You can continue to use applicable customer identification procedures (ACIP) instead of the new initial customer due diligence (CDD) obligations for a limited time if both of the following apply: 

• you were enrolled as a reporting entity on 30 March 2026
• you maintain AML/CTF policies that require you to use ACIP that complied with the AML/CTF Rules in force on that date.

This transitional period runs from 31 March 2026 to 31 March 2029.

You must have transitional policies

To rely on this transitional rule, you must do the following by 1 July 2026:

• list the classes of customers you will apply ACIP to
• state the date when you’ll stop applying ACIP to each class.

These transitional AML/CTF policies must both:

• appropriately manage and mitigate your ML/TF risks
• be appropriate to the nature, size and complexity of your business.

This criterion only applies to your transition from ACIP to ICDD. 

Your ACIP itself does not need to be reassessed against these criteria and must continue to comply with the AML/CTF Rules that applied on 30 March 2026.

You can change customer classes and transition dates at any point during the transitional period by updating your policies using your usual AML/CTF program governance processes (for example, senior manager approval).

How you may apply ACIP during the transitional period

You may apply ACIP to some or all classes of customers during the transitional period. For example, you could:

• continue using ACIP for certain customer classes
• move other customer classes to the new initial CDD framework.

You can define classes of customers in a way that makes sense for your business. For example, classes of customer may be based on:

• the customer’s legal form (such as individuals, companies, or trusts)
• geographic location
• type of designated service they receive.
• business line within the reporting entity.

Each customer class must be subject either to ACIP or the new ICDD framework at any given time. You can only use ACIP for customers where your transitional policies say ACIP applies.

If you use ACIP for a customer class, you may continue to rely on the pre‑reform delayed verification and safe harbour provisions (including section 33 and section 34 of the Act and associated Rules) where they would have applied under the old framework.

Ongoing CDD and other CDD reforms

This transitional arrangement applies only to initial CDD.

You must comply with the new ongoing CDD obligations from 31 March 2026. You also cannot use the new deemed compliance or delayed CDD provisions  for services provided in Australia until you have transitioned to the new initial CDD framework.

Other CDD‑related reforms apply to you from 31 March 2026, including the new $5,000 threshold for certain gambling services.

Our expectations during your transition

AUSTRAC expects you to manage the transition in a structured way. 

We recognise that, although the law requires you to apply one approach per customer class, short and practical periods of operational overlap may occur as you update systems and processes.

We expect your implementation plan to clearly explain:

• which customer classes you will transition and when
• how you will minimise and control any overlap between ACIP and the new framework
• how you will ensure both ACIP and initial CDD arrangements continue to manage and mitigate ML/TF risks.

Learn more about AUSTRAC’s regulatory expectations for implementation of the AML/CTF reforms.

What this means in practice

• You must update your AML/CTF policies to document which customer classes you will apply ACIP to, and when they will transition to the new initial CDD obligations.
• You may transition different customer classes at different times, but each class must only be subject to one initial CDD approach at a time.
• You must apply the new ongoing CDD obligations to all customers from 31 March 2026.
• Any operational overlap should be temporary, documented and controlled.
• All other obligations under the Act continue to apply.

You can find our pre-reform guidance on ACIP obligations here.

Extended period for notifying us of an AML/CTF compliance officer

The transitional rules extend the time you have to notify us of your AML/CTF compliance officer.

If you were enrolled as a reporting entity on 30 March 2026, you must notify AUSTRAC by 30 May 2026.

If you are a newly regulated business, you must notify us by the later of:

• 14 days after your enrolment with AUSTRAC
• 29 July 2026.

For example, if you enrolled with us on 29 July 2026, you would have until 12 August 2026 to notify us of your AML/CTF compliance officer.

What this means in practice

• You have additional time to notify us of your AML/CTF compliance officer.
• After this transitional period ends, the standard 14‑day notification rule applies.

Learn more about the role and responsibilities of an AML/CTF compliance officer.

Financial advisers becoming tranche 2 entities

You are eligible for this transitional rule if all of the following apply:

• you hold an Australian financial services licence
• before 31 March 2026, you only provided arranging services under item 54 of table 1 of section 6 to the Act
• from 31 March 2026, you also provide designated services listed in table 6 (professional services).

If you meet these criteria, the transitional rules treat your professional services as item 54 services until 1 July 2026.

This means you may continue applying the reduced AML/CTF program and governance requirements until 30 June 2026.

From 1 July 2026, you will need to fully comply with all AML/CTF obligations for reporting entities that provide professional services. This includes developing and maintaining a full AML/CTF program, and complying with customer due diligence, reporting and record‑keeping requirements.

Staggered initial independent evaluations

The reforms replace independent reviews of Part A of your AML/CTF program with independent evaluations of your entire AML/CTF program. Your AML/CTF policies must set the frequency of these evaluations.

The transitional rules give different timeframes for your first independent evaluation.

Newly regulated businesses or entities previously only providing item 54 services

You will comply with your policy frequency requirements if you conduct your first independent evaluation by:

• 30 June 2029: if the last two digits of your AUSTRAC account number (AAN) are both odd numbers. You will receive your AAN when you enrol with AUSTRAC.
• 31 December 2029: if the second‑last digit is odd and the last digit is even
• 30 June 2030: if the last two digits are both even
• 31 December 2030: if the second‑last digit is even and the last digit is odd

Existing regulated reporting entities

If you were enrolled on 30 March 2026 and have already had at least one independent review under the pre-reform Rules, you must conduct your first independent evaluation by the later of:

• 4 years after your most recent independent review
• 31 March 2027.

What this means in practice

• If you are a newly regulated business, check your AAN to determine your evaluation deadline.
• If you are an existing regulated business, check when you last had an independent review to determine your evaluation deadline.
• Update your AML/CTF program so your evaluation schedule aligns with the deadline you’ve identified.

Learn more about conducting an independent evaluation.

Transition to international value transfer service reporting

The obligation to report international value transfer services (IVTS) under section 46 of the Act is deferred until your IVTS reporting transition date. Until that date, you must continue reporting international funds transfer instructions (IFTIs) under the pre‑reform Act, Rules and exemptions.

Your IVTS reporting transition date will either be:

• 31 March 2029, or
• a substitute transition date that is no earlier than 31 March 2029 and no later than 30 September 2029.

Until this transition date, you must continue reporting IFTIs unless you do both of the following within 10 business days after receiving or sending the relevant instruction: 

• reasonably determine that the transfer of money or property to which the instruction relates will not occur
• take reasonable steps to ensure that the transfer of money or property will not occur.

When you are eligible to nominate a substitute transition date

You can only nominate a substitute transition date if you have been required to give us at least one IFTI report before 31 March 2026. 

If you provide international value transfers involving virtual assets before 31 March 2029, you cannot choose a substitute IVTS reporting transition date. Your transition date will be 31 March 2029.

Your IVTS reporting transition date becomes the date you start providing those services if you: 

• start providing these services on or after 31 March 2029
• had previously notified a later substitute date.

How to nominate a substitute transition date 

You must notify us at least 10 business days before both the date you are changing from and the substitute date you are changing to.

For example, if you want to move your IVTS reporting transition date from 31 March 2029 to 30 September 2029, you must notify us by 16 March 2029. 

We will not be accepting notifications until 2029. We will release further guidance in early 2029 on the process for notifying us.

What this means in practice

• You must continue submitting IFTI reports until 31 March 2029, when you will transition to IVTS reporting.
• If you want more time to switch to IVTS reporting, check your eligibility, then notify us of your new transition date in early 2029 once guidance is released.
• If you only transfer virtual assets as a designated service under items 29 and 30 of table 1, and don’t transfer money or property, you will not need to report IFTIs.
• If you only use virtual assets as a means of settlement with another remitter or financial institution, you must still report IFTIs.
• If you provide international value transfers involving virtual assets, you will need to be ready to transition by 31 March 2029.

Learn more about international funds transfer instruction (IFTI) reporting.

Reporting value transfers involving unverified self‑hosted virtual asset wallets

You are not required to submit reports of transfers of value involving unverified self‑hosted virtual asset wallets until 31 March 2029 if you start providing the relevant designated services before that date.

If you start providing these designated services on or after 31 March 2029, the obligation to report transfers involving unverified self‑hosted wallets will apply from when you start providing the service.

We will provide more information on how to identify unverified self‑hosted wallets, and what to include in these reports, closer to 31 March 2029.

What this means in practice

• You do not need to put reporting processes for unverified self‑hosted wallets in place yet if you already provide the relevant designated services.
• You still need to comply with suspicious matter reporting and other obligations under the Act.
• We expect you to begin planning for system and policy changes needed to implement this obligation by 31 March 2029.

Learn more about additional travel rule obligations when transferring virtual assets.

Deferred AML/CTF obligations for new virtual asset services

Some AML/CTF obligations don’t apply to new registrable virtual asset services until 1 July 2026. This excludes item 50A services involving exchange between virtual assets and fiat currency. The AML/CTF obligations that don’t apply include:

• Part 1A (AML/CTF programs)
• Part 2 (customer due diligence)
• Part 3 (reporting obligations)
• Part 5 (transfers of value involving virtual assets)
• Divisions 2–6 of Part 10 (record‑keeping).

This deferral does not apply to services under item 50A. These services must meet the new obligations from 31 March 2026.

If you currently provide both item 50A services and new registrable virtual asset services, AML/CTF obligations for those new services are deferred until 1 July 2026. This means, for example, that you are not required to comply with travel rule obligations for virtual asset transfers until 1 July 2026.

If you begin providing a new registrable virtual asset service before 1 July 2026 you have until 29 July 2026 to apply to enrol and register. If you are already an enrolled and registered digital currency exchange provider, you don’t need to apply to enrol and register again. 

What this means in practice

While some obligations do not apply to your new registrable virtual asset services until 1 July 2026, you still must:

• enrol and register with us within the required timeframe
• comply with AML/CTF obligations for any other designated services you provide
• prepare now for customer due diligence, AML/CTF program requirements, reporting, transfer of value and record‑keeping obligations that will apply from 1 July 2026
• if we register you, abide by any conditions of your registration
• if we refuse to register you, stop providing registerable virtual asset services. 

The deferral gives you time to:

• build or update systems
• train staff
• implement the virtual asset travel rule requirements
• embed new policies and procedures.

Enrolment and registration roll‑over

If you are already enrolled with us, you do not need to enrol again. 

The transitional rules confirm that the reforms do not affect your status as a registered remittance network provider, remittance affiliate or independent remittance dealer.

They also confirm that you do not need to re‑register if you are already registered as a digital currency exchange provider. You will automatically be registered as a virtual asset service provider (VASP) from 31 March 2026. 

What this means in practice

• If you are already enrolled, you don’t need to enrol again.
• You do not need to re-apply to confirm your registration status, as this will occur automatically. 

Learn more about enrolment and registration.

Extended period to notify us when foreign law prevents compliance

Section 236A of the Act provides a defence where a law of a foreign country prevents compliance with certain AML/CTF obligations. Normally, you must notify us before the relevant conduct occurs.

Under the transitional rules, you may still rely on this defence if:

• the conduct occurs on or before 30 June 2026, and
• you give us the required written notice by 30 June 2026, even if this is after the conduct occurs.

What this means in practice

• You have a short grace period where timing of notice is more flexible.
• After 30 June 2026, you must provide notice before the relevant conduct occurs.
• Review your overseas branches and subsidiaries now to determine where foreign laws may restrict compliance.

Learn more about foreign branches and subsidiaries.