Virtual Asset Service Providers (‘VASPs’) in Ireland are now required to comply with Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) obligations. This happens as the European Union’s Fifth Anti-Money Laundering Directive (‘5AMLD’) has been transposed into Irish law effective 23 April 2021 by way of the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021.

For the purposes of the legislation, VASPs are firms that provide any of the following services relating to virtual assets:

• a) exchange between virtual assets and fiat currencies;
• b) exchange between one or more forms of virtual asset;
• c) transfer of virtual assets, that is to say, to conduct a transaction on behalf of another person that moves a virtual asset from one virtual asset address or account to another;
• d) custodian wallet provider; and
• e) participation in, and provision of, financial services related to an issuer’s offer or sale of a virtual asset or both.

VASPs are required to register with the Central Bank for AML/CFT purposes only. VASPs established in Ireland and carrying on business as a VASP immediately prior to the 2021 Act coming into force, have three months to apply to the Central Bank for registration. It will be a criminal offence to operate as a VASP in Ireland in the absence of registration.

All VASPs established in Ireland are required to register with the Central Bank for AML/CFT purposes only.

Firms not established in Ireland and/or not carrying on business as a VASP immediately prior to the 2021 Act coming into force must be registered with the Central Bank prior to the commencement of any services relating to virtual assets from Ireland.

VASPs established in Ireland and carrying on business as a VASP immediately prior to the 2021 Act coming into force, have 3 months to apply to the Central Bank for registration.

If a firm that is currently authorised by the Central Bank for prudential and/or conduct of business services is, or plans to also carry on business as a VASP, this firm is obliged to register with the Central Bank as a VASP.

In order for the Central Bank to approve a VASP’s an application for AML/CFT registration, the Central Bank must be satisfied that:

• the firm’s AML/CFT policies and procedures are effective in combatting the money laundering and terrorist financing (ML/TF) risks associated with its business model; and
• the firm’s management and beneficial owners are fit and proper.