EU proposes removal of Gibraltar and UAE from list of High-Risk Third Countries

The European Commission proposed, on 14 March, the removal of Barbados, Gibraltar, Panama, Uganda and the United Arab Emirates (UAE) from the EU’s list of high-risk third countries with strategic deficiencies in their Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) regimes. The proposed regulation would also add Kenya and Namibia to the list.

The Commission said that since the last review of its list, the Financial Action Task Force (FATF) had removed Barbados, Gibraltar, Uganda and the UAE from its own ‘grey list’ of jurisdictions subject to increased monitoring in February, following the implementation of the respective action plans they had agreed with the FATF.

The Commission had reviewed, based on the requirements of the Fourth Anti-Money Laundering Directive (Directive (EU) 2015/849 – AMLD4), the progress of these four countries in addressing their strategic deficiencies in their respective AML/CFT regimes. Given the measures they had implemented to address the action plans agreed with the FATF, it had concluded that they no longer posed a significant AML/CFT threat to the international financial system.

However, considering that the FATF had added Kenya and Namibia to its ‘grey list’ of jurisdictions subject to increased monitoring in February, the Commission said it considered that these two countries now met its own criteria for listing under AMLD4 and should be added to its list of high-risk third countries.

AMLD4 requires obliged entities in all EU member states to apply enhanced customer due diligence measures to manage and mitigate risks appropriately. With respect to business relationships or transactions involving high-risk third countries, AMLD4 sets out the enhanced customer due diligence measures that member states must require obliged entities to apply.