Uniform Law on Combating Money Laundering and Terrorist Financing in UMOA Member States

ANNEX TO DECISION NO. 26 of 07/02/2015/CM/UMOA ADOPTING THE UNIFORM LAW PROJECT ON COMBATING MONEY LAUNDERING AND TERRORIST FINANCING IN THE MEMBER STATES OF THE WEST AFRICAN MONETARY UNION (UMOA)

WEST AFRICAN MONETARY UNION

PROJET DE LOI UNIFORME ON COMBATING MONEY LAUNDERING AND TERRORIST FINANCING IN THE MEMBER STATES OF THE WEST AFRICAN MONETARY UNION (UMOA)

PRELIMINARY TITLE: TERMINOLOGY
Article 1: Definitions
For the purposes of this Law, the following terms shall mean:

1. terrorist act:
   – an act constituting an offense under one of the international legal instruments listed in the annex to this Law; – any other act intended to kill or seriously injure a civilian, or any other person not directly participating in hostilities during an armed conflict, when, by its nature or context, such act aims to intimidate a population or compel a Government or an international organization to do or abstain from doing any act;

2. regional financial market actors: central structures (Regional Securities Market – BRVM, Central Depository/Settlement Bank) and commercial participants (Management and Intermediation Companies, Wealth Management Companies, Stock Investment Advisors, Business Introducers and Sales Agents);

3. bearer shares: negotiable instruments by simple delivery, representing ownership of a fraction of the share capital of a public limited company;

4. criminal activity: any criminal or delictual act constituting an underlying offense for money laundering and terrorist financing at ... (cite the name of the concerned member State);

5. perpetrator: any person who participates in the commission of a crime or offense;

6. competent authority: the body that, by virtue of a law or regulation, is authorized to perform or order the acts or measures provided for in this Law;

7. supervisory authorities: the national or UMOA/UEMOA community authorities authorized, by virtue of a law or regulation, to supervise the natural and legal persons referred to in Articles 5 and 6 of this Law;

8. prosecuting authority: the body that, by virtue of a law or regulation, is vested, even on an occasional basis, with the mission of exercising public action;

9. judicial authority: the body authorized, by virtue of a law or regulation, to perform acts of prosecution or investigation or to render judicial decisions;

10. public authorities: national administrations and those of local government bodies within the Union, as well as their public establishments;

11. shell bank: a bank that has been incorporated and approved in a State where it has no physical presence and is not affiliated to a regulated financial group subject to consolidated and effective supervision. The expression "physical presence" refers to the presence of a management body and decision-making power in a country. The simple physical presence of a local agent or subordinate staff does not constitute a physical presence;

12. beneficial owner or economic entitlement holder: the natural person(s) who, ultimately, own or control a client and/or the natural person on whose behalf an operation is carried out. This definition also includes persons who ultimately exercise effective control over a legal entity or legal arrangement as defined in point 21 below;
    – when the client of one of the persons mentioned in Article 5 of this Law is a company, the beneficial owner of the operation refers to the natural person(s) who either hold, directly or indirectly, more than twenty-five percent of the share capital or voting rights of the company, or exercise, by any other means, control over the management, administration or direction bodies of the company or its general meeting; – when the client of one of the persons mentioned in Article 5 of this Law is a collective investment scheme, the beneficial owner of the operation refers to the natural person(s) who either hold, directly or indirectly, more than twenty-five percent of the shares or units of the scheme, or exercise control over the administration or direction bodies of the collective investment scheme or, where applicable, the management company or portfolio management company representing it; – when the client of one of the persons mentioned in Article 5 of this Law is a legal entity that is neither a company nor a collective investment scheme, or when the client acts within the framework of a trust or any other comparable legal arrangement under foreign law, the beneficial owner of the operation refers to the natural person(s) satisfying one of the following conditions:
    1°) they are destined, by virtue of a legal instrument designating them for this purpose, to become holders of rights covering at least twenty-five percent of the assets of the legal entity or assets transferred to a trust estate or any other comparable legal arrangement under foreign law; 2°) they belong to a group in whose primary interest the legal entity, trust or other comparable legal arrangement under foreign law was established or produced its effects, when the natural persons who are the beneficiaries have not yet been designated; 3°) they hold rights covering at least twenty-five percent of the assets of the legal entity, trust or other comparable legal arrangement under foreign law; 4°) they hold the status of settlor, trustee or beneficiary, in accordance with current legislative and regulatory texts;

13. BCEAO or Central Bank: the Central Bank of West African States (BCEAO);

14. assets: holdings of any nature, corporeal or incorporeal, movable or immovable, tangible or intangible, fungible or non-fungible, as well as documents or legal instruments in any form whatsoever, including electronic or digital, attesting ownership of such holdings or rights related thereto, as well as interests on said assets, namely credits, traveler's checks, checks, money orders, shares, securities, bonds, bills of exchange or letters of credit, as well as any interest, dividends or other revenues or value derived from or generated by such assets;

15. money laundering: the offense defined in Article 7 of this Law;

16. designated categories of offenses:
    – participation in an organized criminal group and participation in racketeering; – terrorism, including its financing; – human trafficking and illicit traffic in migrants; – sexual exploitation, including the diversion and exploitation of minors; – illicit traffic in narcotic drugs and psychotropic substances; – illicit traffic in arms; – illicit traffic in stolen goods and other property; – corruption and extortion; – misappropriation of funds by persons holding public office; – fraud; – counterfeiting of currency; – counterfeiting of goods (including currency or banknotes) and product piracy; – organ trafficking; – environmental offenses; – murder and serious bodily injury; – kidnapping, hostage-taking and abduction; – theft; – smuggling (including regarding taxes and customs and excise duties); – tax offenses (related to direct and indirect taxes); – extortion; – forgery and use of forged instruments; – piracy; – insider dealing and market manipulation; – any other crime or offense.

17. CENTIF: the National Financial Intelligence Unit (CENTIF);

18. CIMA: the Interafrican Conference of Insurance Markets (CIMA);

19. occasional customer: any person who approaches one of the persons subject to this Law, pursuant to Articles 5 and 6, for the exclusive purpose of preparing or carrying out a single transaction or being assisted in preparing or carrying out such a transaction, whether carried out in a single operation or in several operations appearing to be linked;

20. confiscation: the definitive deprivation of assets, by decision of a competent court or any competent authority;

21. legal arrangements: express trusts or similar legal arrangements;

22. correspondent banking: commercial relations between a credit institution established in ... (indicate the name of the member State adopting this Law) and a credit institution established in another State.

23. CRF: Financial Intelligence Units (CRF);

24. Designated Non-Financial Businesses and Professions (DNFBPs):
    a) casinos, including online casinos; b) real estate agents and property brokers; c) persons who habitually deal in or organize the sale of precious stones, precious metals, antiques and works of art; d) lawyers, notaries and other independent legal professionals when they prepare or effectuate transactions for a client, within the framework of the following activities:
    – purchase and sale of real estate;
    – management of clients' capital, securities or other assets; – management of accounts, including securities accounts; – organization of contributions for the establishment, operation or management of companies, or establishment, operation or management of legal entities or legal arrangements, and purchase and sale of commercial entities. e) accounting and audit professionals; f) corporate and trust service providers, not covered elsewhere in this Law, who provide the following services commercially to third parties:
    – by acting as agents for the establishment, registration and management of legal entities, namely trusts; – by acting or making the necessary arrangements for another person to act as a director or company secretary of a capital company, a partner in a partnership, or a holder of a similar function for other legal entities; – by providing a registered office, business address or premises, an administrative or postal address to a capital company, a partner in a partnership, or any other legal entity or legal structure; – by acting or making the necessary arrangements for another person to act as a trustee of an express trust, or a holder of a similar function for other legal entities; – by acting or making the necessary arrangements for another person to act as a shareholder acting on behalf of another person. g) other businesses or professions that may be designated by the competent authority;

25. member State: the State party to the Treaty of the West African Monetary Union and the Treaty of the West African Economic and Monetary Union;

26. third State: any State other than a member State;

27. trust: the operation by which one or more settlors transfer assets, rights or securities, or a set of present or future assets, rights or securities, to one or more trustees who, holding them separate from their own estate, act for a determined purpose in the benefit of one or more beneficiaries;

28. financing of proliferation: the financing of the proliferation of weapons of mass destruction, namely nuclear, chemical, bacteriological or biological weapons, by acts proscribed by Resolution 1540 (2004) and successive resolutions of the United Nations Security Council relating to the prevention, repression and interruption of the proliferation of weapons of mass destruction and its financing;

29. terrorist financing: the offense defined in Article 8 of this Law;

30. funds and other financial assets: all financial assets and economic benefits of any nature whatsoever, including but not exclusively cash, checks, cash claims, bills of exchange, payment orders and other payment instruments, deposits with financial institutions, account balances, claims and debt securities, traded securities and debt instruments, notably shares and other equity instruments, certificates of title, bonds, promissory notes, warrants, unencumbered securities, derivatives contracts, interest, dividends or other revenues from assets or capital gains received on assets, credit, right of set-off, guarantees, including performance bonds or other financial commitments, letters of credit, bills of lading, sales contracts, any document attesting ownership of shares in a fund or financial resources and any other export financing instrument;

31. freezing:
    a) in the context of confiscation and provisional measures, the prohibition on transfer, conversion, disposal or movement of any asset, equipment or instrument following a measure taken by a competent authority or court under a freezing mechanism, for the duration of validity of said measure, or until a confiscation decision is taken by a competent authority; b) for the purposes of recommendations on the implementation of targeted financial sanctions, the prohibition on transfer, conversion, disposal or movement of all funds and other assets owned or controlled by designated persons or entities following a measure taken by the United Nations Security Council or a competent authority or court in accordance with applicable Security Council resolutions, for the duration of validity of said measure.

32. serious offense: an act constituting an offense punishable by a deprivation of liberty sentence, the minimum of which must not be less than three years;

33. underlying offense: any offense, even committed in the territory of another member State or a third State, which generates proceeds from criminal activity;

34. government or public facility: any permanent or temporary facility or means of transport used or occupied by representatives of a State, members of the Government, Parliament or judiciary, or agents or personnel of a State or any other authority or public entity, or by agents or personnel of an intergovernmental organization, in the course of their official functions;

35. financial institution: any person or entity that commercially exercises one or more of the following activities or operations on behalf and for the account of a client:
    a) acceptance of deposits and other refundable funds from the public; b) lending, including consumer credit, mortgage credit, factoring with or without recourse, financing of commercial transactions; c) leasing, except for consumer leasing; d) money or value transfer; e) issuance and management of payment instruments; f) granting of guarantees and underwriting of commitments; g) trading on:
    – money market instruments;
    – foreign exchange market;
    – foreign exchange, interest rate and index instruments; – securities; – commodity futures and options markets. h) participation in securities issuances and provision of related financial services; i) individual and collective wealth management; j) safekeeping and administration of securities, in cash or liquid form, for the account of others; k) other investment, administration or fund/money management operations for the account of others; l) underwriting and placement of life and non-life insurance products and other investment products linked to insurance; m) manual foreign exchange; n) all other activities or operations determined by the competent authority. The following are designated as financial institutions:
    – credit institutions;
    – postal financial services, as well as deposit and consignment funds or equivalent bodies of member States; – insurance and reinsurance companies, insurance and reinsurance brokers, and general insurance agents; – decentralized financial systems; – central structures of the Regional Financial Market (BRVM, Central Depository/Settlement Bank) as well as Management and Intermediation Companies, Wealth Management Companies and all other commercial participants with the status of financial institution, pursuant to texts governing the Regional Financial Market; – Collective Investment Schemes in Securities (UCITS); – Fixed Capital Investment Companies; – Authorized Manual Foreign Exchange Dealers; – Electronic Money Institutions; – any other structure determined by the competent authority.

36. foreign financial institutions: financial institutions established in a third State;

37. instrument: any asset used or to be used wholly or in part and in any manner whatsoever for the commission of a criminal offense;

38. bearer negotiable instruments: all monetary bearer instruments such as:

• traveler's checks;
• negotiable instruments (notably checks, promissory notes and money orders) that are either to bearer, or freely endorsable, or made out to a fictitious beneficiary, or in any other form allowing transfer by simple delivery;
• incomplete instruments (notably checks, promissory notes and money orders) signed, but on which the name of the beneficiary has been omitted.

39. manual foreign exchange transaction: the immediate exchange of banknotes or currencies denominated in different currencies, carried out by transfer or delivery of cash, against settlement by another payment instrument denominated in a different currency;

40. criminal organization: any structured agreement or association aimed at committing, notably money laundering, terrorist financing or proliferation of weapons of mass destruction offenses;

41. non-profit organization or entity: any association, foundation, or non-governmental organization constituted in accordance with current legislative and regulatory texts, whose main purpose is the collection or distribution of funds for charitable, religious, cultural, educational, social or fraternal purposes, or for other types of public benefit;

42. terrorist organization: any group of terrorists that:
    a) commits or attempts to commit terrorist acts by any means, direct or indirect, illegally and deliberately; b) participates, as an accomplice, in terrorist acts; c) organizes terrorist acts or encourages others to commit them; d) contributes to the commission of terrorist acts by a group of persons acting with a common purpose, when this contribution is deliberate and aims to facilitate the terrorist act or is provided knowing the group's intention to commit a terrorist act;

43. money couriers: persons who carry out physical cross-border transports of cash or bearer negotiable instruments, or who knowingly assist in carrying out such operations;

44. Politically Exposed Persons (PEPs):

• foreign PEPs: natural persons who exercise or have exercised important public functions in another member State or a third State, namely:
  a) Heads of State or Government, Ministers, Deputy Ministers and Secretaries of State; b) members of royal families; c) Directors General of ministries; d) parliamentarians; e) members of supreme courts, constitutional courts or other high courts whose decisions are not subject to appeal, except in exceptional circumstances; f) members of audit courts or boards/directorates of central banks; g) ambassadors, chargé d'affaires and senior officers of the armed forces; h) members of the administration, management or supervisory bodies of public enterprises; i) senior officials of political parties; j) members of a PEP's family, namely:
  – spouse;
  – any partner considered equivalent to a spouse; – children and their spouses or partners; – other relatives; k) persons known to be closely associated with a PEP; l) any other person designated by the competent authority.
• national PEPs: natural persons who exercise or have exercised important public functions at ... (cite the name of the concerned member State), notably the natural persons referred to in a) to i) above;
• international organization PEPs: persons who exercise or have exercised important functions within or on behalf of an international organization, notably senior management, in particular directors, deputy directors and members of the Board of Directors and all persons exercising equivalent functions.
  The concept of PEP does not cover middle or lower-ranking persons belonging to the above categories.

45. proceeds from criminal activity: all funds derived, directly or indirectly, from the commission of an offense as provided for in Articles 7 and 8 of this Law or obtained, directly or indirectly, by committing said offense;

46. seizure: any conservatory measure carried out in the course of an investigation or search. Seizure may be ordered by a competent court or executed without judicial decision by any competent authority in the exercise of its functions. Its purpose is to place all assets of the suspect in the hands of the Judiciary or any competent authority for a specified period. The assets remain the property of the suspect;

47. money or value transfer service: a financial service whose activity consists of accepting cash, checks or any other payment instrument or deposit of value in a given location and paying an equivalent amount in cash or in any other form to a beneficiary located in another geographical zone by means of communication, message, transfer or clearing system to which the money...