Some of the changes proposed include relaxing the requirement on businesses to verify the address of most customers, extending the timeframe for businesses to submit prescribed transaction reports, and exempting registered charities from AML/CFT obligations when they are providing small loans.

Other changes signaled include defining virtual assets and virtual asset service providers (VASPs), setting a threshold for virtual asset transactions to be occasional transactions, and explicitly bringing VASPs that provide safekeeping or administration of virtual assets into the regime.

Some of the draft regulations will come into force on 31 July 2023, while others will come into force on 1 June 2024. The proposed changes may require reporting entities to make significant changes to their AML/CFT compliance programmes, and some entities who have relied on exemptions to date may now find themselves inside the regime.

The Ministry of Justice (MoJ) is currently consulting with the industry for feedback and have asked for submissions to be provided by 5 pm on 14 April 2023. Feedback will provide greater visibility of the regime and help MoJ to understand what the practical consequences of the proposed changes may be.

We will keep you up to date as more information is released but if you have any questions or would like assistance in making a submission, please get in touch.