Following the results of the latest FATF Plenary of June 2022, HM Treasury Advisory Notice has updated the list of high countries referred to as Schedule 3ZA. The updated Schedule 3ZA came into force on the 11th of July 2022.
Given that the list of countries included Schedule 3ZA mirrors the jurisdictions considered by FATF as having strategic deficiencies, Malta has now been removed Schedule 3ZA and is no longer considered to be a high-risk country. Gibraltar has been now included in the updated Schedule 3ZA as a high risk third country for the purposes of money laundering. The United Arab Emirates has also been retained in Schedule 3ZA.
Subject persons are obliged to apply enhanced customer due diligence and enhanced ongoing monitoring in any business relationship with a person established in a high-risk third country or in relation to any relevant transaction where either of the parties to the transaction is established in a high-risk third country. This means that relevant persons are obliged to carry out enhanced customer due diligence and enhanced ongoing monitoring on all customers, new and existing, established in high-risk third countries listed in schedule 3ZA.
Subject persons are to ensure that third-country branches and subsidiaries in countries with weaker AML requirements than the UK apply measures equivalent to those in the UK. Regulation 33(1)(b) and 20(3) taken together create a requirement for UK relevant persons to ensure any of their branches or subsidiaries based in countries set out in schedule 3ZA apply measures equivalent to the enhanced customer due diligence measures.
The HM Treasury Notice on Money Laundering and Terrorist Financing Control in High-Risk Third Countries can be found on this link:
For further information, please contact:
Franco Falzon C.P.A. LL.M (Managing Director) or Olga Ivanova LL.M (Legal & Compliance)
T: +356 2010 7771 (office)
M: +356 9989 5679 (mobile)
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