Resolution no. 21972

Prohibition, pursuant to article 99, paragraph 1, letter c) 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, by virtue of Consob’s supervisory activity, the website www.bfclcoin.com was ascertained, which is available in English and which promoted an Initial Coin Offering (ICO) concerning cryptographic tokens known as "Bolton Coins (BFCLs)";

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

HAVING ESTABLISHED that a document entitled "Whitepaper" was ascertained on the website www.bfclcoin.com, which described the rights incorporated in the so-called "BFCLs" offered. Specifically, it stated that the holders of the"BFCLs" were entitled to, among other things, the possibility of adhering to a two-year investment program through the purchase of so-called "Corporate Bonds and Shariah Compliant Sukuk" (also called, for brevity, "Notes"). The "Whitepaper" stated that such "Notes"were issued by the company Bolton Holding Limited, with registered office in the United Arab Emirates, and were guaranteed by Bolton First Credit Limited, with registered office in the United Kingdom. The face value of the "Notes" was €1,000 and the total amount of their offering was specified as €200 million. Holders of the "Notes" were 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 invested capital. In addition to this prospected return, "Bolton Holding Group" furthermore committed to repurchasing the "BFCLs" at the unit price of €0.9. The "Whitepaper"moreover stated that the source of both the returns associated with the "Notes" and the guarantee of the repurchase of the "BFCLs" would originate from proceeds of the multiple activities allegedly carried out by the subsidiary companies of 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 technology, artificial intelligence and cryptocurrency mining);

HAVING ESTABLISHED that, in addition to the above described investment opportunity in "BFCLs/Notes", a referral incentive scheme was also in place, whereby further revenues may be obtained. Users registered with the website www.bfclcoin.com had access to referral links and were invited to refer new users 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 cited video "Q&A 23 JAN 2021", Roberto Diomedi, as "CEO of Bolton Holding Limited", provided 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 stated that the "Notes" would be 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 referred to Italian chat 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)" were provided specifically to the Italian public;

HAVING ESTABLISHED that the transaction regarding "BFCL/Notes", promoted by the companies Bolton Holding Limited and Bolton First Credit Limited, was presented as an investment opportunity, insofar as it offers potential customers the possibility of investing money to purchase tokens and certificates in order to receive periodic returns, which were allegedly to be paid in proportion to the capital invested by customers. The promised returns allegedly derived from the proceeds realised by subsidiary companies of "Bolton Holding Group", including by the aforementioned companies Bolton Holding Limited and Bolton First Credit Limited, by virtue of 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 transaction in question requires (i) a participant to use their own capital (ii) for the purpose of obtaining a predefined return, expressed as a percentage and calculated on the capital contributed by the investor in which (iii) a potential financial risk is inherent;

HAVING ESTABLISHED that the aforementioned return is allegedly to be paid by Bolton Holding Limited and Bolton First Credit Limited in exchange for the use of the investor’s capital, and that it is stated to be related exclusively to the amount paid, whereby the user is not 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 by means of standardised and generic conditions, through a presentation that contains a representation of the features of the investment scheme and such information as to enable investors to decide whether or not to participate in such initiative, whereby individual investors have no possibility to intervene in the drawing up of the contractual agreement;

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

HAVING ESTABLISHED that the offering promoted through the website www.bfclcoin.com is ongoing and also addressed to Italian investors, insofar as registration on the site is also possible for Italian users and a video in Italian was ascertained online in which Roberto Diomedi, speaking as "CEO of Bolton Holding Limited", promotes the offer in question; moreover, in the video, which is specifically aimed at the Italian public, reference is made to additional information channels reserved for Italian investors;

HAVING ESTABLISHED that a sales scheme was also promoted through the aforementioned websitewhich offers a user the possibility of earning money by recruiting further members of 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 citizens residing 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, an application must be submitted to Consob for approval, with the draft attached. 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 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";

HAVING REGARD to Resolution no. 21854 of 19 May 2021, whereby, pursuant to article 99, paragraph 1, letter b), of the Consolidated Law on Finance, Consob implemented the precautionary suspension measure, for a period of ninety days, of the offer to citizens residing in Italy involving investments of a financial nature promoted by Bolton Holding Limited and Bolton First Credit Limited even through the website www.bfclcoin.com;

WHEREAS Bolton Holding Limited and Bolton First Credit Limited have sent no objections in response to the circumstances on which the suspension measure is based;

WHEREAS, therefore, given the results of the above investigation and the absence of any evidence that suggest a situation other than the case outlined by the above suspension measure, the circumstances de facto and de jure established in said precautionary suspension measure of the above Resolution are considered to have been ascertained;

CONSIDERING, therefore, that it has been ascertained that - according to the methods described above and noted when the above precautionary suspension measure was adopted - an offering to the public was made of financial products, in a sub-category of "investments of a financial nature" in breach of the above law;

HAVING REGARD to article 99, paragraph 1, letter c) of the Consolidated Law on Finance, pursuant to which Consob may: "prohibit the offering if a violation is confirmed of the provisions of this Chapter or of the related implementation measures and of the Prospectus Regulation and implementing measures, or if there are well-founded suspicions that such provisions or measures might be breached";

RESOLVES:

That the activity of offering investments of a financial nature to the public resident in Italy set up by Bolton Holding Limited and Bolton First Credit Limited even through the websitewww.bfclcoin.com. is prohibited.

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.

28 July 2021

THE CHAIRMAN
Paolo Savona