Financial Crime World

Egypt’s Know Your Customer (KYC) Policies: A Comprehensive Guide

The Know Your Customer (KYC) regulations in Egypt are a crucial aspect of the country’s anti-money laundering (AML) framework. These guidelines require financial institutions and other businesses to verify the identity, suitability, and risks associated with maintaining a business relationship with clients.

National Regulatory Framework

Anti-Money Laundering Law No. 80 of 2002

Egypt’s Anti-Money Laundering law No. 80 of 2002 and its executive regulation constitute the national regulatory framework for AML. The law came into effect in 2002 and has undergone several amendments since then.

Money Laundry & Terrorist Financing Combating Unit

The Money Laundry & Terrorist Financing Combating Unit, established under the Central Bank of Egypt, is responsible for reviewing suspicious transaction reports from financial institutions and other organizations.

Customer Due Diligence

Conducting a thorough KYC process is essential before establishing any business relationship with clients. This involves obtaining personal details from customers, including:

  • For natural persons:
    • Full name
    • Nationality
    • Date of birth
    • Gender
    • Registered address
    • Phone number
    • Email address (if available)
    • Job title
    • Workplace address
    • Purpose of creating an account
    • Information about parties who have control or access to the bank account
  • For juristic persons:
    • Company’s commercial register
    • Tax Card
    • Minutes of the board of directors meeting
    • Shareholders’ identification documents (Passports) for those owning at least 25% of the company shares
    • Authorized signatories’ IDs

Outsourcing Customer Due Diligence

In Egypt, financial institutions can outsource customer due diligence to third parties that are not obliged by law to meet AML regulations. However, the obligated party remains liable for maintaining regulatory compliance and fulfilling AML and KYC obligations.

Third-Party Requirements

There is no need for an outsourcing company to obtain a license to perform customer due diligence on behalf of the obligated party. Nevertheless, the actions of such a third party are attributed to the obliged party as its own actions.

Entities That Can Be Relied Upon as Third Parties

The following entities can be relied upon specifically by law as third parties to comply with AML regulations:

  • Credit institutions
  • Financial institutions
  • Auditors, external accountants, and tax advisors
  • Notaries and other independent legal professionals
  • Other trust or company service providers
  • Estate agents

Conclusion

Egypt’s Know Your Customer policies play a vital role in preventing money laundering and terrorist financing. Businesses operating in Egypt must adhere to these regulations to ensure compliance with AML laws and maintain their reputation.