Several years back the Government of St Vincent & The Grenadines (“SVG”) passed a Virtual Service Provider Act.
The Act however, hitherto, had been impotent in that, like a bullet train with no track to run on, the SVG Govt had not been able to find the brainpower or the wherewithal to pass the Regulations that would enable Crypto Startups to actually apply for a VASP License in SVG as contemplated by the Legislation.
The SVG Financial Services Authority (the “Authority”) has now formally advised us (as of 30 May 2025) that pursuant to the Virtual Asset Business Act No. 9 of 2022, (the “VABA”) as amended, the application process for the registration of virtual asset businesses in or from within Saint. Vincent and the Grenadines will formally commence from June 2nd 2025.
Registration Requirements:
Entities engaged in virtual asset services, as defined under the VABA, are required to register with the Authority. This includes services such as:
1. Exchange between virtual assets and fiat currencies;
2. Exchange between different types of virtual assets;
3. Transfer of virtual assets;
4. Custody or administration of virtual assets or instruments enabling control over virtual assets;
5. Participation in and provision of financial services related to an issuer’s offer or sale of a virtual asset.
Application Process:
Applicants are required to submit the application form along with the necessary documentation and application fee of EC$4,000.
A successful application will result in the requirement of a registration fee of EC$12,000. A statutory deposit of EC$100,000 or an amount equal to twenty-five percent of the financial obligations to clients of the registrant, whichever is greater, in cash, government securities or in any other form approved by the Minister.
Annual License Renewal Fee to be paid to the government is EC$12,000.
($US1 = EC$2.69)
The application form, a copy of the regulations and a useful checklist can be accessed via these Links:
The Draft Regulations: https://www.dropbox.com/scl/fi/89a8a3l7kdsm123f7uqgb/Draft-Virtual-Asset-Business-Regulations-2025.pdf?rlkey=7opf1lygiu54nctx4na57nqd0&st=3neo3y79&dl=0
The Govt Application Form: https://www.dropbox.com/scl/fi/b7uujrepiv1msy5e4obev/VAB-Application-Form-Final.pdf?rlkey=0zad9rximmd9cobcydj2u5dvc&st=aqwmhy6m&dl=0
SVG VASP License Application Checklist: https://www.dropbox.com/scl/fi/d5ppq2uest8e7381ot9h1/Virtual-Assets-Business-Application-Checklist-Final.pdf?rlkey=s0903em92ct13l6rw8u0awbfq&st=jqozpdnx&dl=0
Regulations and Guidance on the ongoing requirements and obligations of registrants will follow.
Legislative Recap
Virtual Asset Business Act, 2022
This VABA introduced a comprehensive regulatory framework for virtual asset business activities conducted in or from within Saint Vincent and the Grenadines. The VABA sets out the requirements for registration, compliance, supervision, and ongoing obligations for entities engaged in virtual asset business including virtual asset service providers (VASPs). A copy of the Act can be accessed via this Link: https://www.dropbox.com/scl/fi/9vz6851tanfytj8ux8fsz/Virtual-Asset-Act-2022.pdf?rlkey=6lzhzbom7ga72cu04v53lr8wr&st=afcr7pvq&dl=0
Virtual Asset Business (Amendment) Act, 2025
On April 28th, 2025 the Act was amended to update and clarify certain provisions of the VABA.
The key amendments are as follows:
Commencement date: The Amendment Act sets out the date for the commencement of the Act and makes it clear that the Act comes into force on the 31st day of May, 2025.
Proof of Incorporation (Section 6(3)(d)): The amendment clarifies that applicants for registration must provide proof of incorporation or formation under either the SVG:
▪ Business Companies (Amendment and Consolidation) Act, or
▪ Limited Liability Companies Act.
Regulatory Compliance References (Sections 18(1)(a) & 19(1)(d)): The language is expanded to include not just the Act, but also Regulations made under it, ensuring that regulatory obligations apply broadly across both the Act and any subordinate legislation.
Final draft of Regs: The Regulations are expected to be approved without further amendments
Transitional Period: In accordance with the Act, all existing entities currently engaged in virtual asset activities, including those incorporated as Limited Liability Companies (LLCs) or Business Companies (BCs) engaged in virtual asset or related business, are required to submit an application for registration to the Authority within thirty (30) days of the coming into force of the Act, that is, by July 31, 2025. Entities that fail to apply within the prescribed period will be subject to an administrative striking off.
External Auditor Requirements
Licensed virtual asset businesses must appoint a qualified external auditor annually. Accepted qualifications include:
- Chartered Accountants
- Certified Public Accountants
- Members of regional accounting bodies
- Other professionally recognized accountants approved by the regulator
Key Auditor Responsibilities Include:
- Reviewing financial records and preparing audited annual financial statements
- Assessing the effectiveness of internal controls and risk management
- Evaluating AML/CFT compliance measures
- Reporting any significant regulatory breaches or suspicious transactions
- Audited financial statements must be submitted within a set timeframe following the financial year-end.
Fit and Proper Requirements
All individuals in significant roles—including directors, executives, beneficial owners, and senior officers—must meet fit and proper criteria. The assessment areas include:
- Financial soundness and stability
- Educational background and relevant industry experience
- Good reputation and high standards of integrity
- Absence of conflicts of interest
- Ethical history in professional and business conduct
Disqualifying Factors include:
- Previous involvement in fraud or dishonesty
- Poor compliance history or regulatory sanctions
- Bankruptcy, insolvency, or ongoing financial judgments
- Employment history suggesting misconduct or mismanagement
Applicants should be prepared to provide documentation supporting the suitability of all key individuals.
Capital Requirements and Statutory Deposit
To ensure financial resilience and protect client interests, licensed businesses must maintain a statutory deposit with the Regulator. The required amount is based on either a fixed minimum or a percentage of client obligations, whichever is higher. Accepted Deposit Forms include:
- Cash holdings
- Government-issued securities
- Other approved financial instruments
Additional capital or liquidity requirements may be imposed, depending on the business’s risk exposure, operational complexity, and size.
Local Staffing and Operational Presence
Virtual asset businesses operating from outside SVG are required to appoint a Principal Representative who is ordinarily resident in SVG. Responsibilities of the Principal Representative include:
- Overseeing daily operations in the jurisdiction
- Acting as liaison between clients, affiliates, and the Regulator
- Submitting regulatory filings and updates
- Advising on compliance matters and responding to official inquiries
Staffing and Technology Expectations include:
- Adequately trained and experienced staff
- Technology infrastructure that supports operational integrity
- Security protocols that protect client data and ensure confidentiality
- All staff must also meet fit and proper standards.
Additional Compliance Obligations
Beyond licensing and staffing, SVG’s regulatory framework outlines several other critical compliance obligations including the following Registration Disclosures:
- Applicants must provide detailed information about the business, including:
- Corporate structure and business activities
- Details of directors and management
- Policies for AML/CFT, cybersecurity, and data protection
- Risk assessment frameworks and internal controls
Travel Rule and AML/CFT Compliance:
VASPs must:
- Record and retain information about transaction originators and beneficiaries
- Monitor for high-risk or non-compliant transactions
- Implement procedures aligned with international AML/CFT standards
Client Protection Measures that the regulator expects to see include:
- Clear systems for asset segregation
- Safeguards to ensure market integrity
- Complaint-handling mechanisms
- Ring-fencing of client assets to prevent misuse
Ongoing Reporting Obligations include:
- Quarterly operational reports
- Annual audited financial statements
- Risk management reviews and other reports as directed by the Regulator
- Proof of Insurance Coverage – Licensed businesses must maintain adequate insurance to cover liabilities that may arise from operational failures or omissions.
Transition Period for Existing Businesses
Businesses already operating in SVG before the regulatory framework becomes fully effective are allowed a limited grace period to comply. During this period:
- Operations may continue temporarily, subject to timely submission of a registration application
- If an application is rejected or withdrawn, operations must cease within a defined period
- The regulator may also order immediate cessation if necessary to protect public interest
Preparing for Compliance:
If you are an existing SVG Company involved in the provision of Virtual Asset services you will want/need to prioritize:
- Appointing a qualified Principal Representative based in SVG
- Engaging a certified external auditor for ongoing compliance
- Reviewing capital adequacy and preparing the statutory deposit
- Compiling fit and proper documentation for all key personnel
- Implementing AML/CFT, cybersecurity, and data protection policies
- Establishing internal controls for risk management and client asset protection
Would you like to know more? Then please Contact Us:
info@offshorecompaniesinternational.com
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