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2022 | OriginalPaper | Buchkapitel

Where’s Wally? FATF, Virtual Asset Service Providers, and the Regulatory Jurisdictional Challenge

verfasst von : Louis de Koker, Talha Ocal, Pompeu Casanovas

Erschienen in: Financial Technology and the Law

Verlag: Springer International Publishing

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Abstract

Das Kapitel behandelt die regulatorischen Herausforderungen, vor denen die Financial Action Task Force (FATF) bei der Überwachung von Virtual Asset Service Providern (VASPs) in verschiedenen Ländern steht. Es untersucht den historischen Kontext des Regulierungsrahmens der FATF und die zunehmende Komplexität der Regulierung von VASPs aufgrund ihrer digitalen Natur. Der Text untersucht den "sinnvollen Denk- und Managementtest" und seine Anwendung auf Großbanken, wobei die Notwendigkeit eines umfassenderen Ansatzes zur Regulierung von VASPs hervorgehoben wird. Außerdem werden die Regulierungsansätze verschiedener Länder wie Australien, Kanada, Japan, den Niederlanden, Singapur und Großbritannien verglichen und die Beschränkungen und Schwachstellen in ihren Zuständigkeitssystemen diskutiert. Das Kapitel schließt mit der Forderung nach einer engeren Zusammenarbeit zwischen AML / CFT und den Steuerbehörden, um den globalen Regulierungsrahmen für VASPs zu stärken.
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Fußnoten
1
Hülsse (2008).
 
2
FATF (2019).
 
3
FATF (2021a, c).
 
4
SS Lotus (France v Turkey) (Judgment) 1927 PCIJ (ser A) No 10.
 
5
Ireland-Piper (2012).
 
6
Goodhart and Lastra (2010).
 
7
Lastra and Allen (2018).
 
8
Mehar et al. (2019).
 
9
OECD (2019a), p. 7.
 
10
OECD (2019a), par 1–2.
 
11
Wang (1940).
 
12
De Beers Consolidated Mines, Ltd v. Howe [1907] UKHL 626 (30 July 1907, p. 627.
 
13
De Beers Consolidated Mines, Ltd v. Howe [1907] UKHL 626 (30 July 1907), p. 627.
 
14
This was a new formulation of an already-entrenched approach. See American Thread Co. v. Joyce 6 TC 1, p. 18 where Hamilton, J referred to Lord Loreburn’s test and remarked as follows: “This test, ‘the real business is carried on where the central management and control actually abides’, does not differ to my mind in substance from the tests mentioned in earlier cases, such as ‘the conduct and management, the head and brain of the trading adventure’ in the San Paulo Railway case in 3 Tax Cases, or the expression which has not been uncommonly used by Commissioners ‘the head and seat and directing power of the affairs,’ but, owing to its being compact and precise, it appears to me to be the convenient one for adoption.”
 
15
De Beers Consolidated Mines, Ltd v Howe [1907] UKHL 626 (30 July 1907), pp. 626–627: “In applying the conception of residence to a company we ought, I think, to proceed as nearly as we can upon the analogy of an individual. A company cannot eat or sleep, but it can keep house and do business. We ought therefore to see where it really keeps house and does business. An individual may be of foreign nationality and yet reside in the United Kingdom. So may a company. Otherwise, it might have its chief seat of management and its centre of trading in England under the protection of English law, and yet escape the appropriate taxation by the simple expedient of being registered abroad and distributing its dividends abroad.”
 
16
Bullock (H M Inspector of Taxes) v The Unit Construction Co, Ltd [1959] UKHL TC 38 712.
 
17
Bullock (H M Inspector of Taxes) v The Unit Construction Co, Ltd [1959] UKHL TC 38 712, p. 722: “In the appeal before us, we find the controlling power and authority, which according to the constitution of each of the African subsidiaries is vested in its board of directors, is actually exercised, to a very substantial degree, by the board of Alfred Booth & Co., Ltd., in London.”
 
18
Bullock (H M Inspector of Taxes) v The Unit Construction Co, Ltd [1959] UKHL TC 38 712, p. 736 per Viscount Simonds: “The business is not the less managed in London because it ought to be managed in Kenya. Its residence is determined by the solid facts, not by the terms of its constitution, however imperative. If indeed I must disregard the facts as they are, because they are irregular, I find a company without any central management at all. For, though I may disregard existing facts, I cannot invent facts which do not exist and say that the company’s business is managed in Kenya.”
 
19
Untelrab Ltd & Ors v McGregor (HMIT) (1995) Sp C 55, para 75; Wood & Anor v Inspector of Taxes Rev 1 [2006] EWCA Civ 26, para 24–27.
 
20
In Swedish Central Railway Co Ltd v Thompson (Inspector of Taxes) [1925] UKHL TC 9 342 Lord Cave said that “The central management and control of a company may be divided, and it may ‘keep house and do business’ in more than one place; and if so, it may have more than one residence.” In Koitaki Para Rubber Estates Ltd v FCT (1940) 6 ATD 42 Dixon J held that although a company may have more than one residence, such a finding should not be made unless the control of the general affairs of the company is divided or distributed amongst two or more countries.
 
21
Untelrab Ltd & Ors v McGregor (HMIT) (1995) Sp C 55, para 74.
 
22
OECD (2000), para 24.
 
23
Technical Advisory Group on Monitoring the Application of Existing Treaty Norms for the Taxation of Business Profits (2001).
 
24
OECD (2019b), para 23-24(1).
 
25
Oguttu (2008), p. 80; Elkins (2017), p. 219; Sharma and Das (2017), p. 268; Lincoln (2017), p. 359; Gerlach and Niemeyer (2018), p. 753; Australian Tax Office (2018).
 
26
See for example Bywater Investments Limited & Ors v Commissioner of Taxation; Hua Wang Bank Berhad v Commissioner of Taxation [2016] HCA 45.
 
27
O’Donovan et al. (2019).
 
28
FATF (2018a, b).
 
29
FATF (2019), para 32. Pocher (2020), p. 3.
 
30
See in general Paesano (2019).
 
31
See FATF (2021a, c).
 
32
These concepts are discussed in much greater detail in FATF (2021a).
 
33
FATF (2021a), para 48. FATF (2021c) para 56.
 
34
FATF (2019).
 
35
FATF (2019).
 
36
FATF (2019). FATF (2021c) para 59.
 
37
FATF (2019), para 46.
 
38
FATF (2019), para 47. FATF observed that they do not seek to regulate individual users who are not acting as VA service provider businesses but recognized that such users may still be subject to compliance obligations under a jurisdiction’s sanctions or enforcement framework.
 
39
FATF (2019), para 47.
 
40
FATF (2019), para 48.
 
41
FATF (2019), para 48, 68. FATF (2021c) para 82.
 
42
For a discussion of “business” in the context of Australian partnership law, see Egert (2007), p. 108; Hope v Bathurst City Council (1980) 144 CLR 1, 8–9; Pioneer Concrete Services Ltd v Galli [1985] VR 675, 705. FATF (2021a), par 51 explains that: “The phrase “as a business” is meant to separate those who may carry out a function on a very infrequent basis for non-commercial reasons from VASPs.”
 
43
FATF (2019), para 36.
 
44
FATF (2021a), para 33. FATF (2021c) para 86.
 
45
FATF (2021b), para 33.
 
46
FATF (2021b), para 33.
 
47
FATF (2012–2021), INR 15 n 36.
 
48
FATF (2019), para 78.
 
49
FATF (2019), para 79.
 
50
FATF (2021c) para 126 changed “a potential factor” in the last sentence to “one potential factor”.
 
51
FATF Guidance (2019), para 81. FATF (2021c) para 127.
 
52
See in general on jurisdictional challenges in e-commerce Jiménez and Lodder (2015), p. 266; Ward et al. (2016), p. 1.
 
53
FATF (2021c) para 127.
 
54
The Binance Terms of Use (as revised on 7 July 2021), for example, provide that when registering to use a Binance Account, a person represents and warrants among others that “you are neither a U.S. User nor an Ontario (Canada)-based User; nor are you acting on behalf of a U.S. User or Ontario (Canada)-based User.” The restrictions on Ontario-based users were introduced after the Ontario Securities Commission accused that crypto exchange of failing to comply with province regulations. See Reynolds (2021).
 
55
FATF (2019), para 80.
 
56
FATF (2019) para 80.
 
57
FATF (2019), para 83.
 
58
FATF (2019), para 83.
 
59
FATF (2019), para 87.
 
60
FATF (2021b), para 26.
 
61
FATF (2021b), para 25–31.
 
62
FATF (2020), para 59.
 
63
FATF (2021b), para 31.
 
64
FATF (2021b), para 31.
 
65
FATF (2020), para 34.
 
66
Coelho et al. (2021).
 
67
Coelho et al. (2021) para 30.
 
68
Coelho et al. (2021) para 43.
 
69
Partz, K (2021) Thai SEC and Cayman Islands regulator take action on Binance, 2 July 2021, Cointelegraph. https://​cointelegraph.​com/​news/​thai-sec-and-cayman-islands-regulator-take-action-on-binance.
 
70
Anti-Money Laundering and Counter-Terrorism Financing Act (2006) (Australia), Part 6A.
 
71
For control tests see the Social Security Act 1991 (Australia), s. 1207Q, read with of Anti-Money Laundering and Counter-Terrorism Financing Act (2006) (Australia), s. 11.
 
72
Also see AUSTRAC (2021) for its definition of “permanent establishment”. For tax purposes, section 6(1) of the Income Tax Assessment Act 1936 defines permanent establishment as: “a place at or through which the person carries on any business”. Without limiting the generality of the foregoing, the section lists a number of places that are included, for example, a place where the person is carrying on business through an agent; and a place where the person has, is using or is installing substantial equipment or substantial machinery, etc. It also lists a number of places that are excluded.
 
73
Australian Tax Office (2002), para 16.
 
74
OECD (2015, 2017). See also OECD (2016).
 
76
Salmon and Myers (2019), p. 6.
 
77
Australian Securities and Investments Commission v One Tech Media Ltd [2020] FCA 46.
 
78
FINTRAC (2015).
 
79
Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (2019). SOR/2019-240 https://​www.​moneylaundering.​com/​wp-content/​uploads/​2019/​07/​Canada.​FinalReg.​AML_​.​071019-1.​pdf.
 
80
FINTRAC (2021).
 
81
FINTRAC (2021), Annex 1.
 
82
FINTRAC (2021).
 
83
Regulations Amending Certain Regulations Made Under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2019, SOR/2019-240, Part B of Schedule 1.
 
84
Payment Services Act 59 of 2009 (Japan), art. 2(5); Financial Services Agency (2017).
 
85
Payment Services Act 59 of 2009 (Japan), art. 2(7).
 
86
Payment Services Act 59 of 2009 (Japan), art. 2(9).
 
87
Payment Services Act 59 of 2009 (Japan), art. 38.
 
88
Payment Services Act 59 of 2009 (Japan), art. 40.
 
89
De Nederlandsche Bank (2021).
 
90
Monetary Authority of Singapore (2020).
 
91
Payment Services Act 2 of 2019 (Singapore), s 6(8)(a).
 
92
Payment Services Act 2 of 2019 (Singapore), s 14.
 
93
The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (2017) (United Kingdom), Reg 54(1A), subject to transitional provisions for existing cryptoasset businesses, set out in Reg 56.
 
94
The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (2017) (United Kingdom), Reg 8(1).
 
95
Defined in the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (2017) (United Kingdom), Reg 6(5)(a) as a directive referred to in para 1 of Schedule 3 to the Financial Services and Markets Act 2000; Directive 2009/​110/​EC of the European Parliament and of the Council of 16th September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions; and Directive 2015/2366/EU of the European Parliament and of the Council of 25th November 2015 on payment services in the internal market.
 
96
The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations (2017) (United Kingdom), Reg 6(5)(a).
 
97
Transparency International UK (2017), p. 42.
 
98
Financial Conduct Authority (2021).
 
99
Russon (2021).
 
100
Munroe (1996), p. 304.
 
101
Securities and Exchange Commission (2019).
 
102
SEC v Telegram Inc and TON Issuer Inc 19 Civ. 9439 (PKC), Stipulation and proposed consent order, para 14. https://​riotblockchainre​viewed.​files.​wordpress.​com/​2019/​10/​riot-order-10-18-19.​pdf.
 
103
SEC v Telegram Inc and TON Issuer Inc 19 Civ. 9439 (PKC), Stipulation and proposed consent order, para 15. https://​riotblockchainre​viewed.​files.​wordpress.​com/​2019/​10/​riot-order-10-18-19.​pdf.
 
104
United States v. BTC-e a/k/a Canton Business Corporation and Alexander Vinnik, CR 16-00227 SI (N.D. CA. Jan. 17, 2017).
 
105
United States v. BTC-e a/k/a Canton Business Corporation and Alexander Vinnik, CR 16-00227 SI (N.D. CA. Jan. 17, 2017) Assessment of civil money penalty, p. 2.
 
106
United States v. BTC-e a/k/a Canton Business Corporation and Alexander Vinnik, CR 16-00227 SI (N.D. CA. Jan. 17, 2017) Assessment of civil money penalty, p. 2.
 
107
FinCEN (2021).
 
108
FinCEN (2021).
 
109
In the matter of HDR Global Trading Limited, 100x Holdings Limited, ABS Global Trading Limited, Shine Effort Inc. Limited, HDR Global Services (Bermuda) Limited ) d/b/a BITMEX, FinCEN, No 2021-02, 10 August 2021, p. 2.
 
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Metadaten
Titel
Where’s Wally? FATF, Virtual Asset Service Providers, and the Regulatory Jurisdictional Challenge
verfasst von
Louis de Koker
Talha Ocal
Pompeu Casanovas
Copyright-Jahr
2022
Buch
Financial Technology and the Law

Print ISBN: 978-3-030-88035-4

Electronic ISBN: 978-3-030-88036-1

Copyright-Jahr: 2022

DOI
https://doi.org/10.1007/978-3-030-88036-1_7