Liechtenstein Banking Industry Adapts to Regulatory Updates
Staying Compliant with Anti-Money Laundering and Terrorism Financing Regulations
The banking industry in Liechtenstein is continuously evolving to meet the challenges of regulatory updates aimed at maintaining transparency and preventing financial crimes. As a member state of the European Economic Area (EEA), Liechtenstein has implemented key EU directives on anti-money laundering and terrorism financing.
Regulatory Framework
Banks in Liechtenstein are primarily subject to two key regulations:
- Act of 21 October 1992 on Banks and Securities Firms (Banking Act)
- Ordinance of 22 February 1994 on Banks and Securities Firms
The Financial Market Authority (FMA) oversees compliance with these requirements through ongoing supervision, which includes direct contact with bank boards and management, as well as reliance on audit reports from external auditors.
EU Directives and National Implementation
Liechtenstein has implemented key EU directives such as:
- 4th Anti-Money Laundering Directive
- 5th Anti-Money Laundering Directive
- Regulation (EU) 2015/847 on information accompanying transfers of funds
These implementation provisions are found in the national Law of 11 December 2008 on Professional Due Diligence for the Prevention of Money Laundering, Organised Crime and Financing of Terrorism.
Additional Laws and Ordinances
Banks and securities firms in Liechtenstein must also comply with various laws and related ordinances, including:
- Payment Services Act
- Act on Settlement Finality in Payment and Securities Settlement Systems
- Investment Undertakings Act
The country has recently revised its due diligence obligations to align with international requirements and standards.
FMA’s Role in Oversight
The Financial Market Authority plays a crucial role in overseeing the banking industry’s compliance with these regulations, working closely with external auditors who possess a licence from the authority. The country’s system of dual supervision ensures that banks meet their legal requirements, preventing financial crimes such as money laundering and terrorism financing.
Conclusion
In conclusion, the banking industry in Liechtenstein continues to adapt to regulatory updates aimed at maintaining transparency and preventing financial crimes. By implementing key EU directives and national laws, the country is ensuring that its banking system remains compliant with international standards and regulations.