Instructions No. 3 of 2016 on Combating Money Laundering and Terrorist Financing Regarding the Import of Used Cars from Outside the State of Palestine

Office of Fatwa and Legislation 108 Reference No. 124-8-2016: No. 124 2016/8/25

Instructions No. (3) of 2016 on Combating Money Laundering and Terrorist Financing Concerning the Activity of Importing Used Cars from Outside the State of Palestine

The National Committee for Combating Money Laundering and Terrorist Financing, Based on the provisions of Legislative Decree No. (20) of 2015 on Combating Money Laundering and Terrorist Financing, particularly Articles (1, 14, 15, 20/1), and Paragraph (6) of Table No. (2) attached thereto, And based on the powers delegated to us, And in pursuit of the public interest, We have issued the following Instructions:

Article (1)
The following words and expressions used in these Instructions shall have the meanings specified below, unless the context indicates otherwise:
The Law: Legislative Decree No. (20) of 2015 on Combating Money Laundering and Terrorist Financing.
The Unit: The Financial Monitoring Unit.
The Committee: The National Committee for Combating Money Laundering and Terrorist Financing.
Customs Administration: The General Administration of Customs, Duties, and Value Added Tax in the Ministry of Finance and Planning.
The Importer: The natural or legal person registered or licensed by the competent authorities to conduct the activity of importing used cars from outside the State of Palestine.

Article (2)
The provisions of these Instructions shall apply to the activity of importing used cars by importers into the State of Palestine.

Article (3)

1. The activity of importing used cars from abroad is considered an activity falling within high-risk activities in the context of combating money laundering and terrorist financing, and is among the specified non-financial businesses and professions listed in Table No. (2) attached to the Law.
2. The activity of importing used cars from abroad specified in paragraph (1) of this Article shall be subject to the same duties and obligations as the non-financial businesses and professions specified in the Law.

Office of Fatwa and Legislation 109 Reference No. 124-8-2016: No. 124 2016/8/25

Article (4)
The customs declaration for used cars imported from outside the State of Palestine shall not be issued until the Customs Administration obtains a certified copy of the letter of credit, or any transfer transaction, or any banking financial transaction conducted to pay for the imported used cars, subject to the following:

1. If the importer is a company, the banking financial transaction must have been conducted from/to the company's account as a legal entity.
2. If the importer is a natural person, the banking financial transaction must have been conducted from/to their personal account.

Office of Fatwa and Legislation 110 Reference No. 124-8-2016: No. 124 2016/8/25

Article (5)

1. The information required pursuant to the provisions of Article (4) shall serve the following purposes, whether individually or collectively:
   a. Mitigating the risks of money laundering operations resulting from smuggling crimes. b. Preventing the use of that activity for concealing criminal proceeds resulting from the commission of any predicate offense or the crime of terrorist financing.
   c. Verifying and documenting the integrity of the import process.
   d. Ensuring that imported used cars are not used as a means to cover funds that may be derived from illicit sources.
2. The required information shall not be considered for valuation purposes, and the value accepted for Customs Administration purposes shall remain as determined by the Customs Administration annually.

Article (6)
Banks shall take enhanced due diligence measures regarding financial transactions executed for the purpose of importing used cars from abroad, including:

1. Verifying the source and purpose of the funds.
2. Adopting a specific form for declaring the beneficial owner of those transactions.
3. Matching the applicant for the financial transaction for import purposes with the importer's own data.

Article (7)
The Customs Administration shall:

1. Formulate the policies and procedures necessary for conducting the activity of importing used cars from abroad for combating money laundering and terrorist financing, in accordance with the provisions of Article (3/13) of the Law.
2. Take the necessary measures related to its jurisdiction pursuant to the provisions of these Instructions.

Article (8)
The Monetary Authority shall:

1. Formulate the necessary measures for all operating banks and money transfer companies to implement the provisions of these Instructions.
2. Issue the necessary directives to financial institutions under its supervision and regulation to mitigate the risks of using the activity of importing used cars from outside Palestine for combating money laundering and terrorist financing crimes.

Article (9)
All competent authorities shall, each within their respective purview, implement the provisions of these Instructions effective from 2017/01/01, and they shall be published in the Official Gazette.

Issued in Ramallah on: 2016/07/25 Gregorian
Corresponding to: 20/1437/ Shawwal Hijri
The National Committee for Combating Money Laundering and Terrorist Financing