By clicking “Accept”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Privacy Policy for more information.

Activate Additional Entities Effortlessly with Notabene's Multi-Jurisdictional Compliance Tool

The Notabene Team
The Notabene Team
March 11, 2024
A member of the Notabene team crafted this post.

As regulations evolve, so do the challenges. Global VASPs increasingly finding themselves at the crossroads of Travel Rule compliance, a task that becomes more daunting as they expand across various jurisdictions. 

The goal of maintaining a global presence while adhering to local regulations is more critical than ever. In response to these evolving demands, Notabene offers a comprehensive Multi-Jurisdictional Compliance tool designed to simplify the management and expansion of VASPs' jurisdictional reach with ease.

Understanding the Multi-Jurisdictional Compliance Landscape

The landscape of Travel Rule compliance is rapidly changing, with a significant uptick in VASPs that are subject to Travel Rule obligations in more than one country. According to our State of Crypto Travel Rule Compliance Report 2024, nearly 50% of VASPs are now navigating the complexities of multi-jurisdictional compliance, marking a 104% increase from the previous year. Further, our survey highlighted that 65% of respondents name ‘multi-jurisdictional rollout’ as their top two factors as they search for Travel Rule compliance solutions, underscoring the growing importance of adaptable and extensive compliance frameworks in today's global market.

Navigating the Challenges of Global Travel Rule Compliance

VASPs operating across multiple jurisdictions encounter a myriad of challenges, including:

  • Diverse Compliance Requirements: Each jurisdiction comes with its own set of compliance mandates, from specific Personal Identifiable Information (PII) requirements to varying approaches to self-hosted wallet transactions. This diversity necessitates a bespoke compliance strategy for each jurisdiction, adding layers of complexity to global operations.
  • Customized Implementation Needs: Expanding into new jurisdictions isn't just about scaling operations; it involves intricate technical implementations, operational adjustments, and comprehensive local staff training to ensure seamless integration into the existing compliance framework.
  • Complex Organizational Structures: VASPs often operate within complex organizational frameworks, ranging from centralized, nested structures under a single parent entity to independent, un-nested setups that allow for autonomy. Some combine these models to accommodate intricate compliance and operational needs, further complicating the implementation of global compliance strategies.
  • Accurate Transaction Routing: Ensuring that transactions are correctly associated with the appropriate jurisdiction adds another layer of complexity. This is particularly crucial, as accurately identifying transaction counterparts is the essential first step for Travel Rule compliance. Currently, VASPs utilize a combination of blockchain analytics, customer input, and other discoverability methods to navigate this challenge. However, these methods have limitations, such as the inability of blockchain analytics to pinpoint specific legal entities and the reliance on potentially uninformed end customers for crucial transaction details.

Introducing Notabene's Multi-Entity Support Tool

Notabene introduces the Multi-Jurisdictional Support tool, designed specifically for global VASPs to manage multiple entities and transactions across jurisdictions effortlessly. 

Simplified Jurisdiction Activation and Management

Activating a new jurisdiction is as straightforward as accessing the Notabene dashboard and selecting "activate new jurisdiction." This action seamlessly integrates the specific regulatory requirements of the new jurisdiction into the entity's operations, ensuring compliance with minimal effort.

Deep Regulatory Insight and Automated Compliance

Notabene's platform is enriched with insights from active engagement with regulators and industry experts, ensuring a standardized approach to compliance. With regulatory requirements from over 23 jurisdictions encoded, VASPs can confidently expand their global operations, knowing they are in compliance with local laws.

Flexible Organizational Structuring

The tool accommodates various organizational structures, allowing companies to reflect their real-world setup within the platform:

  • Nested Structure: For centralized management, entities can be organized hierarchically within a parent entity.
  • Un-nested Structure: Entities can operate independently, providing autonomy and customization.
  • Mixed Structure: A combination of nested and un-nested entities supports complex compliance needs.
  • Single and Multiple Group Options: Entities can be streamlined under a single group or divided among multiple groups to facilitate the management of diverse business units or subsidiaries.

Streamlined Transaction Routing

Notabene's Multi-Jurisdictional Support tool ensures transactions are automatically allocated to the correct entity, enhancing compliance with local regulatory reporting requirements. Our solution allows the Beneficiary VASP, best positioned to identify the receiving entity, to redirect Travel Rule transfers automatically to the relevant entity. This not only speeds up the pre-authorization of transactions but ensures their accurate delivery, relieving the Originator VASP of the burden of discovery.

Moreover, beneficiary VASPs with multiple entities can allocate deposit transfers automatically with our transaction redirect feature, allowing each entity to manage Travel Rule records tied to their deposits. This facilitates compliance demonstration to auditors and supervisors at the entity level.

Failure to redirect transfers correctly may result in loss of transaction volume for Beneficiary VASPs, as stricter due diligence obligations demand precise identification of transacting parties. Hence, Originator VASPs may hesitate to share Travel Rule information when the specific legal entity is unknown.

Elevate Your Compliance Strategy Today

Prepare your global company for success with Notabene's Multi-Jurisdictional Support tool. For existing customers, please designate a Group Admin to unlock these features. New customers will be guided through this process automatically.