Solomon Islands -- Travel Rule Implementation Regulatory Overview

Based on the most recent publicly available information, the Solomon Islands has not yet adopted or implemented the FATF Travel Rule.

Here's a breakdown of the status:

1. Whether Adopted & Effective Date:

   • Not Adopted: The Solomon Islands does not have a specific regulatory framework for Virtual Assets (VAs) or Virtual Asset Service Providers (VASPs). Consequently, the FATF Travel Rule (Recommendation 16, as applied to VASPs under Recommendation 15) has not been adopted or made effective.
   • The Asia/Pacific Group on Money Laundering (APG) Mutual Evaluation Report for the Solomon Islands, published in August 2019, clearly states that the Solomon Islands "has not yet assessed the ML/TF risks associated with virtual assets (VAs) and virtual asset service providers (VASPs) within the jurisdiction" and that there is "no specific legislation or regulation relating to VASPs." Recommendation 15 (New Technologies) was rated as "Non-Compliant" (NC).
   • Further reinforcing this, the Central Bank of Solomon Islands (CBSI) issued a Public Notice on 26th July 2021 warning the public about the risks associated with cryptocurrencies. The notice stated that cryptocurrencies are "not legal tender in Solomon Islands," "unregulated," and "not recognized by CBSI as a regulated financial product or service."

2. Threshold Amounts:

   • Since there is no regulatory framework for VASPs or the Travel Rule, there are no established threshold amounts for information exchange in the Solomon Islands.

3. Which VASPs are Covered:

   • As there is no specific legislation or regulation covering VASPs, no VASPs are formally covered under a VASP-specific AML/CFT regime, nor are they subject to the Travel Rule.

4. Technical Implementation Requirements:

   • Given the absence of a regulatory framework for VASPs and the Travel Rule, there are no specified technical implementation requirements for VASPs in the Solomon Islands.

5. Penalties for Non-Compliance:

   • Because the Travel Rule has not been adopted into law, there are no specific penalties for non-compliance with the Travel Rule in the Solomon Islands.
   • However, operating any unregulated financial service carries inherent risks, and any entity found to be facilitating money laundering or terrorist financing through virtual assets, if such activities were ever investigated and proven, would likely fall under the general provisions of the Solomon Islands Anti-Money Laundering and Counter-Terrorist Financing Act 2002 (as amended). But this would be for the underlying crime, not for VASP-specific regulatory non-compliance.

Summary:

The Solomon Islands is still in the very early stages regarding virtual asset regulation. As of the latest reports and public notices, it has not yet developed a framework to address the risks of virtual assets or to regulate VASPs, and therefore, the FATF Travel Rule has not been adopted or implemented.

References:

• APG Mutual Evaluation Report for Solomon Islands (August 2019):

  • Specifically, see the ratings for Recommendations 15 and 16, and the detailed analysis regarding virtual assets.
  • Link to APG website for Solomon Islands reports (you may need to navigate to the latest MER): APG Mutual Evaluation Reports
  • Direct link to the 2019 MER document: https://www.apgml.org/documents/documents/38/Solomon%20Islands%20MER_August%202019%20FINAL.pdf (Refer to page 54, "Recommendation 15 – New Technologies," and page 56, "Recommendation 16 – Wire Transfers," in the context of VASPs.)

• Central Bank of Solomon Islands (CBSI) Public Notice on Cryptocurrencies (26th July 2021):

  • Link to CBSI website, News & Announcements section (you may need to search or navigate to the relevant date): CBSI News & Announcements
  • A direct link to the notice might be harder to find as CBSI often updates their site, but it was widely reported in local media at the time. (Example reporting: https://www.sibconline.com.sb/cbsi-warns-public-on-cryptocurrencies/)

• Anti-Money Laundering and Counter-Terrorist Financing Act 2002 (as amended):

  • This is the general AML/CFT legislation, which would likely need amendment to specifically include VASPs and the Travel Rule.
  • Access to the specific consolidated act text may require legal databases, but its existence is widely known.