what is required.
- We can also draft Terms of Business, based on a summary from you of how you intend to operate.
C. KYC and AML and CTF
We would suggest you outsource this to non-lawyers. We could refer you to appropriate advisers who could help and, if required, oversee the relationship.
D. Data privacy
We would advise on Data Protection Act/GDPR/PECR2 implications to ensure that those were factored into your data harvesting/website.
E. Tax law/International
This might be provided by tax accountants. We know firms who could assist. We would not advise on pros and cons, tax implications or legal issues relating to establishment of a foundation or other vehicle outside of the UK.
For further information, please contact Simon Halberstam at Simon.Halberstam@smab.co.uk.