Circular Letter No. CC/2024/00000026: Disclosure of FATF Communications (June 2024 Plenary Meeting)

Circular Letter No. CC/2024/00000026
Sent to:
Credit Institutions, Financial Companies, Payment Institutions, and Electronic Money Institutions.
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Subject: Disclosure of FATF communications (June 2024 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 foster adequate compliance with AML/CFT standards, the FINANCIAL ACTION TASK FORCE (FATF) acts to identify jurisdictions that present 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 26 and 28, 2024, the FATF published the following documents:
a. HIGH-RISK JURISDICTIONS SUBJECT TO A CALL FOR ACTION, dated June 28, 2024, which identifies jurisdictions subject to countermeasures and jurisdictions with strategic deficiencies in the prevention of money laundering and terrorist financing 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-2024.html b. JURISDICTIONS UNDER INCREASED MONITORING, dated June 28, 2024, which identifies jurisdictions with strategic deficiencies in the prevention of money laundering and terrorist financing 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/en/publications/High-risk-and-other-monitored-jurisdictions/increased-monitoring-june-2024.html

Regarding these documents, the following should be noted:

• Regarding the list of High-Risk Jurisdictions Subject to a Call for Action:
  The FATF reiterates its call for the application of countermeasures against the Democratic People's Republic of Korea (North Korea) and the Islamic Republic of Iran, emphasizing an increased risk of proliferation financing (“Given heightened proliferation financing risks, the FATF reiterates its call to apply countermeasures on these high-risk jurisdictions.”), particularly vis-à-vis the Democratic People's Republic of Korea (North Korea) given the increased link between this jurisdiction and the international financial system.

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 therefrom, and the FATF has updated its communication regarding the same.

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• Regarding the list of Jurisdictions Under Increased Monitoring:
• Since February 2024, the FATF has assessed the progress of 17 jurisdictions, and their statements have been updated;
• Regarding the Republic of Kenya, the Republic of Namibia, the Syrian Arab Republic, and the Republic of Yemen, previous FATF statements were included in this document, but these may not reflect the current state of their respective money laundering and terrorist financing prevention regimes;
• Two new jurisdictions have been identified and included: the Bolivarian Republic of Venezuela and the Principality of Monaco;
• It is noted that two jurisdictions have exited: Jamaica and the Republic of Turkey.

In addition, it is important to note the continued maintenance of the suspension of the membership status of the Russian Federation.

II. COMPARATIVE FRAMEWORK WITH COMMUNICATIONS ISSUED BY THE FATF IN FEBRUARY 2024

HIGH-RISK JURISDICTIONS SUBJECT TO A CALL FOR ACTION | JURISDICTIONS UNDER INCREASED MONITORING JURISDICTIONS SUBJECT TO COUNTERMEASURES | JURISDICTIONS SUBJECT TO ENHANCED MEASURES | JURISDICTIONS SUBJECT TO A MONITORING PROCESS | JURISDICTIONS THAT EXITED THE MONITORING PROCESS

PLENARY MEETING
26-28 JUNE 2024
Democratic People's Republic of Korea (North Korea) | Islamic Republic of Iran; Republic of the Union of Myanmar | Burkina Faso, Republic of Bulgaria, Republic of Cameroon, Republic of Croatia, Democratic Republic of the Congo, Republic of Haiti, Republic of Kenya, Republic of Mali, Republic of Mozambique, Republic of Namibia, Federal Republic of Nigeria, Republic of the Philippines, Republic of Senegal, Republic of South Africa, Republic of South Sudan, Syrian Arab Republic, United Republic of Tanzania, Socialist Republic of Vietnam, Republic of Yemen, Bolivarian Republic of Venezuela, and Principality of Monaco; | Jamaica and Republic of Turkey

PLENARY MEETING
21-23 FEBRUARY 2024
Democratic People's Republic of Korea (North Korea) | Islamic Republic of Iran; Republic of the Union of Myanmar | Burkina Faso, Republic of Bulgaria, Republic of Cameroon, Jamaica, Republic of Kenya, Republic of South Africa, Syrian Arab Republic, 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 Namibia, Republic of Senegal, Socialist Republic of Vietnam, Republic of South Sudan, Republic of Turkey, United Republic of Tanzania; | Barbados, Gibraltar, Republic of Uganda, and United Arab Emirates

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III. PROCEDURES AND MEASURES TO BE ADOPTED BY INSTITUTIONS

Taking into account the content of the documents produced by the FATF and within the scope 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(b) of Article 99 of Law No. 83/2017, the maintenance 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 paragraphs (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 the terms of paragraph 2 of Article 36 and paragraph 3(b) of Article 37 of the aforementioned Law No. 83/2017, and 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, shall be examined with special care.

c. Regarding business relationships, occasional transactions, and operations involving jurisdictions subject to a monitoring process, or other high-risk third countries that are part of 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 must be adopted, without prejudice to the above, under the provisions of paragraph 2 of Article 36, and paragraph 1 and paragraph 3(b) 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.