HM Treasury has today issued an Advisory Notice regarding Money Laundering and Terrorist Financing Controls in High-Risk Third Countries (HRTC). From today (22 January 2024), there is no longer a separate schedule to the MLRs (previously Schedule 3ZA) which contains the list of high risk third countries. Instead, a high risk third country is now defined as
a country named on either of the following lists published by the Financial Action Task Force as they have effect from time to time –
(i) High-Risk Jurisdictions subject to a Call for Action (black list);
(ii) Jurisdictions under Increased Monitoring (grey list).
Regulation 33(1)(b) of the MLRs requires firms to apply enhanced customer due diligence measures and enhanced ongoing monitoring in any business relationships with a person established in a HRTC or in relation to any relevant transaction where either of the parties to the transaction is established in a HRTC.
In order to keep abreast of which countries are HRTCs, firms will now have to refer directly to lists published by the Financial Action Task Force (‘FATF’) of ‘Jurisdictions Under Increased Monitoring’ and ‘High-Risk Jurisdictions subject to a Call for Action’. These lists are updated three times a year, on the final day of each FATF Plenary meeting, held every February, June and October. The dates of these meetings are published several months in advance, in the events calendar on the FATF website. The FATF list of countries are updated and published in full on the FATF website.
Through this amendment, no additional or different countries currently come into scope of enhanced due diligence obligations, as the former Schedule 3ZA, which contained the UK list of HRTCs, mirrored the current FATF lists (see the below for current jurisdictions on these lists).
For further information see: