Tunisia

Cryptocurrencies are not recognized as legal tender in Tunisia.

Transactions involving cryptocurrencies are not authorized by the BCT.

The BCT highlights the risks associated with virtual assets, including volatility, lack of consumer protection, money laundering, and financing of terrorism.

**Exchanges:** There is no legal framework allowing the operation of crypto exchanges. Any attempt to operate one would be in violation of the BCT's stance and existing financial laws.

**Custody Providers:** Similarly, no specific license exists. Providing custody for virtual assets would fall into the same regulatory void/prohibition.

**Payment Processors:** Companies processing payments *in* or *with* cryptocurrencies would face the same regulatory hurdles as exchanges. Traditional payment service provider licenses (issued by the BCT for fiat currencies) would not extend to virtual assets given their non-recognition.

**Capital Requirements:** Substantial minimum capital requirements to ensure financial stability and cover operational risks.

**AML/KYC Compliance:** Strict Anti-Money Laundering (AML) and Know Your Customer (KYC) policies and procedures, in line with international standards (FATF recommendations). This would include customer identification, transaction monitoring, suspicious activity reporting to the **Commission Tunisienne des Analyses Financières (CTAF)** (Tunisia's Financial Intelligence Unit).

**Local Presence:** A physical presence in Tunisia, including a local registered office, and potentially local management and staff.

**Governance and Risk Management:** Robust internal governance, risk management frameworks, IT security measures, and business continuity plans.

**Fit and Proper Requirements:** For management, board members, and significant shareholders.

**Consumer Protection:** Measures to protect users' funds and data.

**Banque Centrale de Tunisie (BCT) Official Website:**

**Relevance:** The BCT is the primary monetary authority. You would need to monitor their press releases, circulars, and official communications sections for any updates or explicit statements regarding virtual assets. Historically, they have issued warnings about the risks of cryptocurrencies and their non-recognition as legal tender. Searching their site for terms like "cryptomonnaies," "monnaies virtuelles," or "actifs virtuels" (French for cryptocurrencies, virtual currencies, virtual assets) would yield their current stance.

**Commission Tunisienne des Analyses Financières (CTAF) - Tunisia's FIU:**

**Relevance:** While the CTAF primarily deals with AML/CFT for traditional financial institutions, any future regulation of virtual assets would certainly place them under the purview of the CTAF for AML/CFT compliance. Their site provides information on Tunisia's AML/CFT framework, which would be foundational for any regulated financial activity.

**Investment Tokens/Security Tokens (STOs):** Tokens that are offered to raise capital for a project or company, where investors expect a financial return (e.g., profit sharing, dividends, interest, or appreciation in value) based on the issuer's performance or assets.

**Equity Tokens:** Tokens that represent ownership stakes in a company, granting rights similar to traditional shares (e.g., voting rights, dividend rights, liquidation rights).

**Debt Tokens:** Tokens that represent a loan made to an issuer, entitling the holder to principal repayment and/or interest payments.

**Tokens Linked to Tangible Assets:** Tokens representing fractional ownership of real estate, commodities, or other assets, where the value and potential returns are tied to the underlying asset and managed by the issuer.

**Payment Tokens/Cryptocurrencies (e.g., Bitcoin, pure Ether):** Tokens primarily functioning as a medium of exchange, unit of account, or store of value, without being issued by a specific entity to fund a venture with an expectation of profit from that entity's efforts. The Central Bank of Tunisia (BCT) has, however, issued strong warnings against the use of these cryptocurrencies due to their unregulated nature, volatility, and risks (e.g., money laundering, terrorist financing).

**Pure Utility Tokens:** Tokens that solely grant access to a specific product or service on a blockchain network, where their value is tied to their utility within that ecosystem, and there is no primary investment expectation of profit from the issuer's efforts.

**Public Offering (Issuance to the Public):**

**CMF Approval:** Issuers must obtain prior authorization from the CMF for any public offering of securities.

**Prospectus Requirement:** A detailed prospectus must be prepared and approved by the CMF. This prospectus must contain comprehensive information about the issuer, the project, the financial health of the issuer, the characteristics of the tokens, the risks involved, and how the proceeds will be used.

**Licensing:** Issuers and any intermediaries involved in the offering (e.g., financial advisors, placement agents) must be licensed by the CMF.

**Corporate Governance:** The issuer must comply with relevant corporate governance and transparency rules.

While not requiring the full public offering prospectus, private placements (offerings to a limited number of qualified investors) would still be subject to general anti-fraud provisions of securities law and potentially other notification requirements to the CMF. The exact thresholds and definitions of "private placement" versus "public offering" are defined in Tunisian law.

**Regulated Market:** If a security token is to be traded on a regulated secondary market (e.g., a stock exchange or a regulated multilateral trading facility), it would need to be listed on such a market and comply with all applicable rules and regulations of that market and the CMF. This includes transparency requirements, continuous disclosure obligations, market abuse rules, and investor protection measures.

**Over-the-Counter (OTC) Trading:** Unlicensed OTC trading of security tokens would generally be prohibited. Any entity facilitating secondary trading of security tokens would likely need to be licensed by the CMF as a financial intermediary.

**General Warnings:** The Central Bank of Tunisia (BCT) has repeatedly issued warnings to the public about the risks associated with investing in, transacting with, or holding cryptocurrencies like Bitcoin. These warnings typically highlight the lack of legal tender status, absence of regulatory oversight, high volatility, and risks of fraud, money laundering, and terrorist financing.

**Prohibition of Payment/Exchange:** The BCT's stance effectively prohibits licensed financial institutions from dealing with cryptocurrencies and restricts individuals from using them for payments or exchange through regulated channels. This is more related to monetary policy, financial stability, and AML/CFT concerns rather than specific securities regulation of tokens.

The market for such offerings in Tunisia is either very nascent or non-existent through formal channels.

Authorities might be taking a cautious "wait and see" approach for innovative blockchain applications while prioritizing stability and consumer protection.

Any potential issues might be handled through administrative warnings or informal measures rather than public prosecutions.

**Law No. 94-117 of November 14, 1994, on the Reorganization of the Financial Market:** This is the cornerstone legislation. It's often available in French on Tunisian legal resource websites.

While a direct official English translation link is hard to find, the official French text can be sought on sites like Jurisite Tunisia (jurisitetunisie.com) by searching for "Loi n° 94-117 du 14 novembre 1994."

**Conseil du Marché Financier (CMF) - Official Website:** The primary regulator for securities.

https://www.cmf.tn/ (Content primarily in French and Arabic)

**Central Bank of Tunisia (BCT) - Official Website:** The BCT issues warnings and guidance regarding general cryptocurrency risks. Look for press releases or circulars concerning digital assets.

https://www.bct.gov.tn/ (Content primarily in French and Arabic)

**Compliance Requirement:** Tunisia is legally bound to implement UN Security Council (UNSC) resolutions that impose targeted financial sanctions. These primarily relate to counter-terrorism (e.g., against Al-Qaida, ISIL/Da'esh affiliates) and counter-proliferation of weapons of mass destruction. All financial institutions, including VASPs (once explicitly regulated or by analogy), must freeze assets and prevent funds/services from being made available to designated individuals and entities on the UN Consolidated Sanctions List.

**Legal Basis:** UN Security Council Resolutions, particularly those under Chapter VII of the UN Charter (e.g., Resolution 1267 (Al-Qaida/ISIL), 1373 (general counter-terrorism), 1718 (DPRK), 2231 (Iran). Tunisia incorporates these into its national law.

UN Security Council Sanctions Committees: https://www.un.org/securitycouncil/sanctions/information

UN Consolidated Sanctions List: https://www.un.org/securitycouncil/content/un-sc-consolidated-list

**Compliance Requirement:** The FATF sets international standards for combating money laundering and terrorist financing. Tunisia, through its membership in MENAFATF, is assessed on its adherence to these recommendations. Recommendation 15 specifically addresses virtual assets and VASPs, requiring countries to regulate and supervise VASPs for AML/CFT purposes, including implementing targeted financial sanctions. VASPs are expected to conduct customer due diligence (CDD), monitor transactions, report suspicious activities, and screen against sanctions lists. The FATF "Travel Rule" (Recommendation 16) also applies to VASPs.

**Tunisia's Status:** The MENAFATF's 2019 Mutual Evaluation Report (MER) for Tunisia highlighted that Tunisia needed to adopt legislative and regulatory measures to apply the FATF Recommendations to virtual assets and VASPs. While progress has been made, the underlying AML/CFT obligations apply.

**Legal Basis:** FATF Recommendations (updated regularly).

MENAFATF Mutual Evaluation Report of Tunisia (2019): https://www.menafatf.org/sites/default/files/FATF-MENAFATF_Mutual_Evaluation_Report_Tunisia_2019.pdf (See Section 7 on New Technologies and VASPs, specifically page 27 for Recommendation 15).

**EU Sanctions & OFAC Sanctions (US):**

**Compliance Requirement:** While not directly binding on Tunisian entities *unless* they have a nexus to the EU or US jurisdiction (e.g., an EU-based branch, US dollar transactions, or US persons as clients), EU and OFAC sanctions lists are critical for Tunisian VASPs engaged in international operations. Many global financial institutions and partners will de-risk if a VASP does not demonstrate compliance with these broader lists. VASPs often screen against these lists as a best practice to mitigate financial crime risks and maintain correspondent banking relationships.

EU Restrictive Measures (Sanctions): https://www.consilium.europa.eu/en/policies/sanctions/

OFAC Specially Designated Nationals (SDN) List: https://www.treasury.gov/ofac/downloads/sdnlist.txt

**Law No. 2015-26 on Combating Money Laundering and Terrorist Financing (as amended):** This is the cornerstone legislation. It establishes the framework for identifying, reporting, and prosecuting money laundering and terrorist financing. It requires obliged entities to:

Conduct customer due diligence (KYC).

Monitor transactions for suspicious activity.

Report Suspicious Transaction Reports (STRs) to the Tunisian Financial Analysis Committee (CTAF).

Implement targeted financial sanctions as per UN resolutions.

**Current Status regarding Crypto:** While the law provides a general framework, specific regulations explicitly defining VASPs and their precise obligations under this law were still being developed as of the 2019 FATF MER. However, the principles of AML/CFT, including sanctions compliance, are expected to apply.

**Reference:** This law is published in the Journal Officiel de la République Tunisienne (JORT). Specific English translations might be available via legal databases or local counsel.

**Tunisian Financial Analysis Committee (CTAF - Comité Tunisien des Analyses Financières):**

**Role:** The CTAF is Tunisia's Financial Intelligence Unit (FIU). It is responsible for receiving, analyzing, and disseminating STRs, and for issuing guidance to obliged entities on AML/CFT compliance, including sanctions screening.

**Reference:** CTAF website (information might be primarily in Arabic/French): https://www.ctaf.gov.tn/

**Primary Obligation:** Screen all customers and beneficial owners against the **UN Consolidated Sanctions List**. This is a direct legal requirement stemming from Tunisia's UN obligations.

**Recommended Best Practice:** For global market access and de-risking, VASPs should also screen against:

**OFAC Specially Designated Nationals (SDN) List and other OFAC lists.**

**FATF High-Risk Jurisdictions subject to a Call for Action (Blacklist) and Jurisdictions under Increased Monitoring (Greylist).**

**Methodology:** Screening should occur during onboarding (KYC), periodically, and for real-time transaction monitoring. This involves checking names, aliases, dates of birth, addresses, and other identifying information against sanctions databases.

**Sanctioned Jurisdictions:** Countries that are subject to comprehensive UN, OFAC, or EU sanctions (e.g., North Korea, Iran in certain contexts, Syria, Cuba).

**FATF High-Risk Jurisdictions:** Jurisdictions identified by the FATF as having strategic deficiencies in their AML/CFT regimes. Dealing with these jurisdictions carries heightened risk and may trigger enhanced due diligence requirements.

**Fines:** Significant monetary penalties for institutions and individuals.

**Imprisonment:** Individuals responsible for non-compliance (e.g., management, compliance officers) may face terms of imprisonment.

**Administrative Sanctions:** These can include revocation of licenses, prohibition from conducting business, and other regulatory measures imposed by the CTAF or other supervisory bodies.

**Reputational Damage:** Non-compliance can severely damage a VASP's reputation and its ability to operate globally or secure partnerships.

**Regulator Name:** While the Central Bank of Tunisia (BCT) defines the regulatory environment, the enforcement was carried out by the Tunisian judicial system (police and courts) based on existing financial laws.

**Entity Targeted:** Iskander Najar (also sometimes reported as Islem Najar), a young Tunisian individual.

**Violation Type:** Illegally using cryptocurrency to transfer money abroad, violating Tunisian foreign exchange laws (specifically, the prohibition on non-authorized transfers of foreign currency) and potentially money laundering charges.

**Penalty Amount:** Initial sentence of two years in prison and a fine of 5,000 Tunisian Dinars (TND) (approximately $1,700 at the time). This sentence was later reduced on appeal. Specific details of the reduced fine are less widely reported than the prison sentence reduction.

**Date:** Arrest occurred in early 2021. An initial sentence was delivered in March 2021. Appeals and subsequent rulings continued into 2022.

**Outcome:** Najar was convicted and served time in prison. The case garnered significant international attention, with many advocating for his release and highlighting the severity of Tunisia's stance on crypto. His sentence was ultimately reduced on appeal, and he was released after serving part of his term. The outcome reinforced Tunisia's strict interpretation of its foreign exchange laws concerning digital assets.

**Al Jazeera (March 2021):** Tunisia jails man for using Bitcoin to transfer money

**Middle East Eye (March 2021):** Tunisia jails student for using Bitcoin to transfer money abroad

**Bloomberg (April 2021, discusses the wider context):** Tunisia Says Jailed Bitcoin User Violated Exchange Rules

**Access Now (July 2021, update on appeal):** Tunisia: Imprisoned Bitcoin user’s appeal postponed as calls for release grow