Korea’s Financial Services Commission(FSC) has officially requested virtual asset service providers(VASPs) to submit an application for registration to operate in Korea. This is to stay in accordance with the revised Act on Reporting and Using Specified Financial Transaction Information. The revised compliance imposes strict anti-money laundering measures on exchanges and effectively sets legal boundaries for crypto exchanges that had operated in legal blind spots.
As of March 25, 2021, VASPs are now required to register their business with the Korea Financial Intelligence Unit(KoFIU) prior to the start of the business operation. Existing businesses qualifying as VASPs had to register until September 24, 2021, otherwise were subjected to penalties.
The revised rule which had gone into effect on March 25, 2021, mandates VASPs to have AML duties. AML duties include verifying the identities of customers, filing reports on suspicious transactions, and screening from the watchlist. For the purpose of VASPs meeting compliance with AML requirements, the authorities will supervise on VASPs upon the business registration.
The government will ensure effective management of the registration process. It announced the plan to enhance supervision on virtual asset transactions to prevent illegal transaction activities and improve the transparency of virtual assets.