Circular No. 7 of 2024: Transitional Period Under the VASP Act

Circular No. 7 of 2024
Date: 23rd October, 2024
Transitional Period under the VASP Act
Following the commencement of the Virtual Asset Service Providers Act, 2024 (“VASP Act”) and its accompanying Regulations, the Financial Services Authority (“Authority”) is issuing this Circular to inform investors, entities incorporated in Seychelles and the general public that are operating as virtual asset service providers (“VASPs”) or issuing initial coin offering (ICO) or non-fungible token (NFT) regarding the transitional period granted under the VASP Act for the submission of an application for a licence or an application for registration respectively. In accordance with section 42 of the VASP Act, a person conducting virtual asset services1 or issuing an ICO or NFT on 1st September 2024 is permitted to continue to carry out such business activities provided that a complete licence or registration application is submitted to the Authority, prior to the expiration of the transitional period, which concludes on the 31st December, 2024. The public is informed that failure to submit a complete application by 31st December 2024 will result in a breach of the VASP Act, for which a person may be subject to such enforcement action, inclusive of but not limited to:

• The striking of the name of the company off the register (this applies to both, companies
  incorporated under the Companies Act, 1972 and the International Business Companies Act, 2016).
• For companies, a fine not exceeding SCR 5,250,000.
• For individuals, a fine not exceeding SCR 2,250,000 or to imprisonment not exceeding 15 years
  or both.
  Entities registered and/or incorporated in the Seychelles and operating as a VASP or issuing ICO or NFT, are reminded that a mere registration and/or incorporation under a statutory legislation does not equate to the grant of a licence or an authorisation. It is therefore essential for every Seychelles’ registered and/or incorporated entity that are providing virtual asset services or issuing ICO or NFT to clearly differentiate their registration and/or incorporation status when soliciting clients, advertising their services or communicating in any manner. 1 As per the First Schedule of the VASP Act, these activities are Virtual Asset Wallet Providers (custodial services), Virtual Asset Exchange (Transfer services, Conversion services, Exchange services), Virtual Asset Broking (Intermediary and facilitation services), Virtual Asset Investment Providers (Investment and funds management, and Advisory services).

Companies registered and/or incorporated in the Seychelles may publicly disclose the submission of their application to the Authority only after the company has received confirmation as to the application having been accepted and therefore deemed complete. Please be informed that any persons who were not operating as a VASP or issuing an ICO or NFT on 1st September 2024 (i.e. commencement date of the VASP Act) must first apply and obtain the required licence or authorisation prior to the offering of any virtual asset services or the issuance of any ICO or NFT. Persons operating as a VASP and/or issuing an ICO or NFT on 1st September, 2024 (i.e. these include (i) persons which started operating as a VASP on 1st September, 2024 and (ii) persons which started operating as a VASP prior to 1st September 2024 and were still operating as a VASP on 1st September,
2024) are reminded that, effective 1st January 2025, any person that has failed to submit a complete
application to the Authority by 31st December, 2024 must cease operations immediately. Failure to do so will constitute a breach of section 5 or 27 of the VASP Act and may lead to the imposition of the enforcement actions as previously outlined. All application documents may be accessed on the FSA’s website via the links provided below. Licencing: https://fsaseychelles.sc/vasp/apply-for-license Registration: https://fsaseychelles.sc/vasp/apply-for-registration The Authority may be contacted at vass@fsaseychelles.sc for any clarification or further information regarding the content of this Circular. FINANCIAL SERVICES AUTHORITY