Circular Letter No. 07/2023, dated October 31

CARTA – CIRCULAR N.º 07/2023

ASSUNTO: SISTEMA FINANCEIRO

• Disclosure of Measures by the Financial Action Task Force (FATF)

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 from October 25 to 27, 2023, with the objective of defining policies for preventing and interrupting financial flows that support crime and terrorism. In this regard, the following documents are highlighted:

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 remains unchanged since the February 2020 plenary session to date. The countries subject to countermeasures 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/Call-for-action-october-2023.html Countries included in the aforementioned list: Democratic People's Republic of Korea (North Korea) and Islamic Republic of Iran.

2. JURISDICTIONS SUBJECT TO A SPECIAL RISK ASSESSMENT
   A new category has been included, which can be consulted via the link:
   https://www.fatf-gafi.org/en/publications/High-risk-and-other-monitored-jurisdictions/Call-for-action-october-2023.html The Union of Myanmar is included in the list associated with the new category.

3. JURISDICTIONS UNDER CONTINUOUS MONITORING
   The document identifies jurisdictions with strategic deficiencies in ML/TF that have developed an action plan to address them and are subject to a monitoring process by the FATF. This does not mandate the application of enhanced due diligence measures to the concerned jurisdictions; however, it encourages all jurisdictions to consider the status of countries listed here when conducting their risk assessments. The countries included in this situation, also known as the "grey list" countries, along with 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-october-2023.html Countries included in the aforementioned list: Barbados, United Arab Emirates, Burkina Faso, Gibraltar, Haiti, Yemen, Jamaica, Mali, Philippines, Senegal, South Sudan, Syria, Turkey, Uganda, Mozambique, Tanzania, Democratic Republic of the Congo, South Africa, Nigeria, Cameroon, Croatia, Vietnam, and Bulgaria.

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. The countries included in this situation 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-october-2023.html Countries included in the aforementioned list: Albania, Cayman Islands, Jordan, and Panama.

5. PROCEDURES AND MEASURES TO BE ADOPTED BY FINANCIAL INSTITUTIONS
   In view of the content of the documents produced by the FATF and within the scope of the information dissemination duty incumbent upon the supervisory authorities defined in 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 Banco Nacional de Angola hereby directs the following:
   a) For countries or jurisdictions in the situation described in section 1 of this circular and indicated on the FATF website:
   i) Considering the very high risk of Money Laundering, Terrorism Financing, and Proliferation of Weapons of Mass Destruction, it is determined, pursuant to 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 the following:
   a. Limit business relations or financial operations with the identified country or with persons in those countries; b. Evaluate the modification or, if necessary, terminate correspondent banking relationships with institutions in the countries in question;
   c. Impose enhanced external audit obligations for financial groups regarding their branches and subsidiaries located in the countries in question;
   d. Refrain from using third parties located in the countries in question to carry out segments of the customer due diligence process; and, e. Introduce relevant enhanced reporting mechanisms or systematic reporting of financial operations.

b) Enhanced due diligence measures shall be adopted, pursuant to paragraph 1 of Article 28 of Law No. 05/20, dated January 27, and all business relations, occasional transactions, and operations involving the Union of Myanmar shall be examined with special care; c) If the enhanced due diligence measures applied or to be applied are deemed insufficient, consider not initiating or terminating business relations or transactions; d) For countries or jurisdictions in the situation described in section 3 of this circular and indicated on the FATF website, enhanced due diligence measures shall be applied that are proportional to the specifically identified risk, pursuant to Article 14 of Law No. 05/20, dated January 27.

Additionally, it is important to note other measures adopted by the FATF regarding the maintenance of the suspension of the Russian Federation's membership status, which can be consulted here:
https://www.fatf-gafi.org/en/publications/Fatfgeneral/fatf-statement-russian-federation.html

Supplementary information regarding the conclusions of the FATF plenary meeting can be obtained on the official FATF website via the link below:
https://www.fatf-gafi.org/en/publications/Fatfgeneral/fatf-week-october-2023.html

This Circular Letter enters into force on the date of its publication.
Luanda, October 31, 2023.

FINANCIAL CONDUCT DEPARTMENT

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Eli Valentim de Castro
-Deputy Director-