What Are the AML/CTF Transitional Rules 2026?

The Anti-Money Laundering and Counter-Terrorism Financing Transitional Rules 2026
(instrument reference F2026L00393) were made by the Minister for Home Affairs, Tony Burke, on 27 March 2026
and commenced on 31 March 2026. They are made under the authority of the Anti-Money
Laundering and Counter-Terrorism Financing Amendment Act 2024 (the Amending Act).

The Transitional Rules exist for a clear purpose: to provide Australian reporting entities
with structured, time-limited relief as the amended AML/CTF framework takes effect. Rather than requiring
immediate and full compliance with all new obligations from 31 March 2026, the Rules allow businesses to
transition progressively — maintaining certain existing practices while preparing for the fully reformed
regime.

The instrument spans nine parts and 20 sections, covering everything from registration
continuity and customer due diligence to virtual asset service provider obligations, reporting transitions,
independent evaluations, and compliance officer notifications.

This guide walks through each part of the Transitional Rules in plain language, explaining what each
provision means in practice, what action is required, and when deadlines fall.

Part 1 — Preliminary: Key Definitions

Enrolment Identifier

One of the most operationally significant definitions is the enrolment identifier — the
numeric identifier assigned to a reporting entity at the time it submits an application for enrolment under
subsection 51E(1) of the Principal Act. s 4

This number is not administrative window-dressing. As explained further under Part 7 of this guide, the
last two digits of your enrolment identifier determine which independent evaluation deadline applies
to your organisation under section 17 of the Transitional Rules. Entities that do not know their
enrolment identifier should locate it immediately.

IVTS Reporting Transition Date

The IVTS reporting transition date is defined by reference to section 9 of the Transitional
Rules and defaults to 31 March 2029 for most reporting entities. This is the date from which
an entity must begin reporting international value transfer services (IVTS) under section 46 of the Principal
Act, replacing the older International Funds Transfer Instruction (IFTI) reporting regime under the previous
section 45.

Understanding your IVTS reporting transition date is critical for any business involved in international
money or value transfers. The full mechanics — including the ability to elect a substitute date — are
explained under Part 4 of this guide.

Other Key Definitions

The following terms are used throughout the Rules and carry the same meaning as in the Anti-Money
Laundering and Counter-Terrorism Financing Act 2006 (the Principal Act):

• Reporting entity — any person who provides a designated service within the meaning of the
  Act
• Designated service — services listed in tables 1–6 of section 6 of the Principal Act,
  spanning financial, remittance, virtual asset, and advisory services
• Registrable virtual asset service — a virtual asset service that requires registration
  with AUSTRAC under the amended Act
• AML/CTF Rules — the subordinate rules made under the Principal Act, including previous
  rules instruments and those made under the new framework
• Amending Act — the Anti-Money Laundering and Counter-Terrorism Financing Amendment
  Act 2024, which triggered the need for these Transitional Rules

Part 2 — Registration: Continuity Without Re-Registration

Section 5 — Remittance Sector Register

Section 5 makes clear that nothing in the Amending Act has affected the registration status of persons
already on the Remittance Sector Register. s 5

Three categories of registrant are expressly protected:

• Registered remittance network providers
• Registered independent remittance dealers
• Registered remittance affiliates of a registered remittance network provider

If you held any of these registrations before 31 March 2026, your status carries over automatically. No
renewal, re-application or notification to AUSTRAC is required under this provision.

Section 6 — Virtual Asset Service Provider Register

Section 6 creates a deemed VASP registration for former digital currency exchange (DCE) providers. s 6

This is a consequential provision. The category of “digital currency exchange provider” has been superseded
by the broader concept of “virtual asset service provider” under the amended Act. Rather than requiring DCE
providers to go through a fresh registration process — which would have created disruption and potential gaps
in coverage — the Rules simply deem the old registration to have converted.

Part 3 — Customer Due Diligence: Using Old CIPs Under the New Framework

Section 7 — AML/CTF Policy Requirements for Continued CIP Use

Under the new framework, reporting entities are required by paragraph 26F(3)(b) of the Principal Act to
maintain AML/CTF policies addressing initial customer due diligence. Section 7 provides that an entity is
taken to comply with this requirement — without immediately adopting the new CDD procedures — if it meets a
set of conditions. s 7

The conditions

The entity’s AML/CTF policies must:

1. Provide for customer due diligence to be carried out using customer identification procedures that
   comply with the AML/CTF Rules as in force on 30 March 2026 (i.e. the old CIP
   standards).
2. Identify the classes of customers to which those old CIPs apply, in relation to
   commencing to provide a designated service at or through a permanent establishment in Australia. (This
   requirement applies from 1 July 2026.)
3. For each customer class, identify the date from which the old CIP will no longer be
   applied — the phase-out date. (Also applies from 1 July 2026.)
4. Be appropriate for managing and mitigating the risks of money laundering, terrorism
   financing and proliferation financing that the entity may reasonably face in providing its designated
   services.
5. Be appropriate to the nature, size and complexity of the entity’s business.

Effect on new AML/CTF Rules

Where an entity satisfies all of the above conditions, new AML/CTF Rules made under paragraphs 28(6)(a) or
(b), or section 29, of the Principal Act (as in force on or after 31 March 2026) do not apply
to that entity in relation to providing a designated service at or through a permanent establishment in
Australia to a customer covered by the old-CIP policy.

What section 7 does NOT cover

Section 7 explicitly does not deem compliance with policies relating to ongoing customer due
diligence under subsection 30(1) of the Principal Act. Ongoing CDD obligations apply in full and
are unaffected by the transitional relief provided here.

Sunset clause

Section 7 ceases to have effect entirely on 31 March 2029. By that date, all reporting
entities must have transitioned to compliant customer due diligence procedures under the new framework.

Section 8 — Using Old CIPs in Practice

Section 8 addresses what happens when an entity actually carries out a customer identification procedure
under the transitional regime. s 8

A reporting entity is taken to have established on reasonable grounds each of the matters
required by subsection 28(2) of the Principal Act (initial CDD establishment) in relation to a customer if:

• It carries out the applicable CIP as it stood on 30 March 2026 for that customer; and
• At the time of carrying out the CIP, the entity meets the conditions in section 7(1)(a) and (b).

Service before CIP: An entity may commence providing a designated service to the customer
before carrying out the CIP, provided that old section 33 of the Principal Act (as at 30 March 2026)
and associated AML/CTF Rules would have permitted carrying out the CIP after commencement of the service.
s 8(2)

Losing the protection: The deemed compliance under section 8(1) is lost if the entity
commences the service before the CIP and then fails to subsequently carry out the CIP in accordance
with old section 34 requirements. Entities relying on post-commencement CIP must ensure they follow through.
s 8(3)

Part 4 — Reporting Obligations: Managing the IFTI to IVTS Transition

Section 9 — The IVTS Reporting Transition Date

The IVTS reporting transition date is the date from which a reporting entity must submit reports about its
provision of international value transfer services in accordance with section 46 of the Principal Act. Before
that date, the entity must instead report on international funds transfer instructions under the old section
45 regime. s 9

The default transition date is 31 March 2029. However, entities that have previously had
IFTI reporting obligations may elect to substitute a later date.

Substitute date election

A reporting entity may give the AUSTRAC CEO written notice of a substitute IVTS reporting transition date
that is:

• No earlier than 31 March 2029; and
• No later than 30 September 2029.

Multiple notices can be given, and a substitute date can be changed — but each notice must be given at least
10 business days before both the previous transition date and the proposed substitute date.

Virtual asset carve-out — no substitute date available

Entities providing designated services covered by items 29 or 30 of table 1 in section 6 of the Principal
Act, where the transfer involves a virtual asset, are locked to the default 31 March 2029
date. Any previously given substitute date notice ceases to have effect. s
9(4)

Section 10 — Reporting Obligations During the Transition Period

Until an entity reaches its IVTS reporting transition date, section 10 provides the governing framework for
reporting obligations. s 10

The key modifications are:

• New IVTS reporting suspended: Subsection 46(2) of the Principal Act does not apply to
  international value transfer services commenced before the entity’s transition date.
• Old IFTI obligation preserved: Section 45 of the Principal Act as it stood on 30 March
  2026 continues to apply to all international funds transfer instructions until the entity’s transition date
  (or 31 March 2029 for non-reporting-entity persons).
• Old framework continues in full: The Principal Act, all AML/CTF Rules, and all exemptions
  in force on 30 March 2026 continue to govern IFTI reporting during this window.
• Protections apply: Sections 48A (use of AUSTRAC information), 49 (secrecy), and 51
  (tipping-off provisions) of the Principal Act apply to IFTI reports made under the transitional framework.

IFTI reporting exception

An entity is not required to give the AUSTRAC CEO a report about an international funds
transfer instruction if, within 10 business days of the instruction being sent or received,
the entity: (a) reasonably determines the transfer will not occur; and (b) takes reasonable steps to prevent
it. s 10(4)

Section 11 — Self-Hosted Virtual Asset Wallet Reporting

Section 46A of the Principal Act — which requires reporting of transfers of value involving
unverified self-hosted virtual asset wallets — does not apply to a reporting entity in
relation to any designated service commenced before 31 March 2029. s 11

This provides a three-year grace period for entities to build the systems and processes needed to identify
and report on self-hosted wallet transfers.

Part 5 — Virtual Asset Service Providers: Grace Periods and Registration

Section 12 — Delayed Application of Key Principal Act Provisions

For reporting entities providing registrable virtual asset services not covered by item 50A
of table 1 in section 6 of the Principal Act (i.e. newly regulated VASP services), the following parts of the
Principal Act do not apply until 1 July 2026: s 12

• Part 1A — AML/CTF programs
• Part 2 — Customer due diligence
• Part 3 — Reporting obligations
• Part 5 — Obligations relating to transfers of value
• Divisions 2–6 of Part 10 — Record-keeping

This means newly regulated VASPs have until 1 July 2026 to build and implement the compliance infrastructure
required for these obligations.

Section 13 — Extended Enrolment Deadline

Under the Principal Act, reporting entities ordinarily have 28 days from the day they commence providing a
designated service to apply for enrolment. Section 13 extends this deadline for a specific category of person.
s 13

This section applies to a person who, before 1 July 2026: (a) provides a registrable virtual asset service
not covered by item 50A; and (b) does not at that time provide any other kind of designated service.

For such a person, the enrolment deadline is extended from the standard 28 days to 29 July
2026.

Section 14 — Registration to Provide Registrable Virtual Asset Services

Section 76A of the Principal Act prohibits a person from providing a registrable virtual asset service
without being registered. Section 14 creates two windows during which this prohibition does not apply to newly
regulated services. s 14

Scenario 1 — Service already being provided

Section 76A does not apply if all three conditions are met:

• The service is not covered by item 50A of table 1;
• The service is provided on or before 30 June 2026; and
• The person submits a registration application under section 76D by 29 July 2026.

Scenario 2 — Application submitted before service commences

Section 76A does not apply if all four conditions are met:

• The service is not covered by item 50A;
• A registration application under section 76D was submitted before commencing the service;
• The application was submitted no later than 29 July 2026; and
• At the time of providing the service, AUSTRAC has not yet issued a decision — approval or
  refusal.

Fit and proper person declaration waived

Subsection 76D(4) of the Principal Act — which requires a fit and proper person declaration — does not apply
to registration applications lodged between 31 March 2026 and 29 July 2026. This waiver is
unconditional within the window; AUSTRAC has no discretion to require the declaration during this period.
s 14(3)

Part 6 — Financial Advisers: Simplified Program Eligibility

Section 15 — Modified Application for Financial Advisers

Section 26T of the Principal Act provides a simplified AML/CTF program pathway for certain designated service
providers. Section 15 of the Transitional Rules temporarily extends this benefit to financial advisers who
also provide table 6 services. s 15

Where all of the designated services provided by a reporting entity are covered by:

• Item 54 of table 1 in section 6 of the Principal Act (financial advisers); and
• Any item of table 6 in section 6;

then, for the purposes of section 26T, all of the entity’s designated services are taken to be covered by
item 54 only until 1 July 2026.

In practical terms, this means a financial adviser who also provides table 6 services is treated as a pure
item 54 provider — and thus eligible for the simplified AML/CTF program available to item 54 providers — until
1 July 2026, at which point full obligations apply to the entity’s complete service profile.

Part 7 — Independent Evaluations: Staggered Deadlines

Section 16 — Previously Regulated Reporting Entities

For reporting entities that were enrolled on 30 March 2026 and had previously carried out at least one
independent review of Part A of their AML/CTF program under the Anti-Money Laundering and
Counter-Terrorism Financing Rules Instrument 2007 (No. 1), the first independent evaluation under the
new framework is taken to comply with frequency requirements if it is conducted before the
later of: s 16

• 4 years after the date of the last independent review under the 2007 Rules Instrument; or
• 31 March 2027.

Section 17 — New Reporting Entities and Others Without Prior Review Requirements

Section 17 applies to three categories of entity: s 17

• Persons to whom item 12 of Schedule 3 to the Amending Act applies (new reporting entities);
• Persons to whom section 13 of the Transitional Rules applies (newly regulated VASPs with extended
  enrolment); and
• Entities that were reporting entities before 31 March 2026 providing only item 54 designated services.

For these entities, the first independent evaluation deadline is staggered based on the last two
digits of their enrolment identifier:

This staggered approach distributes the evaluation workload across the market, avoiding a single cliff-edge
deadline for all newly regulated entities at once.

Part 8 — AML/CTF Compliance Officers: Notification Deadlines

Section 18 — General Notification Deadline

Reporting entities enrolled as at 30 March 2026 are taken to comply with the notification obligation in
subsection 26M(1) if they give AUSTRAC the required notification on or before 30 May 2026.
s 18

Section 19 — Extended Deadline for Delayed Enrolment Entities

For entities covered by item 12 of Schedule 3 to the Amending Act or section 13 of the Transitional Rules
(primarily newly regulated VASPs with extended enrolment), the notification deadline is the
later of: s 19

• 14 days after the entity’s name is entered on the Reporting Entities Roll; or
• 29 July 2026.

Part 9 — Foreign Law Defence: Retrospective Notice Relief

Section 20 — Notice After Conduct Occurs

Section 236A of the Principal Act creates a defence for a reporting entity where a law of a foreign country
prevented it from complying with a provision of the Act. One of the conditions for relying on this defence is
giving the AUSTRAC CEO written notice — ordinarily, before the relevant conduct occurs. s 20

Section 20 of the Transitional Rules relaxes this requirement during the initial transition period. A
reporting entity is taken to have complied with paragraph 236A(1)(c) if:

• The conduct alleged to constitute a contravention of a civil penalty provision occurs on or before
  30 June 2026; and
• The required written notice is given on or before 30 June 2026 — including after the
  conduct has already occurred.

In practical terms, entities managing conflicts between Australian AML/CTF obligations and the laws of
foreign jurisdictions now have until 30 June 2026 to both act and notify — with the notice permitted to be
retrospective (i.e. given after the conduct) within that same window.

This is a meaningful concession for entities operating across multiple legal systems at the commencement of a
substantially reformed regulatory regime.

Summary of Key Compliance Deadlines

The following table consolidates all material deadlines arising from the AML/CTF Transitional Rules 2026.
Entities should use this as a starting point for their compliance calendar.

What Reporting Entities Should Do Now

The Transitional Rules are now in force. The following immediate actions apply across most categories of
reporting entity:

1. Locate your enrolment identifier. The last two digits determine your independent
   evaluation deadline under section 17. If you don’t know your enrolment ID, retrieve it from AUSTRAC’s
   reporting portal.
2. Review your AML/CTF policies for risk-based compliance. If you intend to use
   transitional customer identification procedures under section 7, your policies must now also satisfy the
   risk-based and proportionality conditions — not just comply with the old CIP rules.
3. Notify AUSTRAC of your AML/CTF compliance officer by 30 May 2026 (if enrolled
   before 31 March 2026). This is the most immediate hard deadline and falls within 60 days of the Rules’
   commencement.
4. VASPs: determine which registration pathway applies and ensure an application under
   section 76D is lodged by 29 July 2026. Be aware that the Scenario 2 protection ceases immediately upon any
   AUSTRAC decision.
5. IFTI reporters: assess whether a substitute IVTS transition date is appropriate for
   your business. If so, give notice at least 10 business days before your current transition date. Remember
   that virtual asset services (items 29/30) lock you to the default 31 March 2029 date.
6. Plan your AML/CTF program for full compliance by 1 July 2026 if you are a newly
   regulated VASP. The grace period under section 12 ends on that date.