Algeria -- Travel Rule Implementation Regulatory Overview

Algeria has a unique status regarding the FATF Travel Rule: it has not implemented it in the traditional sense because cryptocurrencies and related activities are largely prohibited by law within the country.

Here's a breakdown of the situation:

• Overall Status: Algeria has adopted a prohibitionist approach to virtual assets (VAs) rather than a regulatory one. Therefore, the FATF Travel Rule (Recommendation 16) is not implemented for Virtual Asset Service Providers (VASPs) within Algeria, as such entities are not permitted to operate.

• Whether Adopted: No, the FATF Travel Rule has not been adopted for VASPs in Algeria because VASPs are not permitted to operate. Instead, Algeria has opted to prohibit virtual assets.

• Effective Date of Prohibition: The prohibition on cryptocurrencies and their use stems from Law No. 18-05 of 2018 (Finance Law 2018), specifically Article 114, which came into effect on January 1, 2018.

  • Reference: While an official English translation with a direct URL from the Algerian government may be difficult to obtain, the prohibition is widely cited and confirmed by international bodies like the FATF.

• Threshold Amounts: Not applicable. Since virtual asset activities and VASPs are prohibited, there are no regulated thresholds for information sharing under the Travel Rule.

• Which VASPs are Covered: None are legally covered, as VASPs are not permitted to operate or be established in Algeria.

• Technical Implementation Requirements: Not applicable. There are no technical requirements for Travel Rule implementation in Algeria due to the ban.

• Penalties for Non-Compliance (i.e., for violating the ban):

  • Nature of Penalties: Individuals or entities engaged in virtual asset activities in violation of the law may face significant legal penalties, including fines and imprisonment, as these activities are considered illegal.

  • Specific Legislation: The penalties would fall under the broader framework of financial crimes and unauthorized financial operations as defined in Algerian law, primarily stemming from the directives of the Banque d'Algérie (Central Bank of Algeria) and the provisions of Law No. 18-05 of 2018.

  • FATF Mutual Evaluation Report Confirmation: The Financial Action Task Force (FATF) confirmed Algeria's stance in its Mutual Evaluation Report (MER). The MER noted that "Algeria has not authorized the operation of VASPs, nor the use or exchange of VAs in its territory." The report concluded that Algeria addresses the risks associated with VAs by prohibiting them.

  • Reference:

    • FATF Mutual Evaluation Report of Algeria (November 2022): This report provides an authoritative assessment of Algeria's AML/CFT framework, including its approach to virtual assets. It explicitly states the prohibition.
    • URL: https://www.fatf-gafi.org/content/fatf-gafi/en/countries-regions/Algeria/documents/mer-Algeria-2022.html
    • Specifically, refer to Recommendation 15 (New technologies) and Recommendation 16 (Wire transfers) in the MER's technical compliance and effectiveness ratings for details on their approach to virtual assets.

In summary, for practical purposes, the FATF Travel Rule is not "implemented" in Algeria because the underlying virtual asset activities it seeks to regulate are explicitly banned. Any engagement in crypto activities by individuals or businesses within Algeria would be in contravention of national law, leading to severe penalties.