The Republic of Vanuatu (Vanuatu), located in the southwestern Pacific Ocean, is a member of the United Nations and hosts approximately 2,300 registered institutions providing banking, insurance, legal and trust services. In July 2024, Vanuatu's Prime Minister Salwai made an official visit to China and was received by General Secretary Xi Jinping. A joint statement was issued by the People's Republic of China and the Republic of Vanuatu regarding upgrading their comprehensive strategic partnership and building a ‘China-Vanuatu Community with a Shared Future’.
Vanuatu was once jointly administered by Britain and France and has long maintained a stable political environment and a sound legal system. In recent years, it has focused on strict financial regulatory legislation and licensing management for cryptocurrency companies. On March 26, 2025, the local parliament passed the Virtual Asset Service Providers (VASP) Act. Governmental regulatory advisors described the VASP Act as extremely stringent. The Act aims to establish a licensing and reporting framework for exchanges, NFT markets, crypto custody providers and initial coin offerings, creating a regulated digital business environment.
Following the enactment of the VASP Act, JunHe assisted South Pacific Investment Group under the Ministry of Finance (the Issuer) in collaborating closely with Vanuatu government authorities in Vanuatu and Hong Kong. We were responsible for preparing the application documents under the VASP Act, drafting internal control policies for the group, and responding to several rounds of inquiries from the Vanuatu Financial Services Commission (VFSC). We assisted the Issuer in obtaining Vanuatu's first virtual asset service provider license. We also arranged for the government authorities and the Issuer to hold technical, business, market, and compliance meetings in both regions according to the different jurisdictions' rules and business directives. We also reviewed and revised agreements with the third-party service providers, led the drafting of the stablecoin whitepaper and other documents, and assisted in implementing the business operation and compliance plan for the stablecoin USDV.
JunHe completed the financing structuring for the Issuer and drafted the finance agreement, shareholder agreement, warrant agreement and other documents. We negotiated with multiple investors and successfully secured financing for the Issuer through different channels. Within a very tight schedule, we assisted the Issuer in completing the VASP license application, the financing and restructuring, the project execution, and the inclusion in Vanuatu's national ‘Stablecoin Issuer Sandbox’ program. On June 6, 2025, the world's first ever offshore stablecoin USDV issued by a sovereign government made its successful debut.
JunHe provided comprehensive legal services to the Issuer. This included interpreting the virtual asset legislation in the different countries and regions, completing the VASP license applications, the financing structure planning and terms formulation, undertaking stablecoin issuance compliance and international capital market operations. This project demonstrates our expertise in capital markets and deep insight in emerging industries. Our significant advantage in balancing legal services and business acumen allowed us to seamlessly and efficiently interface with different business lines within the group, achieving one-stop project execution. It showcases JunHe's leading position in providing legal services for cross-jurisdictional Web3 markets and stablecoin issuance and earned us high trust and praise from the Vanuatu government and the group's shareholders.
JunHe was engaged to initiate the application process for the Issuer under Hong Kong's Stablecoins Ordinance to further enhance the client's global business expansion in Asia.
JunHe partner Phyllis Xu led the project team and was responsible for the project’s execution. Partner QIAO, Zheyuan (Jacqueline) also provided great support for the drafting of the risk control policies.