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New Digital Assets Legislation

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New Digital Assets Legislation

Regulatory project led by CNB

The Seychelles Executive recently approved legislation on digital assets

The process of drafting new legislation began in January with consultations led by the National Committee for Combating Money Laundering and the Financing of Terrorism (CNB). Finalization is scheduled for the end of February. The new regulations will then be submitted for review with a view to making recommendations by March 15. This review will be considered by the Eastern and Southern Africa Anti-Money Laundering and Anti-Terrorist Financing Working Group (ESAAMLG) in September 2024.

The Digital Assets (DA) and Digital Asset Service Providers (DASP) Bill aims to « foster innovation and stimulate the development of the sector in a responsible and sustainable manner », Afif said. This regulatory framework aims to prevent the risks of financial crimes related to the misuse of digital assets and DASP services in the country.

Among the proposed provisions is the requirement for companies managing digital assets to have premises in Seychelles. Currently, the Seychelles Financial Services Authority (FSA) lists approximately 80 entities that could fall under the category of DAs and DNAPs. The FSA expects that these entities will have to apply for a license under the new law once it comes into force.

Mr. Afif warns that the strict application of these rules would rule out any unauthorized operations from Seychelles without the appropriate license. The CNB will also ensure that the regulations comply with the requirements of the Financial Action Task Force (FATF) Recommendation 15 on new technologies.

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