Circular Letter No. CC/2023/00000033

Circular Letter No. CC/2023/00000033
Sent to:
Credit Institutions, Financial Companies, Payment Institutions, and Electronic Money Institutions.
Mod. 99999924/T – 01/14
Subject: Disclosure of FATF Communications (June 2023 Plenary Meeting)

I. COMMUNICATIONS ISSUED BY THE FATF
With the aim of protecting the international financial system from the risks associated with money laundering and terrorist financing, as well as to promote adequate compliance with AML/CFT standards, the FINANCIAL ACTION TASK FORCE (FATF) acts to identify jurisdictions presenting strategic deficiencies in money laundering and terrorist financing prevention and to develop coordinated and decisive responses worldwide to combat these realities.

Following the plenary meeting held between June 21 and 23, 2023, the FATF released the following documents:
a. HIGH-RISK JURISDICTIONS SUBJECT TO A CALL FOR ACTION, dated June 23, 2023, which identifies jurisdictions subject to countermeasures and jurisdictions with strategic deficiencies in money laundering and terrorist financing prevention that have not made sufficient progress in overcoming these deficiencies and/or have not agreed with the FATF on an action plan for this purpose. The full content of this document can be consulted at: https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Call-for-action-June-2023.html b. JURISDICTIONS UNDER INCREASED MONITORING, dated June 23, 2023, which identifies jurisdictions with strategic deficiencies in money laundering and terrorist financing prevention that have developed an action plan to overcome them and are subject to a monitoring process by the FATF. The full content of this document can be consulted at: https://www.fatf-gafi.org/content/fatf-gafi/en/publications/High-risk-and-other-monitored-jurisdictions/Increased-monitoring-june-2023.html

Regarding these documents, the following should be noted:

• Regarding the list of High-Risk Jurisdictions Subject to a Call for Action:
• Since February 2020, the FATF has paused the evaluation process for the Democratic People's Republic of Korea (North Korea) and the Islamic Republic of Iran, given the COVID-19 pandemic crisis and considering that these two jurisdictions were already subject to the application of countermeasures; therefore, the aforementioned document refers to the content of the February 2020 communication regarding these two jurisdictions;
• The Republic of the Union of Myanmar remains in the category of jurisdictions subject to the application of enhanced identification and due diligence measures proportional to the risks arising from them, and the FATF has updated its communication regarding the same.
• Regarding the list of Jurisdictions Under Increased Monitoring:
• Since February 2023, the progress of 18 jurisdictions has been assessed, and their respective statements have been updated;
• The Republic of Haiti, the Federal Republic of Nigeria, the Syrian Arab Republic, the United Republic of Tanzania, and the Republic of Yemen decided to postpone their reporting; therefore, for these jurisdictions, the FATF statements from October 2022 and February 2023, as applicable, were included in this document, but they may not reflect the current state of their respective money laundering and terrorist financing prevention regimes;
• Three new jurisdictions were identified and included: the Republic of Cameroon, the Republic of Croatia, and the Socialist Republic of Vietnam;
• In addition, it is important to note the maintenance of the suspension of the membership status of the Russian Federation.

II. COMPARATIVE FRAMEWORK WITH COMMUNICATIONS ISSUED BY THE FATF IN FEBRUARY 2023

HIGH-RISK JURISDICTIONS SUBJECT TO A CALL FOR ACTION | JURISDICTIONS UNDER INCREASED MONITORING ---|--- JURISDICTIONS SUBJECT TO THE APPLICATION OF COUNTERMEASURES | JURISDICTIONS SUBJECT TO THE APPLICATION OF ENHANCED MEASURES | JURISDICTIONS SUBJECT TO A MONITORING PROCESS | JURISDICTIONS THAT LEFT THE MONITORING PROCESS PLenary MEETING 21-23 JUNE 2023 | Democratic People's Republic of Korea (North Korea) | Islamic Republic of Iran; Republic of the Union of Myanmar | Barbados, Burkina Faso, United Arab Emirates, Gibraltar, Cayman Islands, Jamaica, Hashemite Kingdom of Jordan, Republic of South Africa, Republic of Albania, Syrian Arab Republic, Republic of Cameroon, Republic of Croatia, Democratic Republic of the Congo, Federal Republic of Nigeria, Republic of the Philippines, Republic of Haiti, Republic of Yemen, Republic of Mali, Republic of Mozambique, Republic of Panama, Republic of Senegal, Socialist Republic of Vietnam, Republic of South Sudan, Republic of Turkey, Republic of Uganda; United Republic of Tanzania | -- PLenary MEETING 22-24 FEBRUARY 2023 | Democratic People's Republic of Korea (North Korea) | Islamic Republic of Iran; Republic of the Union of Myanmar | Barbados, Burkina Faso, United Arab Emirates, Gibraltar, Cayman Islands, Jamaica, Hashemite Kingdom of Jordan, Republic of South Africa, Republic of Albania, Syrian Arab Republic, Democratic Republic of the Congo, Federal Republic of Nigeria, Republic of the Philippines, Republic of Haiti, Republic of Yemen, Republic of Mali, Republic of Mozambique, Republic of Panama, Republic of Senegal, Republic of South Sudan, Republic of Turkey, Republic of Uganda; United Republic of Tanzania | Kingdom of Cambodia; Kingdom of Morocco

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III. PROCEDURES AND MEASURES TO BE ADOPTED BY INSTITUTIONS
Considering the content of the documents produced by the FATF and within the framework of the duty to disseminate information to which supervisory authorities are bound (Article 120 of Law No. 83/2017, of August 18 - “Law No. 83/2017”), the Bank of Portugal informs the following, regarding business relationships, occasional transactions, and operations carried out with persons, entities, and collective interest centers without legal personality1 residing or established in the jurisdictions identified below:
a. Considering the existence of a very high risk of money laundering, terrorist financing, and proliferation of weapons of mass destruction, it is determined, under the terms and for the purposes of paragraph 1, letter b) of Article 99 of Law No. 83/2017, the adoption of countermeasures, proportional to those risks, regarding the DEMOCRATIC PEOPLE'S REPUBLIC OF KOREA (NORTH KOREA) and the ISLAMIC REPUBLIC OF IRAN, which must in any case include the countermeasures identified in letters f) to h) and k) of paragraph 3 of Article 99 of the aforementioned Law No. 83/2017. b. Enhanced identification and due diligence measures shall continue to be adopted, under paragraph 2 of Article 36 and letter b) of paragraph 3 of Article 37 of the aforementioned Law No. 83/2017, and examined with special care, all business relationships, occasional transactions, and operations involving the DEMOCRATIC PEOPLE'S REPUBLIC OF KOREA (NORTH KOREA) or the ISLAMIC REPUBLIC OF IRAN – necessarily including the measures specified in the High-Risk Jurisdictions Subject to a Call For Action –, as well as the REPUBLIC OF THE UNION OF MYANMAR.
c. Regarding business relationships, occasional transactions, and operations involving jurisdictions subject to a monitoring process, or other high-risk third countries included in Delegated Regulation (EU) 2016/1675 of the Commission, of July 14, 2016, in its currently valid version, enhanced measures that are proportional to the specifically identified risk shall be adopted, without prejudice to the above, under paragraph 2 of Article 36, paragraph 1, and letter b) of paragraph 3 of Article 37, all of the aforementioned Law No. 83/2017.
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Supplementary information on the conclusions of the FATF plenary meeting can be obtained on the website www.fatf-gafi.org.

1 Including their respective representatives and beneficial owners.