Proposed update to Travel Rule Code (Press Release)

Amendments are being proposed to the Island's anti-money laundering and countering the financing of terrorism ("AML/CFT") framework in relation to Virtual Asset Service Providers ("VASPS").

The Isle of Man Financial Services Authority ("the Authority") is working in conjunction with the Department of Home Affairs to update the existing Travel Rule (Transfer of Virtual Assets) Code 2024 ("the Travel Rule Code 2024").

The amendment to the Travel Rule Code 2024 will be made through the Travel Rule (Transfer of Virtual Assets) (Amendment) Code 2026, which is being laid before the March sitting of Tynwald.

This will revise the wording in paragraph 7 of the Travel Rule Code 2024 in relation to unhosted wallet transfers to make the application of this measure more proportionate and allow VASPs to apply a more risk-based approach.

The Authority is also working in partnership with the Treasury to bring the Travel Rule Code 2024 under the scope of the AML/CFT (Civil Penalties) Regulations 2019. Subject to Tynwald approval, this amendment will be achieved through the AML/CFT (Civil Penalties) (Travel Rule) (Amendment) Regulations 2026.

The proposed revisions to the AML/CFT legislative framework have followed extensive consultation and collaboration with the Island's VASP sector, ensuring the application of the Travel Rule Code 2024 remains appropriate while also continuing to meet the required international standards.