Australian Senate debates “Bitcoin bill”
The bill, which will require digital currency exchanges to enroll and register with AUSTRAC, had its first reading at the Senate today, with the second reading next in line.
The Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2017, also known as Australia’s “Bitcoin bill”, is slowly making its way through the Australian parliament.
After the document’s third reading on Wednesday by the House of Representatives, the bill was introduced and read a first time at the Senate today, with the second reading moved. The second reading is usually seen as crucial, as it culminates in a vote that signifies that the bill is agreed to or rejected.
If the bill gets the green light from both the House of Representatives and the Senate, it will be presented to the Governor-General for assent.
The “Bitcoin bill” proposes changes to the current AML/CTF law by modernizing it to take into account digital currencies like Bitcoin. Under the bill, businesses that trade digital currencies for money, and vice versa, will be required to:
- enroll and register with AUSTRAC;
- establish, implement and maintain an AML/CTF program, which sets the framework for businesses to comply with their obligations, including customer due diligence requirements;
- report threshold transactions and suspicious matters to AUSTRAC, and
- keep appropriate records.
The extent of penalties proposed remained the same in the third reading version of the bill. The penalties start from imprisonment for 2 years and/or 500 penalty units for those who violate the requirement for registration with AUSTRAC for providing digital currency exchange services. The penalty may reach 7 years of imprisonment and a fine of 2,000 penalty units if the AUSTRAC CEO gave the person a direction in relation to violations of registration rules and accepted undertakings given by the person in relation to registration violations on numerous occasions.
In a report, tabled in October, the Senate Legal and Constitutional Affairs Legislation Committee said it understands that the bill’s provisions would be the first phase in a multiple-stage reform effort to update the Australian anti-money laundering and counter-terrorism financing regime. The reforms are needed in order to adequately reflect the role digital currencies play in the modern economy.
The committee emphasized that submitters were generally positive about the intent and provisions of the bill, and the contribution it would make to preventing money-laundering and terrorism financing, in addition to improving the legislative framework governing digital currency.
