Draft regulations: The Cryptoasset Service Providers (Due Diligence and Reporting Requirements) Regulations 2025
In November 2023, the previous government announced its intention to implement the Organisation for Economic Co-operation and Development Cryptoasset Reporting Framework. At Spring Budget 2024 a consultation was launched seeking views on the implementation of these new rules and certain other proposals. The government is now publishing draft CARF regulations. These are published alongside the summary of responses to the consultation.
The draft regulations set out further details of:
- reporting and due diligence requirements for reportable cryptoasset service providers (RCASPs) to comply with the CARF
- penalties for failing to comply with the regulations and appeals process
- the requirement for cryptoasset users to provide a valid self-certification
- penalties for failure to provide a valid self-certification
These draft regulations will be of interest to
- RCASPs which facilitate the provision of cryptoassets and transactions with cryptoassets
- organisations and bodies that represent RCASPs or their advisors.
- cryptoasset users
The government is seeking technical feedback on the draft regulations to ensure they operate as the government intends and to identify any areas which need further clarification in more detailed guidance. If you identify any issues for cryptoasset service providers operating under the new UK CARF regime set out in the draft CARF regulations, please email eoi.policy@hmrc.gov.uk by 10 January 2025. HMRC are happy to have meetings to discuss technical concerns raised by the draft regulations.
The final regulations are expected to be made in 2025 to come into force on 1 January 2026.