Initial Coin Offering restrictions for Non-Resident Aliens (F-1 Student) United States residents who are not accredited investors are often not allowed to participate in Initial Coin Offerings (ICOs) which are not public offerings for the purpose of U.S. Securities laws. Are there such restriction for F-1 students who have been in the US for less than 5 years, who are non-resident aliens for tax purposes and are actually not citizens of the US but are citizens of another country?
Are there such restriction for F-1 students who have been in the US for less than 5 years, who are non-resident aliens for tax purposes and are actually not citizens of the US but are citizens of another country? Short Answer For the most part, citizenship and immigration status are legally irrelevant to your eligibility to participate in an ICO (there are isolated exceptions related to international trade sanctions, and there are certain "sensitive" industries that usually wouldn't apply to an ICO). This said, no issuer of coins is required to make the offering available to everyone who is not prohibited by the applicable laws from participating. For example, if someone wants to make an ICO available to anyone but Canadians, that is their prerogative. But, in practice, most private ICOs require investors to be accredited investors, and few students on F-1 visas have the wealth, income or professional qualifications necessary to be accredited investors. Long Answer In an ICO made in the United States, the issuer (i.e. the person creating the coins) and the underwriter (i.e. the professionals retained to handle the ICO for the issuer, which will sometimes be the same person as the issuer) are electing to treat the coins as "securities" for the purposes of U.S. law which means that they can be issued only as a "public offering" upon registration with the SEC under the '33 Act or the '34 Act, or under an exception to those acts. While the statutes enumerate exceptions to the Acts, almost everyone sticks to trying to comply with one of the safe harbor exceptions created by SEC Regulation D. This protects the issuer and underwriter from legal liability for making an unregistered offering of a security that does not fall within an exception to the registration requirement, even though it is not unambiguously clear that cyptocurrency coins are "securities." They do this because the consequence for being wrong on this legal question of first impression are very severe and could lead to civil liability for all losses that coin holders experience, large civil penalties that cannot be discharged in bankruptcy, and criminal convictions. Eligibility to participate in a private offering made pursuant to the Regulation D exceptions to U.S. Securities laws (mostly the '33 Act and '34 Act) governing public offerings of securities that often require someone to be an "accredited investor" does not depend upon the immigration status or citizenship of the investor. A private ICO would ordinarily be made under a Regulation D exception. There are two Regulation D exceptions (one for offerings of less than $1,000,000 in the aggregate by an issuer, and another for intrastate offerings) which do not require you to be an accredited investor and there are other exceptions with allow a small number of non-accredited investors to participate if they are provided a professional advisor to counsel them in evaluating the offer. The most popular Regulation D exceptions for private offerings, however, are limited to accredited investors, which are available without regard to citizenship. A non-citizen could probably not participate in an offering made pursuant to the intrastate exemption, but this exception is quite unpopular for issuers and underwriters because very few offerings qualify under it and the boundaries for qualification are not well defined. I could imagine an ICO being made under this exception but I am not aware of any that actually are be made in that manner. Generally, to be an accredited investor you must be a certain kind of business entity (e.g. a bank), or a member of a certain set of professions (e.g. lawyers and brokers), or have a certain net worth and/or income. To be an accredited investor, a person must demonstrate an annual income of $200,000, or $300,000 for joint income, for the last two years with expectation of earning the same or higher income. An individual must have earned income above the thresholds either alone or with a spouse over the last three years. The income test cannot be satisfied by showing one year of an individual's income and the next two years of joint income with a spouse. The exception to this rule is when a person is married within the period of conducting a test. A person is also considered an accredited investor if he has a net worth exceeding $1 million, either individually or jointly with his spouse. The SEC also considers a person to be an accredited investor if he is a general partner, executive officer, director or a related combination thereof for the issuer of unregistered securities. An entity is an accredited investor if it is a private business development company or an organization with assets exceeding $5 million. An organization cannot be formed with a sole purpose of purchasing specific securities. Also, if an entity consists of equity owners who are accredited investors, the entity itself is an accredited investor. In 2016, the U.S. Congress modified the definition of an accredited investor to include registered brokers and investment advisors. Also, if a person can demonstrate sufficient education or job experience showing his professional knowledge of unregistered securities, he is also considered an accredited investor. In contrast, in the case of a public offering, which must be registered with the SEC under the '33 Act or '34 Act, any adult of any nationality (except as noted below) can participate without being an accredited investor. Still, in general, a U.S. securities law perspective, an investor from the U.K. or France or South Africa is the same as a U.S. citizen, even though the tax treatment of the investment for a non-citizen is very different from the tax treatment of the investment for a U.S. citizen or permanent resident. The primary exception to this general rule is that there are some people in some countries who are prohibited from investing in U.S. securities as a consequence of international trade sanctions. These would include members of the families of certain government officials in Russia, Syria and Venezuela, for example. Usually, a private offering packet provided to potential investors (such as one I wrote a couple of months ago involving international investors as well as U.S. investors) will include a separate form in which potential investors certify to the issuer and underwriter of the offering that they are not prohibited from investing under these laws which are enumerated in the form. Non-citizens who are not resident aliens (i.e. who are not green card holders), are also usually required to make a disclosure related to income tax compliance that is different than the Form W-9 that has to be provided by U.S. citizens and green card holders. There are also certain industries (e.g. equity investments in Colorado legal marijuana dispensaries, or farms in some Great Plains states) in which non-resident non-citizens are simply prohibited from making investments entirely although there are no ICOs of which I am aware that would fit in that category.
I see that this would put me under heavy US regulation, and I'd like to avoid that, since it would require huge funding to hire lawyers to do something like that. There are many reasons for financial and banking industry regulations; namely, fraud protection, corruption and money laundering preventions, use of crypto to avoid taxes and records, etc. If you're serious about a startup that involves financial transaction, one of the first things you do is find a law firm to advise you on the legal plausibility of an idea. And be prepared to spend thousands and thousands of dollars in legal fees for regulatory approval. Would doing something like this solve my problem? You're really going to trust randos on the web for legal advice?
The GDPR allows the right to access to be limited if this access would “adversely affect the rights and freedoms of others” (Art 15(4) GDPR). However, access to the recording would not give you more information than you've already received during the phone call, so this exemption is quite unlikely to apply in any case. UK data protection law also has a large list of additional exceptions, as summarized here by ICO guidance. These exemptions also cover some aspects of trade secrets, and even mention insurance examples. However, not such exemption is likely to apply in your case: the recording would not give you more information than you already have. If the data controller is concerned about some parts of the conversation, they should provide a redacted copy and explain why the redactions were performed. They should not reject the request outright. If the data controller wants to reject the request entirely, they must do so within the time frame for the DSAR (one month), must explain their reasons, and must inform you that you're allowed to lodge a complaint with your supervisory authority or to sue them. However, ICO guidance is flexible on how detailed the reason for refusal can be: Where an exemption applies, the reasons you give to an individual for not complying with a request may depend upon the particular case. For example, if telling an individual that you have applied a particular exemption would prejudice the purpose of that exemption, your response may be more general. However, where possible, you should be transparent about your reasons for withholding information. Here, I don't see any reason why full transparency would be a problem, so I would expect that the data controller can point to a specific exemption in UK data protection law. If you are unsatisfied with the data controller's response, please consider lodging a complaint with the supervisory authority. In the UK, this is the ICO. On the ICO complaints page, you can fill out the online form about “your personal information concerns”.
Is it legal? Yes. You can make just about any payment arrangements you like. You wouldn't be able to verify compliance, though, without some connection to the student's employer. The IRS won't tell you how much money a third party earned, or how much tax they paid, in a given year. Pretty sure they can't provide that info, which is why companies wanting to verify your income ask for copies of your tax returns rather than permission to get those returns.
The reason that you are being asked to comply with a US law is because PayPal, a US company, is required to comply with US laws. If you do not comply, it is likely that they will be non-compliant and subject to sanctions. For more background, FATCA reporting is used to identify businesses that a company does business with. In this scenario PayPal does business with you, 'Kenorb Inc', and so must prove to the regulatory agencies that you are not a US based company, hence the need for the W-8BENE. In a similar way - people from other countries cannot simply ignore UK law when dealing with your business. As for your quotes - they are not contradictory.
What does the contract say? I write that so often I should get a stamp made. If the contract is silent, then it is implied that payment in US currency is acceptable, as is any other method of payment the parties agree to. As you have correctly quoted, there is no limit to the number of US coins that are valid for payments, unlike in many other jurisdictions where there is such a limit. Accept the coins, make the tenant wait while you count them one by one and then give them a receipt. Oh, and change your lease when you can to nominate sensible forms of payment like electronic transfer.
As user6726 notes in an answer, the page you link to derives from 26 USC 7701. However, it does not reproduce the text accurately. There, "United States person" is defined at section 7701(a)(30), and it notably lacks anything corresponding to "any other person that is not a foreign person." It's possible that that language is motivated by some court decision, but it's also possible that someone just added it for the sake of symmetry with the definition of "foreign person" without thinking about the logical paradox that it might create. Looking at section 7701, I don't see any explicit mention of US non-citizen nationals. It appears that such a person who does not live in one of the 50 states or the District of Columbia falls under the definition of nonresident alien at 7701(b)(1)(B) even though such a person is explicitly not an alien under the Immigration and Nationality Act. I do not see any regulations correcting this oversight, but I suppose that in practice such people are indeed treated as US citizens. I don't know enough about the classification of nonhuman legal persons as foreign or domestic to have any ideas about whether there are similar ambiguities there.
Any answer is somewhat speculative, because there are no significant legal precedents. That said, you are probably not in breach of counterfeiting laws, as they typically protect physical currencies. However, due to the way that laws are written, their scope may be somewhat fuzzy in areas that were not foreseen, so you may find that a law unintentionally does cover your act. However, even if the act would fall under the law as written, jurisdiction remains an issue. Where would this counterfeiting happen, legally? Again, as this was not foreseen by lawmakers, it's possible that you may fall under foreign jurisdictions, e.g. because you spend the fake BitCoin and the the recipient lives in a country that assumes jurisdiction because their citizen was defrauded.