Article 9.2 of the Fourth EU Money Laundering Directive (Fourth Directive) allows the European Commission (EC) to identify 'high-risk third countries'.
These countries are identified as having strategic deficiencies in their national anti-money laundering and counter-financing of terrorism regimes that pose significant threats to the EU’s financial system.
You must apply enhanced due diligence (EDD) measures in any transaction or business relationship with a person established in a high-risk third country.
High-risk third countries
The EU’s 5th Money Laundering Directive broadened the criteria for the EC in assessing high-risk third countries.
The EC has recently made some changes to the list that will take effect later in 2020.
Twenty-eight countries have currently been identified as high-risk third countries for money laundering and terrorist financing. They are:
- The Bahamas*
- Democratic People's Republic of Korea (DPRK) – has repeatedly failed to address deficiencies
- Iran – seeking technical assistance in the implementation of the FATF Action Plan
- Trinidad and Tobago
*These countries will be added to the list from 1 October 2020
View the EC’s original list of high-risk third countries (July 2016)
The list was later amended in four delegate regulations: