Jordan -- Travel Rule Implementation Regulatory Overview

Jordan has taken steps to implement the FATF Travel Rule through its regulatory framework for virtual assets.

Here's a breakdown of the status:

• Adopted? Yes, Jordan has adopted measures consistent with the FATF Travel Rule. The primary instrument for this is Central Bank of Jordan (CBJ) Circular No. 10/2022, titled "Instructions for Licensing and Supervising Virtual Assets and Virtual Asset Service Providers." These instructions build upon the broader Anti-Money Laundering and Counter-Terrorist Financing Law No. 20 of 2021.

• Effective Date: CBJ Circular No. 10/2022 was issued and became effective on June 1, 2022.

• Threshold Amounts: While the FATF Travel Rule recommends thresholds for information transmission (USD/EUR 1,000 for cross-border transfers and USD/EUR 3,000 for domestic transfers), the CBJ Circular No. 10/2022 generally requires comprehensive AML/CFT measures, including the collection of originator and beneficiary information, for all virtual asset transactions conducted by licensed VASPs, effectively operating with a zero threshold for information collection for AML/CFT purposes. For the transmission of this information between VASPs as per the Travel Rule, the implicit expectation is to align with FATF's recommended thresholds or apply it more broadly where relevant.

• Which VASPs are Covered? CBJ Circular No. 10/2022 explicitly covers "Virtual Asset Service Providers" (VASPs) operating within or from Jordan. This definition typically aligns with FATF recommendations and includes entities involved in:

  • Exchanging between virtual assets and fiat currencies.
  • Exchanging between one or more forms of virtual assets.
  • Transfer of virtual assets.
  • Safekeeping and/or administration of virtual assets or instruments enabling control over virtual assets.
  • Participation in and provision of financial services related to an issuer's offer and/or sale of a virtual asset.

• Technical Implementation Requirements: The Circular mandates that licensed VASPs must establish and maintain robust Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) programs. For the Travel Rule, this specifically requires VASPs to:

  • Collect required information: Obtain and hold accurate and meaningful originator information and required beneficiary information for virtual asset transfers.
  • Transmit required information: Submit the required originator and beneficiary information to the beneficiary VASP (or to the originator VASP in the case of a receipt).
  • Verify information: Conduct verification of customer identity as part of their Customer Due Diligence (CDD) process.
  • Record-keeping: Maintain records of all transaction information and CDD data for a specified period (typically 5-10 years).
  • Monitor and report: Implement systems for ongoing monitoring of transactions and reporting of suspicious transactions (STRs) to Jordan's Anti-Money Laundering and Counter-Terrorist Financing Unit (AMLCFTU).
  • Interoperability: While the Circular doesn't specify particular technical solutions (like TRISA, Sygna, Travel Rule Protocol), VASPs are expected to adopt solutions that enable secure, reliable, and compliant transmission and receipt of required Travel Rule data.

• Penalties for Non-Compliance: Non-compliance with AML/CFT obligations, including those stemming from the Travel Rule, can lead to severe penalties under Jordan's Anti-Money Laundering and Counter-Terrorist Financing Law No. 20 of 2021 and the CBJ's regulatory powers. These may include:

  • Administrative Sanctions: Monetary fines, warnings, suspension or revocation of licenses/permits, restrictions on operations.
  • Criminal Charges: For serious breaches or involvement in money laundering or terrorist financing activities, individuals and entities can face imprisonment and substantial financial penalties as prescribed by the AML/CFT Law. The CBJ has the authority to refer such cases to the relevant judicial authorities.

References:

1. Central Bank of Jordan (CBJ) Circular No. 10/2022:

   • While a direct English version of the circular might not be readily available on the CBJ's public website, news outlets and legal analyses often refer to it. The CBJ's website provides general information on its regulatory role:
     • Central Bank of Jordan Official Website (Navigation might be required to find specific circulars, which are often published in Arabic).
   • Example of legal analysis referencing the circular:
     • Al Tamimi & Company Legal Update: Jordan Regulates Virtual Assets and Virtual Asset Service Providers (Provides a summary and interpretation of Circular 10/2022)

2. Anti-Money Laundering and Counter-Terrorist Financing Law No. 20 of 2021:

   • This is the overarching AML/CFT legislation in Jordan. While an official English translation link can be hard to find publicly, legal databases often contain it.
   • Reference point: The law establishes the legal framework for combating money laundering and terrorist financing, granting powers to the AMLCFTU and relevant supervisory authorities like the CBJ.

3. FATF Recommendations:

   • For background on the Travel Rule itself:
     • FATF Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers (June 2021 Update)

It is recommended for VASPs operating in Jordan to consult directly with Jordanian legal counsel specializing in financial regulations to ensure full compliance with the most current laws and instructions.