Taiwan has accelerated the introduction of its regulatory Anti-Money Laundering (AML) framework for crypto businesses. The brand new regulations, set to start out nearly a month upfront, require Virtual Asset Service Providers (VASPs) to comply with the registration mandate to stop stricter penalties.
Taiwan Fast-Tracks Recent AML Mandate
Taiwan’s Financial Supervisory Commission (FSC) recently announced it might advance the implementation of its crypto AML registration regulation from January 1, 2025, to November 30, 2024.
The AML overhaul, announced in October, will introduce stricter AML guidelines for VASPs and require all crypto firms to finish the AML registration with the Taiwanese government by September 2025.
The companies that fail to register won’t be authorized to supply services within the country and will face a two-year prison sentence or fines of as much as 5 million NTD, price around $155,000.
Per the brand new regulations, the listing and delisting of digital assets will likely be closely monitored, and crypto firms are expected to ascertain measures against illicit trading and report any suspicious activity related to trading volume and price movement.
Furthermore, FSC requires registered crypto service providers to arrange an annual risk assessment report and detail client assets. The regulator mandated digital asset custodians to carry customer assets in trust or separate them from the platform’s assets.
To register, firms must submit a form that outlines their business nature. Any changes to the knowledge provided in this kind needs to be updated inside five business days with the Securities Over-the-counter (OTC) Trading Center.
The brand new regulatory framework will replace Taiwan’s current system for VASPs. Firms that accomplished the previous AML regulations must comply with the brand new system and complete the registration process.
After the announcement, the FSC fined two local exchanges, MaiCoin and BitoPro, for violating AML guidelines related to customer due diligence (CDD), transaction monitoring, record-keeping, and suspicious transaction reporting.
More Crypto-Related Laws To Come
This 12 months, Taiwan has been working to update its regulatory framework to implement crypto-related laws that expand on its seemingly cautious but friendly approach. The country’s Ministry of Finance recently announced it might work on a framework that addresses crypto tax evasion.
As reported by Bitcoinist, Finance Minister Chuang Tsui-yun and Director-general of the Taxation Administration Sung Hsiu-ling pledged to review the present regulations inside the subsequent three months to “higher enable the federal government to tax cryptocurrency gains.”
The finance minister admitted that the country had not implemented a system that effectively collects digital asset-related taxes from individuals despite having policies to gather business and company income taxes from the 26 crypto exchanges that accomplished the AML registration.
Legal experts noted that the financial authorities might face challenges addressing this issue with the present tax laws as investors can evade scrutiny “by disguising the transactions as overseas activity conducted in U.S. dollars.” Consequently, Taiwan’s regulators must amend these regulations to handle crypto tax evasion.
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