Facebook’s Libra project cannot be accepted without a strong set of rules, France’s Finance Minister Bruno Le Maire told CNBC Wednesday.
Facebook’s latest plan for a cryptocurrency — Libra — has been heavily criticized by policymakers around the world, including U.S. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell. Speaking to CNBC ahead of a meeting of finance ministers from the seven largest world economies, Le Maire said that Libra raises questions about money laundering and terrorism financing.
“I would say this is first of all a question of sovereignty. You have states, the United States, France, Germany, Italy — all sovereign states with sovereign currencies: dollar, euro and so on and they are sticking to some very strong commitments, some very strong rules. We cannot accept a new currency having the exact same kind of power, without the same kind of rules, without the same kind of commitments and without the same kind of obligations,” Bruno Le Maire told CNBC’s Steve Sedgwick in Chantilly, France.
“There is also a concern about money laundering, there’s a concern about the funding of terrorism,” Le Maire also said.
“How could we accept to have now a new currency which wouldn’t stick to the same kind of obligation(s),” he added.
In an attempt to address some of the ongoing concerns over its cryptocurrency plan, Facebook said on Tuesday that Switzerland’s data protection agency will oversee data and privacy protections. However, CNBC reported later on Tuesday that Facebook hadn’t actually reached out to the Swiss regulator on this issue.
France vs. US
The United States has recently ordered an investigation into France’s digital tax — a 3% levy that will apply to revenue from digital services earned in France by firms with more than 25 million euros in French revenue and 750 million euros worldwide. This means that it will likely hit big tech companies such as Facebook. The probe could ultimately lead to the United States imposing new tariffs or other trade restrictions on France.
France decided to move ahead with its own digital tax after the 28 EU member states failed to find common ground on how to impose a similar levy at the EU level.
Le Maire told CNBC that Paris could not wait for long for a consensus to emerge at the European and international levels.
“I am ready to wait, but I am not ready to wait for eternity,” Le Maire told CNBC. “People are waiting for decisions, not only for discussions.” He added that France’s decision to move first with a digital tax is an attempt “to open the way for an international compromise.”