Circular Letter No. 02/2023

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CIRCULAR LETTER NO. 02/2023
SUBJECT: FINANCIAL SYSTEM

• Disclosure of Financial Action Task Force (FATF) Measures

Considering the need to protect the International Financial System from Risks Associated with Money Laundering, Terrorism Financing, and Proliferation of Weapons of Mass Destruction, the Financial Action Task Force (FATF) held a plenary session between February 20 and 24, 2023, to define policies for preventing and interrupting financial flows that sustain crime and terrorism, highlighting the disclosure of the following documents:

1. HIGH-RISK JURISDICTIONS SUBJECT TO THE APPLICATION OF COUNTERMEASURES
   The document identifies jurisdictions subject to countermeasures and those with strategic deficiencies in money laundering and terrorism financing (ML/TF) prevention that have not yet made sufficient progress to address these deficiencies and/or have not agreed with the FATF on an action plan for this purpose. On the other hand, the list of high-risk jurisdictions subject to countermeasures has remained unchanged since the February 2020 plenary session to date. Information on countries subject to countermeasures is indicated on the FATF website, via the link: https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Call-for-action-February-2023.html, namely: Democratic People's Republic of Korea (North Korea), Islamic Republic of Iran.

2. JURISDICTIONS SUBJECT TO A SPECIAL ASSESSMENT OF ASSOCIATED RISKS
   A new category has been included, which can be consulted at the link:
   https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Call-for-action-February-2023.html, which lists the Union of Myanmar.

3. JURISDICTIONS UNDER CONTINUOUS MONITORING
   The document identifies jurisdictions with strategic deficiencies in ML/TF prevention that have developed an action plan to address them, and are subject to a monitoring process by the FATF. For these jurisdictions, general enhanced due diligence measures are not strictly required; however, all jurisdictions are encouraged to consider the status of countries on this list when conducting their risk assessments. The list of countries in the situation described in this point, also known as the "grey list", as well as the status of their systems for preventing and combating money laundering, terrorism financing, and proliferation of weapons of mass destruction, are indicated on the FATF website and can be consulted via the following link: https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Increased-monitoring-february-2023.html, namely: Albania, Barbados, United Arab Emirates, Burkina Faso, Cayman Islands, Gibraltar, Haiti, Yemen, Jamaica, Jordan, Mali, Panama, Philippines, Senegal, South Sudan, Syria, Turkey, Uganda, Mozambique, Tanzania, Democratic Republic of the Congo, South Africa, and Nigeria.

4. JURISDICTIONS NOT SUBJECT TO CONTINUOUS MONITORING BY THE FATF
   The document identifies jurisdictions that, having fulfilled their action plan, have been removed from the so-called "grey list" and are no longer under quarterly monitoring by the FATF. This list can be consulted via the following link: https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Increased-monitoring-february-2023.html, namely: the Kingdom of Cambodia and Morocco.

5. PROCEDURES AND MEASURES TO BE ADOPTED BY FINANCIAL INSTITUTIONS
   Considering the content of documents produced by the FATF and within the framework of the information dissemination duty to which supervisory authorities are subject under Article 55 of Law No. 05/20, dated January 27 (Law on the Prevention and Combating of Money Laundering, Terrorism Financing, and Proliferation of Weapons of Mass Destruction), the National Bank of Angola hereby directs the following:
   a) For countries or jurisdictions in the situation described in point No. 1 of this circular and indicated on the FATF website:
   i) Considering the existence of a high risk of money laundering, terrorism financing, and proliferation of weapons of mass destruction, it is determined, under the terms and for the purposes of paragraph 2 of Article 28 of Law No. 05/20, dated January 27, the adoption of countermeasures proportional to those risks; ii) The countermeasures to be applied by Financial Institutions may include, among others, the following:
   a. Limiting business relationships or financial operations with the identified country or persons in that country; b. Requiring Financial Institutions to review, modify, or, if necessary, terminate correspondent relationships with institutions in the country in question;
   c. Imposing enhanced external audit obligations for financial groups regarding their branches and subsidiaries located in the country in question;
   d. Prohibiting Financial Institutions from using third parties located in the country in question to carry out segments of the customer due diligence process; and e. Introducing relevant enhanced reporting mechanisms or systematic declaration of financial operations.

b) Enhanced due diligence measures, in accordance with paragraph 1 of Article 28 of Law No. 05/20, dated January 27, must be adapted and carefully examined for all business relationships, occasional transactions, and operations involving the Union of Myanmar. c) If deemed insufficient, applied or to be applied enhanced due diligence measures may lead to the decision not to initiate or to terminate business relationships or transactions. d) For countries or jurisdictions in the situation described in point No. 3 of this circular and indicated on the FATF website, enhanced due diligence measures proportional to the specifically identified risk must be applied, in accordance with Article 14 of Law No. 05/20, dated January 27.

6. Supplementary information on the conclusions of the FATF plenary session may be obtained on the official FATF website at: https://www.fatf-gafi.org/en/publications/Fatfgeneral/outcomes-fatf-plenary-february-2023.html;
7. This Circular Letter enters into force on the date of its publication.

Luanda, March 01, 2023.
DEPARTMENT OF FINANCIAL CONDUCT

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Osvaldo Manuel Pedro dos Santos
-Director-