Norway introduces anti-money laundering rules for virtual currency exchanges

Virtual currency exchange providers and businesses that store cryptographic keys face new obligations in Norway, the Financial Supervisory Authority has announced.

The Ministry of Finance has established new money laundering regulations that come into force on October 15, 2018. The new regulations will cover Norwegian providers of virtual currency exchange and storage services. These providers will have to comply with the Money Laundering Act and must be registered with the Norwegian Financial Supervisory Authority. A transitional period has been granted for registering with the Authority – this period lasts until January 15, 2019.

The regulator notes that it will make sure that virtual currency exchange providers comply with the new AML rules and that they are registered. However, the Authority will not be monitoring other aspects of the activities of these companies, such as investor protection.

Let’s note that the law applies to companies established in Norway, as well as to Norwegian branches of foreign companies. The new rules also cover service providers that currently operate without being registered.

The information required for registration includes certain data about the business (name, business number, address, service offered), as well as data about the managers of the business. Regarding compliance with the new AML rules, this implies the customers answering to questions about the purpose of a transaction and/or the origin of funds. Service providers will have to report suspicious transactions to the regulator.

Let’s note that there are similar rules for digital currency exchange platforms in Australia. These businesses are required to comply with a range of AML/CTF obligations, including:

• adopting and maintaining an AML/CTF program to identify, mitigate and manage money laundering and terrorism financing risks;
• identifying and verifying the identities of their customers;
• reporting to AUSTRAC suspicious matters, and transactions involving physical currency of $10,000 or more;
• keeping certain records for seven years.