Resolution no. 21854

Suspension, pursuant to article 99, paragraph 1, letter b) of Legislative Decree no. 58/1998, of the Initial Coin Offering (ICO) regarding the investment of a financial nature known as "BFCL Coin (BFCL)" promoted by the companies Bolton Holding Limited and Bolton First Credit Limited including through the website www.bfclcoin.com

LA COMMISSIONE NAZIONALE PER LE SOCIETÀ E LA BORSA
[THE NATIONAL COMMISSION FOR COMPANIES AND THE STOCK EXCHANGE]

HAVING REGARD TO Law no. 216 of 7 June 1974, as subsequently amended and integrated; HAVING REGARD TO Legislative Decree no. 58 of 24 February 1998 (the "Consolidated Law on Finance");

HAVING ESTABLISHED that, as a result of Consob’s supervisory activity, the presence was noted on the web of the website www.bfclcoin.com, written in English, which promotes an Initial Coin Offering (ICO) regarding cryptographic tokens known as "Bolton Coins (BFCLs)";

HAVING ESTABLISHED that on the website www.bfclcoin.com the aforementioned "BFCLs" are offered at the unit price of 1 US dollar and the total amount of their offer is set at 554,333,333 tokens, equal therefore to 554,333,333 US dollars;

HAVING ESTABLISHED that the website www.bfclcoin.com contains a document, entitled "Whitepaper", which describes the rights incorporated in the so-called "BFCLs" offered. Specifically, it states that the holders of the"BFCLs" are entitled to, among other things, the possibility of adhering to a two-year investment program through the purchase of the so-called "Corporate Bonds and Shariah Compliant Sukuk" (also called, for brevity, "Notes"). With regard to the aforementioned "Notes", in the "Whitepaper" it states that they are issued by the company, Bolton Holding Limited, with registered office in the United Arab Emirates, and guaranteed by Bolton First Credit Limited, with registered office in the United Kingdom. The face value of the "Notes" is 1,000 euro and the total amount of their offer is 200 million euro. Holders of the "Notes" are promised the payment, on a quarterly basis and for the two years following purchase, of a monthly return of 1.83% with respect to the capital paid in. The promise of this return is accompanied by the commitment by the "Bolton Holding Group" to repurchase the "BFCLs" at the unit price of 0.9 euro. Also in the "Whitepaper" it states that the source of both the returns associated with the "Notes" and the guarantee of the repurchase of the "BFCLs" is the proceeds of the multiple activities allegedly carried out by the companies belonging to the aforementioned "Bolton Holding Group" (including the extraction and trade of raw materials such as gold, diamonds and rare earths; the provision of financial services; the development of emerging technologies such as robotics, Blockchain, artificial intelligence and cryptocurrency mining);

HAVING ESTABLISHED that, in addition to the above described investment opportunity in "BFCLs/Notes", there is also the possibility of receiving revenue through the performance of an affiliation activity. Users registered on the website www.bfclcoin.com are, in fact, provided with referral links and invited to recruit new parties to obtain additional profits;

HAVING ESTABLISHED that, in relation to the ICO of "BFCLs" and the related two-year investment program regarding the "Corporate Bonds and Shariah Compliant Sukuk (Notes)", the video entitled "Q&A 23 JAN 2021", available at https://www.youtube.com/watch?v=03eoR1uQj0M, has been identified on the YouTube channel;

HAVING ESTABLISHED that, in the aforementioned video "Q&A 23 JAN 2021", Roberto Diomedi, as "CEO of Bolton Holding Limited", provides information in Italian with reference, among other things, to the timing around issuing the aforementioned "Corporate Bonds and Shariah Compliant Sukuk (Notes)" and the payment of the related profits. Specifically, Diomedi states that the "Notes" would have been issued by Bolton Holding Limited «at the end of April [2021], with the first coupon after three months»;

HAVING ESTABLISHED that, in the aforementioned video "Q&A 23 JAN 2021", Diomedi also refers to chats of Italian groups, Italian networks and video tutorials in Italian, through which updates on the ICO of "BFCLs" and the related two-year investment program regarding the "Corporate Bonds and Shariah Compliant Sukuk (Notes)" would be provided specifically to the Italian public;

HAVING ESTABLISHED that the operation regarding "BFCL/Notes", promoted by the companies, Bolton Holding Limited and Bolton First Credit Limited, is presented as an investment opportunity, as it would seem to offer potential customers the possibility of using a sum of money to purchase tokens and certificates in order to receive periodic returns, which would be paid in proportion to the capital paid in by customers. The promised returns would derive from the proceeds realised by the companies belonging to the "Bolton Holding Group", including those aforementioned companies Bolton Holding Limited and Bolton First Credit Limited, in the course of the alleged activities carried out in the sectors of raw materials, financial services, technological development and cryptocurrency mining;

HAVING REGARD TO the fact that, according to the definition provided under article 1, paragraph 1, letter t) of the Consolidated Law on Finance a "public offering of financial products" must be understood to mean "any communication made to people, in any form and by any means, that presents sufficient information on the offer conditions and the financial products offered so as to render an investor capable of deciding to buy or subscribe the financial products including the placement through licensed parties";

WHEREAS the constituent elements of the public offer relevant for the purposes of the above provision can be summarised as follows:

a) the fact that the activity involves "financial products", a category that includes

- pursuant to article 1, paragraph 1, letter u), of the Consolidated Law on Finance - both the "standard" features of "financial instruments"and "every other form of investment of a financial nature";

b) the existence of communication intended to persuade investors to purchase or underwrite these financial products and, consequently, including at the very least a description of their main characteristics;

c) the fact that the communication in question is directed towards Italian residents;

WHEREAS the notion of an "investment of a financial nature"implies the presence of three elements at the same time: (i) an investment of capital; (ii) a promise/expectation of a return of a financial nature; (iii) the assumption of a risk directly connected and related to the investment of capital;

WHEREAS the structure of the operation in question requires (a) a participant to use their own capital (b) for the purpose of obtaining a predefined return, expressed as a percentage and calculated on the capital contributed by the investor in which (c) a potential financial risk is inherent;

HAVING ESTABLISHED that the aforementioned return would be paid by Bolton Holding Limited and Bolton First Credit Limited against the use of the investor’s capital, and that it would be related exclusively to the amount paid, the user not being asked to undertake any activity other than the mere contribution of capital;

WHEREAS the legal reason for the negotiating proposal may be considered to be the production of a financial return as consideration for the use of capital transferred by the recipients of this return, who, therefore, transfer their own money with the expectation of a profit, namely, the increase in the cash invested;

CONSIDERING, therefore, that, with regard to the existence of the requirement referred to in letter a), namely, that the offering in question can be classified as a "financial product", the investment offered by Bolton Holding Limited and Bolton First Credit Limited based on the foregoing, qualifies as an "investment of a financial nature";

HAVING ESTABLISHED that the initiative in question is promoted in standardised and uniform terms, through a presentation that contains a representation of the features of the investment scheme that is such as to place investors in a position to decide whether or not to participate in the actual initiative, but without the possibility for an individual investor to intervene in drawing up the contractual agreement;

HAVING ESTABLISHED, therefore, that the requirement set out under letter b) is also met;

HAVING ESTABLISHED that the offer promoted through the website www.bfclcoin.com is ongoing and also addressed to Italian investors, as registration on the site is also possible for users connected from Italy and a video in Italian has been identified online in which Roberto Diomedi, as "CEO of Bolton Holding Limited", promotes the offer in question; moreover, in the video, specifically dedicated to the Italian public, reference is made to additional information channels reserved for Italian investors;

HAVING ESTABLISHED that a sales scheme is also promoted through the abovementioned website which offers a user the possibility of earning money by recruiting further participants in the initiative and that this scheme is suitable to also disseminate the offer of financial products among Italian investors;

CONSIDERING, therefore, that the requirement set out in letter c) is met, since the offering in question is aimed at the public resident in Italy;

CONSIDERING, therefore, that the activity carried out by Bolton Holding Limited and Bolton First Credit Limited to promote investments of a financial nature has the characteristics of a public offering of financial products as defined above;

HAVING REGARD TO article 94-bis, paragraph 1 of the Consolidated Law on Finance, pursuant to which "Anyone intending to make an offer to the public of financial products other than open-ended units or shares of UCITS must publish a prospectus in advance. To this end, they shall submit an application for approval of the same to Consob, attaching the draft. The prospectus cannot be published until it has been approved by Consob pursuant to article 95, paragraph 1, letter b)";

HAVING ESTABLISHED that, in relation to the activity described, the information prospectus intended for publication has not been sent to Consob;

HAVING ALSO ESTABLISHED that, based on current evidence, the offering in question does not appear to fall into any of the exemptions - contemplated by the combined provisions of articles 100 of the Consolidated Law on Finance and 34-ter of Consob Regulation no. 11971/98 - from enforcement of the rules on "solicitation of public savings";

WHEREAS, therefore, there is a well-founded suspicion of the promotion of a public offering of financial products in breach of the aforesaid legislation and the public offering of the financial products in question is still ongoing;

HAVING REGARD to article 99, paragraph 1, letter b) of the Consolidated Law on Finance, on the basis of which Consob: "may suspend the public offering as a precautionary measure for a maximum of ninety days of products other than those specified under letter a) [i.e., securities] in the event of a well-founded suspicion of a violation of the provisions of this chapter or the related implementation regulations";

WHEREAS, given the existence of the above conditions, there is an urgent need to adopt the measure identified above;

RESOLVES:

As a precautionary measure, to suspend, for a period of 90 days, the offer to the public resident in Italy set up by Bolton Holding Limited and Bolton First Credit Limited including through the website www.bfclcoin.com.

This Resolution shall be brought to the attention of the concerned parties and published in the Consob Bulletin.

This measure may be appealed before the Regional Administrative Court of Lazio within 60 days of the date of service.

19 May 2021

THE CHAIRMAN
Paolo Savona