The European Commission, citing the FATF and onsite visits, has proposed to list Kenya among high-risk jurisdictions with deficiencies in anti-money laundering and countering the financing of terrorism (AML/CFT) regimes.
- •In addition to Kenya, the European Union’s main executive body wants to add nine other countries to the list: Algeria, Angola, Côte d’Ivoire, Laos, Lebanon, Monaco, Namibia, Nepal and Venezuela.
- •Meanwhile, other jurisdictions such as Barbados, Gibraltar, Jamaica, Panama, the Philippines, Senegal, Uganda, and the United Arab Emirates have been proposed for delisting.
- •In February 2024, Kenya was greylisted by the Financial Action Task Force (FATF), which sets global standards against money laundering and terrorism financing.
“Following a thorough technical assessment and after listening carefully to the concerns expressed around its last proposal, the Commission has now presented an update to the EU list which reiterates our strong commitment to aligning with international standards, particularly those set by the FATF,” said Maria Luís Albuquerque, Commissioner for Financial Services and the Savings and Investments Union.
“EU entities covered by the AML framework are required to apply enhanced vigilance in transactions involving these countries. This is important to protect the EU financial system.”
The updated list takes into account the work of the Financial Action Task Force (FATF) and in particular its list of “Jurisdictions under Increased Monitoring”. Uganda was placed in the FATF grey list in February 2020, four years after it was placed on the EU’s list of high risk countries. Kenya, Tanzania, South Sudan and the DRC are still on the FATF grey list.
Greylisting typically leads to negative market reaction, as countries and institutions often classify entities from greylisted nations as high-risk. This results in stricter due diligence, slower business processes, higher transaction costs, and potential damage to deals and business relationships.
Under bloc’s rules, the updated list will go into effect after scrutiny and non-objection by the European Parliament and the Council within one month.