Travel Rule Requirements for VASP (2022-02-22)

Summary

This is a General Industry Notice from the Cayman Islands Monetary Authority (CIMA) advising that Part XA of the Anti-Money Laundering (Amendment) (No. 2) Regulations, 2020 will come into effect on 1 July 2022. Part XA introduces the 'Travel Rule' for virtual asset service providers (VASPs), requiring them to obtain and hold accurate originator and beneficiary information for virtual asset transfers, mirroring FATF Recommendation 16's wire transfer requirements.

The notice applies to all VASPs registered with, or in the process of registering with, CIMA.

• Existing/registering VASPs: Must notify the Authority, by a specified deadline, of how they intend to comply with the Travel Rule provisions, including submitting their compliance policies, procedures, and details of resources (including technology) to be used.
• New applicants: Going forward, new applicants for VASP registration or licensing must also demonstrate, as part of their application, how they will comply with the Travel Rule.
• Submission method: This must be submitted as an attachment to their AML/CFT policies via the REEFs application system (APP 101-84, Schedule E).

Key obligations

• Existing VASPs registered or in the process of registering with CIMA must email details of their Travel Rule compliance arrangements (policies, procedures, and resources/technological tools) to vaspinfo@cima.ky by 31 March 2022.
• New applicants for VASP registration/licence must indicate in their application how they will comply with the Travel Rule provisions.
• New VASP applicants must include their Travel Rule compliance information as an attachment when submitting AML/CFT policies via the REEFs application (APP 101-84, Schedule E).

Applies to

virtual asset service providers (VASPs)

Deadlines

• 31 March 2022: Deadline for VASPs registered or in the process of registering with CIMA to email details of their Travel Rule compliance arrangements to vaspinfo@cima.ky.
• 1 July 2022: Effective/commencement date of Part XA of the Anti-Money Laundering (Amendment) (No. 2) Regulations, 2020, containing the Travel Rule requirements.