South Korea Ministry of Economy and Finance secures approval for foreign exchange law amendment requiring registration of cross-border virtual asset transfer operators

South Korea's Ministry of Economy and Finance announced Cabinet approval of a Foreign Exchange Transactions Act amendment that brings cross-border virtual asset transfer business into the foreign exchange control framework. The amendment will require virtual asset businesses that conduct cross-border transfer services to register in advance with the Minister of Economy and Finance and to report cross-border transfer details through the Bank of Korea's foreign exchange electronic network. The ministry said the changes respond to the growing use of virtual assets in cross-border transactions and the related increase in attempts to evade foreign exchange rules or conduct illegal transactions. Reported data will be shared with the National Tax Service, Korea Customs Service, Financial Supervisory Service and the Financial Intelligence Unit for use in investigations and other enforcement work. Operators that fail to register or refuse reporting or inspection will face sanctions comparable to those applied to existing foreign exchange business institutions. The amendment is scheduled to be promulgated on June 2 and will take effect six months after promulgation. The ministry also plans follow-on amendments to subordinate rules and further consultation with relevant agencies and industry to support the operation of the information collection, sharing and post-transaction investigation framework.