Dear Valued Members,
Under Article 36 of the Adjustment of International Taxes Act and the Implementation Regulations on the Automatic Exchange of Crypto-Asset Information pursuant to Information Exchange Agreements (the "CARF Implementation Regulations"), domestic virtual asset service providers are now required to collect self-certifications, conduct due diligence, identify reportable users, and report transaction information with respect to their members. We outline below what this framework entails and how it may affect you.
1. Overview
2. What Are the CARF Implementation Regulations?
The CARF (Crypto-Asset Reporting Framework) is an OECD framework for the automatic cross-border exchange of crypto-asset transaction information. It extends the existing CRS regime — which governs the exchange of financial account information — into the crypto-asset domain, enabling each jurisdiction's tax authority to mutually exchange information on assets held and transacted by its residents through overseas virtual asset service providers.
Korea has adopted this framework through Article 36 of the Adjustment of International Taxes Act and the CARF Implementation Regulations. Accordingly, domestic virtual asset service providers (including custodians) must fulfill member identification and reporting obligations.
3. What Is a Self-Certification?
A self-certification is a document in which a member (whether an individual or an entity) declares their own tax residency jurisdiction(s) and Taxpayer Identification Number (TIN), among other details. Based on the submitted self-certification, we perform due diligence to determine whether the member qualifies as a "Reportable User."
4. The Majority of Members Are Not Affected
✓ If you have no overseas tax obligations, you are not a reporting target
Although the self-certification requirement applies to all members, the majority of members who have no overseas tax obligations may continue using our services exactly as before and are not subject to reporting. Only a limited number of members with overseas tax obligations may be affected, for example through requests for additional information or supporting documentation.
Example — A Korean individual (or a Korea-resident entity) with tax obligations solely in Korea is not subject to reporting.5. Guidance for Corporate Clients
Unlike individuals, corporate members are assessed not only on the entity's own tax residency but also on its entity classification and its Controlling Persons. Reviewing the points below in advance will help ensure a smooth process.
* The exact items and supporting documents required may vary depending on the entity's classification and ownership structure, and will be provided in detail together with the form at the time of individual notification. If you have difficulty determining your status, please contact our team.
6. Timeline
* The detailed schedule and submission procedures set out in this notice are subject to change in accordance with applicable laws and the guidance of the tax authorities. Any changes will be reflected in this notice.
7. Submission Method and Contact
The self-certification form and submission procedures will be provided individually to affected members. For any inquiries, please contact us using the details below.
Thank you.
