Amending AMLO: The Next Step on the Road to Regulating Virtual Assets

The Financial Services and Treasury Bureau (the “FSTB”) has published its conclusion paper (“Conclusion”) to the November 2020 consultation on making changes to the Anti-Money Laundering and Counter Terrorist Financing Ordinance (Cap. 615, Laws of Hong Kong) (the “AMLO”) (the “Consultation Paper”). In the Conclusion the FSTB has confirmed the approach it will take will be in line with most of the proposals in the Consultation Paper for: 

• a new regime for regulating and licensing virtual assets (“VA”) service providers (“VASPs”); 
• the introduction of a register and supervision for dealers in precious metals and stones (“DPMS”); and 
• amendments to AMLO to address weaknesses identified by the Financial Action Task Force (“FATF”). 

However, the Conclusion does not provide all the details that industry may have been hoping for and we will have to wait for further detail in certain areas, such as licensing criteria and ongoing regulatory requirements for VASPs. 

We previously published a note on the Consultation Paper with a summary table of the proposal. Read on to see our updated table reflecting what the FSTB has said in the Conclusion on VA, as well the additional changes to AMLO.