Vague Penalties Threaten Innovation

The Authority can impose administrative penalties of 20,000-50,000 penalty units for "failing to comply with a directive"—but the bill never defines what constitutes a "directive" or what standards govern their issuance. For digital innovators and startups, this creates legal uncertainty about compliance obligations and existential financial risk from penalties that could force business closure. Worse, the Authority can suspend licenses or prohibit business operations merely for failure to pay penalties, without requiring criminal conviction or judicial oversight. This enforcement regime chills experimentation and disproportionately impacts early-stage companies that lack capital reserves to absorb penalties or survive license suspension.