Guidance on Application for Registration of a Virtual Assets Service Provider

Summary

This is FSC guidance explaining how to apply for registration as a Virtual Assets Service Provider (VASP) under the Virtual Assets Service Providers Act, 2022. It sets out what a complete application must contain, the fees payable, transitional arrangements for existing VASPs, and ongoing obligations once registered.

• Who must register: Operators of virtual assets exchanges, providers of virtual assets custody services, and persons conducting business to provide other virtual assets services.
• Application requirements: A complete application form with supporting documentation covering shareholding structure, corporate governance, capital and reserves, technological audits, liquidity, risk management, consumer protection, related party policies, custody arrangements, escrow provisions, interoperability, and cessation/living-will plans.
• Authorised Representative: Applicants must engage a registered Authorised Representative (AR), who must separately apply for approval using Form D of the Guidelines for Approved Persons.
• Application fees: $10,000 for custody service applicants, $10,000 for exchange operators, and $5,000 for other VASP applicants; fees are payable per category applied for and applications will not be processed without payment.
• Additional conditions: The FSC may require professional indemnity insurance (or a surety bond/trust account) and/or a Regulatory Deposit as a condition of registration.
• Ongoing obligations: Registered VASPs must keep the basis of their registration up to date, maintain fit and proper status and adequate resources, obtain prior FSC approval for certain changes (e.g. ownership, directors), notify the FSC of specified events, and file annual returns, annual financial statements and annual compliance officer reports.

Existing VASPs operating before the Act came into force had a six month transitional window from commencement to apply for registration; those who did not apply by the stated deadline are treated as conducting unauthorised business and subject to full enforcement action.

Key obligations

• Applicants must submit a complete VASP application form with all required supporting documentation and the applicable application fee before an application will be processed.
• Applicants must engage a registered Authorised Representative, who must submit a separate application (Form D) for approval.
• Existing VASPs operating before the Act's commencement must have submitted an application for registration by 31 July 2023 or be treated as conducting unauthorised business.
• Applicants seeking to provide custody services or operate an exchange must pay a $10,000 application fee; other VASP applicants must pay $5,000.
• Applicants must respond to any FSC request for clarification or additional information within 30 days (or an extended period) or the application will be considered withdrawn.
• Registered VASPs must obtain prior FSC approval for changes in ownership/control and directors/senior officers.
• Registered VASPs must notify the FSC of specified events affecting the registration decision, including under the AMLTFCOP and Regulatory Code.
• Registered VASPs must file annual returns, annual financial statements, and annual compliance officer reports.
• Registered VASPs must maintain adequate human and technological resources and appropriate policies and procedures to remain fit and proper on an ongoing basis.
• Where required as a condition of registration, VASPs must obtain professional indemnity insurance or equivalent arrangement, and/or place a Regulatory Deposit with the FSC.

Applies to

Virtual Assets Service Providers (VASPs), Operators of Virtual Assets Exchanges, Providers of Virtual Assets Custody Services, Authorised Representatives (ARs)

Deadlines

• 31 July 2023: Deadline for existing VASPs (operating before the Act's commencement) to submit applications for registration, per the six month transitional period in section 40 of the Act; failure results in being deemed to conduct unauthorised business.
• 30 days: Time allowed for an applicant to respond to an FSC request for clarification or additional information on a pending application (or any extension granted), after which the application is considered withdrawn.
• 6 weeks: FSC's target to provide initial comments on a completed application.
• 6 months: FSC's service standard for concluding the application process from the initial submission date.
• annually: Registered VASPs must file annual returns, annual financial statements, and annual compliance officer reports.