Feedback on follow on consultation on AML/CFT scope exemptions (2022-12-15)

Summary

This is a feedback paper issued by the Government of Jersey and the JFSC responding to industry comments on the follow-on consultation (September 2022) about realigning Jersey's AML/CFT registration regime with FATF standards. It summarises common themes and question-specific feedback, sets out the JFSC's responses, and describes the resulting policy decisions ahead of the Amending Law and Amending Regulations being brought into force.

Key policy decisions

• AMLSP (formerly DSP): The 'Designated Service Provider' concept is renamed the Anti-Money Laundering Services Provider (AMLSP) and will sit under the Supervisory Bodies Law rather than as a separate FSJ Law business class; no FSJ Law application or fee is required, but an AMLSP must apply to the JFSC and provide a list of PESPs it services and the MLRO/MLCO it will provide to each.
• PESP Key Persons: PESP MLRO/MLCO ('Key Person') roles will not be limited to PQ'd individuals; instead the AMLSP must notify the JFSC of named individuals, who will be vetted for fitness and propriety, and must keep this list up to date without needing to notify the JFSC of each individual PESP change.
• Director exemptions removed: All exemptions relating to directors, including the previous de-minimis exemption allowing a director of up to six companies to avoid AML/CFT registration as a TCSP, no longer exist; anyone providing director services as a business is conducting TCSP business.
• Jersey presence requirement: There is no intention to remove the requirement for Key Persons to be based in Jersey.
• Transitional arrangements: Businesses previously out of scope by exemption, or not previously required to register, will be able to apply for DSP/AMLSP and PESP registration once the transitional period opens; registration forms will be published on the JFSC website following the States debate.

The paper also confirms next steps: the Amending Regulations were lodged with the States in December 2022, with debate anticipated in early 2023, after which the Amending Law and Amending Regulations are expected to be brought into force via a Commencement Order. Consequential changes to the AML/CFT Handbook, Codes of Practice and Guidance Notes are also flagged as forthcoming.

Key obligations

• Regulated service providers wishing to act as an AMLSP must apply to the JFSC, providing a list of the PESPs they service and details of the MLRO and MLCOs they will provide to each PESP.
• AMLSPs must maintain an up-to-date list of which individuals are appointed as Key Person to which PESP, based on the list previously notified to the JFSC.
• Individuals proposed as PESP Key Persons will be vetted by the JFSC for fitness and propriety before appointment.
• AMLSPs and PESP Key Persons must ensure they have sufficient capacity, skills and experience to fulfil AML/CFT obligations to each PESP to which they are appointed.
• Any person providing director services in exchange for remuneration as a business must register as conducting Trust Company Business (TCSP), as director exemptions (including the six-company de-minimis exemption) no longer apply.
• PESP Key Persons must continue to be based in Jersey.

Applies to

Prescribed/Politically Exempt Service Providers (PESPs), Anti-Money Laundering Services Providers (AMLSPs, formerly DSPs), Trust Company Business (TCB) licence holders, Fund Services Business (FSB) licence holders, MLROs and MLCOs, Directors providing director services as a business, Designated Non-Financial Businesses and Professions (DNFBPs), Virtual Asset Service Providers (VASPs)

Deadlines

• anticipated to commence January 2023: Start of the transitional period during which regulated service providers may apply to the JFSC for AMLSP/DSP and PESP registration.
• early 2023: Anticipated States debate on the Amending Regulations, after which the Amending Law and Amending Regulations are expected to be brought into force via Commencement Order.