AMF’s 2022 Report; Rise in Number of Digital Asset Service Providers

As per the Department’s briefing held in June 2023, last year’s “turbulence” in the crypto-asset markets and the increasing numbers of digital asset service providers (PSANs) registered with the AMF. The count from 28 PSANs in 2021 is now 59 PSANs in 2022. Controversies regarding crypto-assets focus on stablecoins and loans of digital assets (crypto-lending and staking).

Investment and trade links between France and the U.S. are firm, with an average sales and commercial transactions of around $350 Million in their everyday work. The U.S. exports include industrial as well as technological exports done to France.

The United States, in 2021, was the top foreign investor in France with around 10,118 jobs created and second in terms of new project investments.

The total stock of U.S. Foreign Direct Investment (FDI) in France is over $91 Billion. More than 4,500 U.S. firms work in France, supporting over 500,000 jobs, making the U.S. the top foreign investor. French firms support almost 750,000 jobs in the U.S. Over the past few years, clean technology companies have been a leading sector for French FDI.

In May 2017, the French government introduced robust labor market and tax reforms. Leveraging the rules on the company’s hire-and-fire policies, the government reduced production taxes by 15% in 2021, and reduced the corporate tax to 25% in 2022.

The onset of the Covid-19 pandemic in 2020 redirected Macron’s focus towards France’s most severe economic crisis in the post-war era. France’s economy shrank 8.3% in 2020 compared to the previous year, but with government support, economic growth hit 7% in 2021. The amount upheld in government’s fiscal policy stood up with €100 Billion ($110 Billion) as per the France Relance plan.

The France Relance Plan’s support was accessible to U.S. firms operating in France. The government launched a follow-on investment program in late 2021 called “France 2030” to “boost productivity, maintain competitiveness, and pace the ecological evolution.”

AMF Regulations and Operation in French Financial Market

The AMF controls participants and products in France’s financial markets. It holds, approves, monitors, and, wherever necessary, conducts investigations. It also ensures that investors receive material information and provides them with necessary mediation service to help them in altercations.

The AMF regulations in the financial market controls its infrastructures, listed companies, and the financial intermediaries authorized to provide investment services, as a whole.

Formed in 2003, it is headed by a Chairman and an Enforcement Committee. The AMF is authorized to impose disciplinary sanctions and penalties. The agency coordinates with other French regulators, especially in the banking and insurance sectors.

A Joint Unit: “ACPR-AMF”

ACPR and AMF set up a Joint Unit in 2010. This alliance lets the two authorities enhance the supervision of “Financial Product Market” in France to improve investor security.

The AMF mediator published her 2022 annual report. Marielle Cohen-Branche, the AMF mediator, delivered her report for the past year at an official conference. The number of referrals to the AMF mediator jumped 33% in 2021 and stayed nearly stable last year, at 1,900 requests, or around 500 files more than the levels observed.

As per her analysi,s 1.3 Million retail investors entered the equity markets over the past four years which increased the ultimate demand in the market. The year 2022 ended with a 35% reduction in the lot. Critical figures for AMF mediation in 2022:

1,900 files received in total, around 3% less than in 2021.
2,089 files processed and completed, with a 12% increase from 2021, including 1,341 falling within the scope of the mediator.
1,014 recommendations were issued, with a 33% increase from 2021.
The proposals made by the mediator remained mainly favorable to the applicants, with a high rate of support in their favor.

The number of complaints related to stock market orders doubled in 2021 and became fivefold in 2020. The files often come from inexperienced investors who need to learn about the stock market’s fundamental principles and the specificities of types of orders, specifically those that do not allow the execution price to be controlled.

The mediation has also been captured by the complex requests relating to transactions of the companies listed by the U.S. Exchange Authority with small capitalization called “microcaps.”