Ireland VASP

Register a virtual asset service provider in Ireland

Ireland is the perfect gateway to do business and trade Bitcoin in the European Union; one of the oldest bitcoin services providers, BitEx is based in Ireland; among those who consider establishing a crypto business within the EU, Ireland is commonly known as one of the most favourable options.

Cryptocurrencies are widely supported on a national scale in Ireland, which also offers excellent terms for obtaining a cryptocurrency licence, acting as a gateway to crypto trading in the EU.

Ireland hosts multiple global financial and information technology giants; corporate taxation in Ireland is low at 12.5%; Blockchain Association of Ireland is bullish about the current state of the world’s most popular cryptocurrency. Over 430 Financial Services companies are operating from Ireland today, including twenty of the Top 25 Global Institutions.

Ireland’s unique ecosystem has led to the development of the world-class fintech sector that continues growing every year. Recently, the country published a new Strategy for the International Financial Services Industry called “Ireland for Finance”, which outlines ambitious targets for the development of the IFS industry in Ireland and Dublin acting as the leading Financial Services hub.

Ireland is an excellent location for Research Development & Innovation, as the country provides funding support, including tax credits and funds aid by IDA Ireland.

Virtual Assets Service Providers authorised in Ireland are eligible to passport to other EEA member states. These are some great reasons to open a cryptocurrency company in Ireland.

Setting up your VASP entity in Ireland

The Central Bank of Ireland (‘Central Bank’) is the competent authority in Ireland with responsibility for the AML/CFT registration and supervision of VASPs under the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021, as amended (‘CJA 2010 to 2021’). It is important to note that a registration as a VASP is a registration for AML/CFT purposes only.
VASPs are “designated persons” for the purposes of the CJA 2010 to 2021 and are required to comply with the AML/CFT obligations contained under Part 4 of the CJA 2010 to 2021.

Applicant Firms applying for AML/CFT registration will have to submit an application to the Central Bank. In order for the Central Bank to approve an application for registration, the Central Bank must be satisfied that an Applicant Firm’s AML/CFT policies and procedures are effective in combatting the money laundering and terrorist financing (‘ML/TF’) risks associated with its business model, and an Applicant Firm’s management and beneficial owners are fit and proper.

Each applicant seeking registration must satisfy the Central Bank that it can meet its obligations under the CJA 2010 to 2021. In fulfilling its statutory role in this regard, the Central Bank adopts a robust, structured and risk-based process that seeks to ensure that only those applicants that demonstrate that they are in a position to comply are registered.

The Central Bank will process each application for registration as expeditiously as possible, while meeting its obligation to operate a rigorous and effective gatekeeper function.

Regulation of virtual asset service providers

The European Union’s Fifth Anti-Money Laundering Directive (‘5AMLD’) extended Anti-Money Laundering and Countering the Financing of Terrorism (‘AML/CFT’) obligations to entities that provide certain services relating to virtual assets.

Ireland transposed 5AMLD into Irish law by way of the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 (‘2021 Act’) and the provisions of the 2021 Act that relate to VASPs commenced on 23 April 2021.

The 2021 Act extends the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021 (‘CJA 2010 to 2021’) to VASPs.

For the purposes of the legislation, VASPs are firms that provide any of the following services relating to virtual assets:

  1. Exchange between virtual assets and fiat currencies;
  2. Exchange between one or more forms of virtual assets;
  3. Transfer of virtual assets, that is to say, to conduct a transaction on behalf of another person that moves a virtual asset from one virtual asset address or account to another;
  4. Custodian wallet provider; and
  5. Participation in, and provision of, financial services related to an issuer’s offer or sale of a virtual asset or both.

What does this mean for VASPs?

VASPs are “designated persons” for the purposes of the CJA 2010 to 2021 and are required to comply with the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) obligations contained under Part 4 of the CJA 2010 to 2021. VASPs will also be subject to the following requirements:

Registration with the Central Bank for AML/CFT purposes

All VASPs established in Ireland are required to register with the Central Bank for AML/CFT purposes only. Firms not established in Ireland and/or not carrying on business as a VASP immediately prior to the 2021 Act coming into force must be registered with the Central Bank prior to the commencement of any services relating to virtual assets from Ireland. VASPs established in Ireland and carrying on business as a VASP immediately prior to the 2021 Act coming into force, have 3 months to apply to the Central Bank for registration. If a firm that is currently authorised by the Central Bank for prudential and/or conduct of business services is or plans to also carry on business as a VASP, this firm is obliged to register with the Central Bank as a VASP.

In order for the Central Bank to approve a VASP’s an application for AML/CFT registration, the Central Bank must be satisfied that:

  • the firm’s AML/CFT policies and procedures are effective in combatting the money laundering and terrorist financing (ML/TF) risks associated with its business model; and
  • the firm’s management and beneficial owners are fit and proper.

Please note that it is a criminal offence to carry on the business of a VASP in the absence of registration.

Ongoing AML/CFT obligations

AML/CFT obligations contained under Part 4 of the CJA 2010 to 2021 which include:

  • carrying out an ML/TF risk assessment of their business;
  • undertaking customer due diligence (CDD) of their customers;
  • carrying out ongoing monitoring of customers and customer transactions;
  • filing Suspicious Transaction Reports (STRs) with Financial Intelligence Unit (FIU) Ireland and the Revenue Commissioner in instances where money laundering or terrorist financing is known or suspected;
  • maintaining and implementing AML/CFT policies, procedures and controls;
  • retaining appropriate records; and
  • providing AML/CFT training to all staff on an ongoing basis.

The Central Bank’s approach to fitness and probity

The Central Bank’s Fitness and Probity Regime was introduced by the Central Bank under the Central Bank Reform Act 2010 (‘The 2010 Act’). The Fitness and Probity Regime applies to persons in senior positions (referred to in the legislation as Controlled Functions (CFs) and Pre-Approval Controlled Functions (PCFs) within regulated financial service providers (RFSPs).

A person performing a CF must have a level of fitness and probity appropriate to the performance of that particular function. PCFs are a subset of CFs and the prior approval of the Central Bank is required before an individual can be appointed to a PCF role.

A firm must not permit a person to perform a CF unless:

the firm is satisfied on reasonable grounds that the person complies with the Central Bank’s fitness and probity standards; and

the person has agreed to abide by the Central Bank’s fitness and probity standards.

A firm must not appoint an individual to perform a PCF role until the Central Bank has approved the appointment in writing.

In addition to the Central Bank’s Fitness and Probity Regime for CFs and PCFs, the CJA 2010 to 2021 also places an obligation on the beneficial owners of VASPs to be fit and proper.

Does the Compliance Officer (MLRO) need to be located in Ireland?

The Central Bank of Ireland does not require a firm’s Compliance Officer (MLRO) to be located in Ireland. In line with the principle of territoriality enshrined in the EU AML Directives and Section 25 of the CJA 2010 to 2021, the Central Bank expects a physical presence located in Ireland and for there to be at least one employee in a senior management role located physically in Ireland, to act as the contact person for engagement with the Central Bank.

Level of expertise expected from the MLRO

The Firm should ensure that the MLRO:

has sufficient and appropriate AML/CFT knowledge and expertise;

has the autonomy, authority, and influence within the Firm to allow them to discharge their duties effectively;

is capable of providing effective challenge within the Firm on AML/CFT matters when necessary;

has the capabilities, capacity and experience to oversee the identification and assessment of suspicious transactions and to report/liaise with the relevant authorities where necessary in relation to such transactions;

keeps up to date with current and emerging ML/TF trends and issues in the industry and understands how such issues may impact the Firm;

has access to adequate resources and information to allow them to discharge their duties effectively; and

is readily accessible to staff on AML/CFT matters.

Ireland taxation on cryptocurrencies

There are no special tax rules in Ireland for buying and selling crypto assets. Instead, the treatment of crypto assets depends on the general principles of Irish tax law. Irish Revenue have also issued some guidance on particular tax aspects of crypto assets. There is very broad range of crypto assets, with a wide range of features and exposures.

If an Irish resident company sells crypto at a profit, it will typically be treated as making a capital gain, similar to an individual, and subject to capital gains taxation, currently 33% for companies also. Losses are also typically treated in the same way as individuals.

If an Irish resident company is carrying on a ‘trade’ of dealing in crypto, any profit on the sale of crypto would generally be subject to corporation tax at the rate of 12.5%. It is generally accepted there is less difficulty for a company, compared to an individual, to establish that it is carrying on a trade of dealing in financial assets but there nevertheless remains a high bar in establishing that the company has the necessary substance and sophistication to be carrying on a trade of buying and selling financial assets.

For Irish eBrief direct access, click HERE.

VASP application process

Before applying for registration

In advance of submitting a VASP AML/CFT registration form, the Applicant Firms should satisfy itself that:

  • the services it is proposing to offer constitute VASP services as set out in the CJA 2010 to 2021;
  • it is in a position to comply with its AML/CFT obligations under the CJA 2010 to 2021; and
  • the onus is on the Applicant Firm to ensure that it is satisfied that it is conducting a VASP activity. Independent legal advice should be sought if an Applicant Firm is in any doubt as to whether registration is required.

Summary of the key stages in the registration process

  1. Applicant submits a VASP Pre-Registration Form to the Central Bank.
  2. The Central Bank issues an email to the applicant containing an Institution Number, a Reporting Date and details on how to access and submit a VASP AML/CFT Registration Form via the Central Bank’s Online Reporting (’ONR’) system.
  3. The applicant submits a VASP AML/CFT Registration Form and all supporting documentation through the ONR system.
  4. The Central Bank acknowledges receipt of the VASP registration submission by email to the Applicant Firm.
  5. The Central Bank assesses whether the VASP registration submission contains all required information and documentation to progress to the assessment phase and notifies the Applicant Firm by email.
  6. Where all the required information and documentation has been provided, the Central Bank conducts an assessment of the registration application. Where necessary, the Central Bank will request further information and/or clarification from the applicant.
  7. The applicant is provided with the opportunity to respond to the Central Bank’s request for further information and/or clarification.
  8. The Central Bank will assess the additional information provided by the applicant and notify the applicant of its assessment and next steps. The applicant may be provided with a further opportunity to address concerns arising at this stage in the process (if any).
  9. The Central Bank will notify the applicant of its decision to either grant or refuse the registration.

Required documents and information for application purposes

(a) VASP’s AML and CFT policies and procedures;
(b) VASP’s money laundering and terror financing risk assessment;
(c) details of all direct and indirect ownership and management in the VASP;
(d) individual questionnaires to assess the fitness and probity of all individuals who are proposed to hold preapproved control functions in the VASP;
(e) business plan setting out the VASP’s proposed activities, transaction flows, projections and any outsourcing arrangements envisaged;
(f) VASP’s proposed organisational structure, AML and CFT reporting lines and staffing arrangements; and
(g) VASP’s AML and CTF training plan.

All you need to get your crypto registration fast and successful.

TBA 2-step work

Step 1

  • Application preparation, communication with the regulator, business services
  • Filling out an application form
  • Communication with Development authority during the application phase
  • Assistance in the development of AML, CFT documents
  • Assistance in the opening of safeguarding accounts
  • Company formation, staffing services

Step 2

  • Preparation of legal, financial and IT documents
  • Legal documents: AML, KYC, IT/Security policies, etc.
  • Financial documentation: 3-years financial forecast, P&L statement, the flow of funds
  • Company operational documentation: internal policies, risk operation policies, internal audit, etc.
  • IT documentation

Estimated time to get a VASP license

We aim to get your application in within six weeks; approval by the Central Bank of Ireland can go up to around 6 months. However, if additional requests for information or documentation are issued by the Central Bank of Ireland, the process may take longer.

How TBA can help you

We assist in the full registration process with the Central Bank of Ireland. If you are looking to obtain a Crypto Asset Services Provider (VASP) license in Ireland, TBA can offer you its legal, technical and business expertise and consulting support.

Our dedicated financial services development team works closely with clients who are subject to AML/CFT requirements across a number of sectors. We have also advised a number of clients engaged in providing crypto services in Ireland.

We have vast experience in dealing with AML/CFT issues across the spectrum from establishing an AML/CFT framework and preparing policies and procedures; providing annual training; advising on suspicious transaction report filings; advising on governance and outsourcing arrangements related to AML/CFT and guiding clients through themed inspections and supervisory / enforcement engagement on AML/CFT.

Should you need more information about registering your Crypto Assets (VASP) Company in Ireland, we welcome you to get in touch with one of our financial services development team.

Our company licensing services

— What we do and do not do

Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.

TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!

Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.

We help you grow your business across international border and achieve financial efficiency.

We are ready to answer all your questions!