Travel Rule (Transfer of Virtual Assets) Code 2024

Closed 15 Apr 2024

Opened 4 Mar 2024

Contact

Ashley Whyte

(Senior Manager)

AML/CFT Division – Isle of Man Financial Services Authority

+44 1624 646000

aml@iomfsa.im

Feedback updated 7 Oct 2024

We asked

The Isle of Man Financial Services Authority ('the Authority'), in conjunction with the Department of Home Affairs, invited feedback on proposals to introduce a new Anti-Money Laundering and Countering the Financing of Terrorism Code, the Travel Rule (Transfer of Virtual Assets) Code 2024 ('the Travel Rule Code'). The Travel Rule Code creates a legislative framework to implement the expanded scope of the Financial Action Task Force’s ('FATF') Recommendation 16 regarding virtual asset transfer obligations.

You said

The Authority received 1 response to the consultation. This response was supportive of the introduction of the Travel Rule Code.

We did

The Authority prepared a consultation response document, which provides a summary of the feedback submitted and responds to any questions raised. The Authority will now prepare the final Travel Rule Code which is scheduled to commence in October 2024.

Overview

This Consultation Paper (‘the Paper’) is issued by the Isle of Man Financial Services Authority (‘the Authority’) in conjunction with the Department of Home Affairs (‘DHA’). The Authority is the regulatory body for financial services in the Isle of Man and the oversight body for Designated Businesses (‘Designated Business’) in relation to compliance with Anti-Money Laundering (‘AML’) and Countering the Financing of Terrorism (‘CFT’) obligations.

The purpose of the consultation is to obtain views regarding the proposed introduction of a new code: the Travel Rule (Transfer of Virtual Assets) Code (‘the Code’). The primary objective of the Code is to implement the expanded scope of the Financial Action Task Force’s (‘FATF’) Recommendation 16* to ensure the Island’s continued compliance with international standards.

The contents of this Paper are of importance to the Regulated and Designated Business sectors with specific relevance to entities engaged in Virtual Asset Trading and wider Virtual Asset Service Provider (‘VASP’) activity. Prior to this consultation being issued, the Authority sought feedback from relevant stakeholders which has been considered as part of the pre-consultation process.

The current term used for this sector on the Island is Convertible Virtual Currency (‘CVC’) activity. This term was adopted in 2015 prior to the wider development of international frameworks, which included standardised terminology. The terms ‘virtual-assets’ or ‘VASPs’ and ‘crypto assets’ or ‘CASPs’ have become more widely used and are terms used in many sectoral and regulatory proposals. For the purposes of this Paper the Authority will use the terms ‘virtual-assets’ or ‘VASPs'**, unless context indicates otherwise.

*FATF Methodology for assessing technical compliance with the recommendations.

**See consultation Designated Businesses (Amendment) Order 2024 and Proceeds of Crime (Business in the Regulated Sector) Order 2024 – where it is proposed that the sector terminology is updated across the Island’s AML/CFT framework from CVC to VASP.

Confidentiality and Data Protection

The information you send may be published in full or in a summary of responses. All information in responses, including personal data, may be subject to publication or disclosure in accordance with the access to information regimes (these are primarily the Freedom of Information Act 2015 and the Data Protection Act 2018) with which the Authority is obliged to comply.

The Authority is registered with the Information Commissioner as a data controller under Isle of Man data protection legislation. It collects and processes personal data to carry out its functions under relevant legislation and may share personal data with other parties where there is a legal basis for doing so. Further information on how the Authority collects and processes personal data can be found in the Privacy Policy on the Authority’s website.

If you have a query in relation to how this consultation has been carried out, please contact the Authority’s AML/CFT Division by email at aml@iomfsa.im or by telephone on +44 1624 646000.

Responding to this Consultation Paper

This Consultation Paper has been published on the Authority's website and on the Isle of Man Government's Engagement Hub ('the hub' - this site). A list of specific representative groups to which this Consultation Paper has been sent is shown below: 

  • Alliance of Isle of Man Compliance Professionals
  • Association of Chartered Certificated Accountants (as oversight body)
  • Association of Corporate Service Providers
  • Chartered Institute for Securities and Investment (Isle of Man branch)
  • The Department for Enterprise
  • Digital Isle of Man
  • Finance Isle of Man
  • Financial Intelligence Unit
  • Financial Planners & Insurance Brokers Association
  • Gambling Supervision Commission
  • Institute of Certified Bookkeepers (as oversight body)
  • Institute of Chartered Accountants In England and Wales (as oversight body)
  • Institute of Directors (Isle of Man branch)
  • Institute of Financial Accountants (as oversight body)
  • International Association of Bookkeepers (as oversight body)
  • Isle of Man Wealth & Fund Services Association
  • Association of Chartered Certified Accountants (Isle of Man branch)
  • Isle of Man Association of Pension Scheme Providers
  • Isle of Man Bankers Association
  • Isle of Man Captive Association
  • Isle of Man Chamber of Commerce
  • Insurance Institute of the Isle of Man
  • Isle of Man Law Society (as oversight body)
  • Isle of Man Post Office
  • Isle of Man Society of Chartered Accountants
  • Isle of Man Insurance Association
  • Society of Trust and Estate Practitioners (Isle of Man branch)
  • The  Treasury

The closing date for comments is 15 April 2024.

Before you respond, please ensure that you have read the Consultation Paper. You can respond to this Consultation Paper online by clicking on the 'Online Survey' link below. Responses made outside of the ‘Online Survey’ can be submitted by email to aml@iomfsa.im and, if in an attachment, preferably in an extractible format e.g. Microsoft Word document. Alternatively, you can submit responses by post to:

Ashley Whyte – Senior Manager, AML/CFT Division
Isle of Man Financial Services Authority
PO Box 58,
Finch Hill House,
Bucks Road,
Douglas,
Isle of Man,
IM99 1DT

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