On-shore VASP in Liberia

Registration/Licensing: While specific VASP regulations in Liberia are evolving, the FATF recommendations require VASPs to be licensed or registered.

Act of the Legislature to Amend and Restate the Act Adopting a New Anti-Money Laundering and Countering the Financing of Terrorism Act of 2012 (AML/CFT Act of 2012, as amended): This is the primary legislation governing AML/CFT in Liberia. It establishes the legal framework for identifying, reporting, and prosecuting money laundering and terrorist financing. While it might not explicitly mention "virtual assets" or "VASPs" by name in its original form, its broad definitions of "funds," "financial institutions," and "designated non-financial businesses and professions" (DNFBPs) are often interpreted to cover virtual asset activities.

Financial Intelligence Unit of Liberia (FIUL) Act: This act establishes the FIUL as the central agency for receiving, analyzing, and disseminating suspicious transaction reports (STRs) and other financial intelligence.

Customer Due Diligence (CDD) & Enhanced Due Diligence (EDD): VASPs must conduct CDD on all customers, including identifying and verifying the identity of the customer and beneficial owners. EDD is required for high-risk customers or transactions.

Record-Keeping: Maintain records of all transactions and customer information for a prescribed period.

Transaction Monitoring: Implement systems to monitor transactions for suspicious activity.

Suspicious Transaction Reporting (STRs): Report any suspicious transactions or activities, including those related to sanctioned entities or geographic areas, to the FIUL.

Sanctions Compliance: Implement robust systems and controls to ensure compliance with UN, OFAC, and EU sanctions lists, including screening customers and transactions.

Continuous Screening: Implement ongoing screening of all customers, beneficial owners, and associated parties against up-to-date UN, OFAC, and EU sanctions lists.

Risk-Based Approach: Implement a risk-based approach to AML/CFT, allocating resources proportionally to the identified risks.

Compliance Requirement for VASPs: VASPs must screen all their customers and transactions against the UN Consolidated Sanctions List (e.g., ISIL (Da'esh) & Al-Qaida Sanctions List, DPRK Sanctions List, etc.) to identify any sanctioned parties or activities.

U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) Sanctions: While OFAC sanctions are primarily U.S. law, their extraterritorial reach (especially through the U.S. financial system) means that any VASP or financial institution anywhere in the world that engages in transactions involving a U.S. person, U.S. dollar, or U.S. technology must comply. Non-compliance can lead to severe penalties and loss of access to the U.S. financial system.

European Union (EU) Sanctions: EU sanctions are binding on persons and entities within EU jurisdiction, but like OFAC, they have a significant global impact due to the EU's economic power.

No specific custodial license for digital assets currently exists. Any entity in Liberia offering digital asset custody services would likely operate in a regulatory gray area or might be indirectly subject to general financial services licensing if its activities are deemed to fall under existing financial institution definitions (e.g., as a payment service provider or financial intermediary), but this would not be crypto-specific.

No specific rules exist for the segregation of client digital assets. In traditional finance, robust segregation rules protect client funds from institutional insolvency. Without a specific framework for digital assets, such rules are absent.

No specific mandates for cold storage or other technical security requirements for digital asset custody. This level of technical detail in regulation is characteristic of more mature crypto regulatory frameworks, which Liberia does not yet possess.

No specific definition of a "qualified custodian" for digital assets. This term typically arises in jurisdictions where registered investment advisors or other regulated entities are required to hold client assets with a "qualified custodian," usually a regulated bank or trust company meeting specific criteria.

No specific insurance or bonding requirements for digital asset custodians. Traditional financial institutions might have deposit insurance (e.g., through the Liberia Deposit Insurance Corporation, LDIC) or capital requirements, but these do not extend to digital asset holdings.

CBL Laws & Regulations Page: Look for "Laws and Regulations" or "Legal Framework" on their site. An older version of the Act can often be found, for example, under publications like https://www.cbl.org.lr/doc/CBL%20Act%201999%20Amended%202011.pdf (Note: Always check the CBL website for the most current version).

No, not specifically for Virtual Assets (VAs) and Virtual Asset Service Providers (VASPs). The 2021 FATF MER explicitly states that Liberia "has not yet assessed its money laundering and terrorist financing risks relating to virtual assets and VASPs, and has not yet put in place the necessary legal or regulatory framework for VAs and VASPs as required by Recommendation 15."

No specific category of VASPs is currently covered by AML/CTF obligations or Travel Rule requirements in Liberia, due to the lack of a comprehensive legal and regulatory framework for VAs/VASPs. The FATF MER highlights that Liberia has not identified or licensed any VASPs operating in its jurisdiction, nor has it applied AML/CTF requirements to them.

FATF Mutual Evaluation Report of Liberia (October 2021):

The standard GST rate in Liberia is 10%.

Services Related to Crypto: Services provided in relation to cryptocurrency (e.g., exchange fees charged by a Liberian-based crypto exchange, consulting services on blockchain technology, transaction processing fees) would likely be subject to GST if the service provider is registered for GST and meets the taxable supply threshold.

Liberia does impose capital gains tax. The general rate for capital gains from the sale of assets (including shares and other non-real estate assets) has historically been around 15% to 20%. However, specific rules can apply depending on the asset type and whether it's an individual or a corporation.

Taxable Event: A capital gains event typically occurs when crypto is:

Airdrops, Staking Rewards, Lending Income: These are generally considered income events. The fair market value in LRD at the time of receipt would likely be taxable as ordinary income.