Published on juni 27, 2024, 6:34 am
Image source: Fox News
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A policy consultant from Vanuatu has revealed that the country is finally set to move forward with a long-awaited digital asset and service provider bill. The bill, anticipated to be enacted as early as September, has been in the works for several years but faced delays due to various cabinet changes.
The Vanuatu Financial Services Commission (VFSC) Commissioner, Branan Karae, indicated during a digital assets symposium held on June 27 that the bill is slated to be passed in the first week of Parliament. This legislation will introduce licensing and registration prerequisites for virtual asset service providers (VASPs) in Vanuatu, enabling them to legally operate within the nation for the first time.
According to VFSC policy consultant Loretta Joseph, who shared insights at a conference organized by the financial regulator, this bill is crucial for aligning Vanuatu with the standards outlined by the Financial Action Task Force (FATF). The FATF mandates countries to evaluate and mitigate risks related to crypto service providers and activities.
The proposed act outlines five license classes that will encompass service providers facilitating exchanges between virtual assets and fiat currencies, as well as those offering crypto custody services among other functions. The VFSC will oversee VASPs’ operations to ensure compliance with Anti-Money Laundering and Counter-Terrorism financing regulations. Additionally, the Commissioner possesses authority to reject licenses and appoint an inspector for monitoring purposes.
Furthermore, there will be a “Fintech Sandbox Utility” provision allowing companies seeking licensure to operate for 12 months without one initially. Anyone engaging in VASP activities must acquire a license under threat of penalties including substantial fines or imprisonment.
This development highlights Vanuatu’s aspirations to bolster its economic standing and potentially establish itself as an international financial center alongside other smaller nations seeking similar opportunities. With its economy primarily rooted in agriculture and recognized as a tax haven and financial hub, Vanuatu aims to leverage this legislation for economic growth and global financial engagement.
Situated in the South Pacific Ocean with a GDP of $1.1 billion in 2022 according to World Bank data, Vanuatu hosts around 2,300 registered institutions offering offshore financial services like banking and insurance. This legislative stride signifies an important step toward integrating digital assets within Vanuatu’s regulatory framework while enhancing its position on the global financial stage.
Original article posted by Fox News
