New Standards for French Pacific Territories SMEs: Regional and Financial Bank Updates Anti-Money Laundering and Terrorism Financing Guidelines

The regional and financial bank has updated its General Regulation (Book III) and the four guides that make up its anti-money laundering and terrorism financing policy (ABFT) to take into account legislative and regulatory changes resulting from the transposition of the fifth European directive on anti-money laundering.

Updated General Regulation

The General Regulation has been updated to take into account changes in legislation and regulations introduced by Ordinance No. 2020-115, Decrees Nos. 2020-118 and 2020-119. The scope of application of the ABFT obligations established in the General Regulation is aligned with that set out in Article L. 561-2 6° of the Monetary and Financial Code. This applies to:

• Managers of other investment companies (SIFs) mentioned in Article L. 214-24 III 3° of the Monetary and Financial Code
• Managers of EuVECA and EuSEF funds
• Subsidiaries established in France by European companies managing UCITS or SIF French assets

The General Regulation has also been amended to take into account the exemption provided for in Article R. 561-38-4 of the Monetary and Financial Code regarding financial investment advisors (FIAs) and participatory placement consultants (CPIs) with regard to presenting a report within the regional and financial bank on their internal control system organization.

Impact Documents

The following policy documents have been impacted:

• DOC-2019-15: Guide on risk-based approach to combating money laundering and terrorism financing
• DOC-2019-16: Guides on reasonable diligence obligations towards clients and beneficiaries
• DOC-2019-17: Guides on the concept of politically exposed persons (PEPs)
• DOC-2019-18: Guides on the obligation to declare to TRACFIN

Key Points

The main points to consider for this update are:

• The guides take into account legislative changes that require entities subject to examination to check the beneficiaries’ register of client companies listed in the Trade and Companies Register, unless the risk is low
• The guides take into account regulatory adjustments made when entities subject to examination use a third-party service to implement reasonable diligence obligations before entering into a commercial relationship or strengthening additional diligence measures when a transaction involves a high-risk country
• The regional and financial bank recommends that entities subject to examination establish a methodology in their internal procedures for evaluating the level of equivalence of ABFT obligations of foreign countries. To evaluate this level of equivalence, the regional and financial bank recommends that entities subject to examination consult not only lists compiled by the Organisation for Economic Co-operation and Development (OECD), but also public evaluation reports published by this organization
• Finally, the regional and financial bank has adjusted its position on reasonable diligence exercised by collective portfolio management companies towards lessees of buildings acquired by real estate funds they manage.