Pursuant to the PCMLTFA, you are required to have a Canada MSB (Money Services Business) Registration if your business involves any of the following:
1. Foreign Exchange Dealing
Conducting transactions where you exchange one type of currency for another (for example, exchanging USD for CAD).
2. Remitting or Transferring Funds
Remitting or transmitting from one person or entity to another using an electronic funds transfer network or any other method such as Hawala, Hundi, Fei ch’ien, and Chitti. This includes remitting or transmitting funds (as instructed by your clients) carried out by means of a credit/debit card if the beneficiary has an agreement with the payment service provider that permits payment by that means for the provision of goods and services.
3. Issuing or Redeeming Money Orders, Traveller’s Cheques or Anything Similar
Your business issues or redeems money orders, travellers’ cheques or other similar negotiable instruments. This does not include cashing cheques made out to a particular person or entity.
4. Dealing in Virtual Currency (Cryptocurrency)
This includes both virtual currency exchange and virtual currency transfer services.
Virtual currency exchange services include exchanging:
- funds for virtual currency,
- virtual currency for funds, or
- virtual currency for another virtual currency
Virtual currency transfer services include:
- transferring virtual currency at the request of a client, or
- receiving a transfer of virtual currency for remittance to a beneficiary.
5. Crowdfunding Platform Services
This includes both virtual currency exchange and virtual currency transfer services.
- You are incorporated in Canada;
- You have a physical location in Canada; or
- You have employees, agents or branches in Canada.
You will also require a Canada MSB (Money Services Business) License if:
- You hold a permit or licence related to any of the above-mentioned services.
- You are registered as someone offering any of the above-mentioned services.
- You advertise (by any means, including newspaper, television, Yellow Pages, internet, any other media, or by an interior or exterior sign) that you engage in any of the above-mentioned services.
- You do not advertise any MSB services, but you:
- offer money transfer services in any amount;
- conduct foreign exchange transactions for more than $1,000 during a single transaction with the same person or entity. For these purposes, a single transaction is defined as two or more transactions related to a foreign exchange transaction of less than $1,000 each that are made within 24 consecutive hours and that total $1,000 or more; or
- issue or redeem money orders, traveller’s cheques or other similar negotiable instruments for more than $1,000 during a single transaction with the same person or entity. For these purposes, a single transaction is defined as two or more transactions related to the redemption of money orders, travellers’ cheques or other similar negotiable instruments of less than $1,000 each that are made within 24 consecutive hours and that total $1,000 or more.
- You report the income of any of the above-mentioned services as income from a separate business for tax purposes.
Who does not require a Canada MSB Registration?The PCMLTFA does not apply to you if you are simply acting as an agent for a money services business or carrying out a money services business activity in the course of providing other services for which you are a reporting entity.
