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Vietnam’s New Anti-Money Laundering Law Takes Effect
Effective Date: March 1, 2023
Vietnam’s new Anti-Money Laundering Law (Law No. 14/2022/QH15) has come into effect, replacing the country’s existing anti-money laundering legislation.
Definition of Money Laundering
The law defines money laundering as an act to legitimize the origin of property obtained from a crime.
Obligations for Reporting Entities
Reporting entities, including financial institutions and organizations engaged in certain non-financial businesses, are required to implement measures against money laundering and comply with other obligations under the new law. These entities must:
- Collect and update customer identification information
- Conduct a money laundering risk assessment
- Apply risk-management measures based on the customers’ risk levels
- Report large-value transactions and suspicious transactions to the State Bank of Vietnam
Signs of Suspicious Transactions
The law lists signs of suspicious transactions according to business sector. Reporting entities must immediately apply measures to delay transactions for up to three working days in certain cases, including when there are grounds for suspecting that parties involved in transactions are on the black list or when there is reason to believe that the requested transaction is related to criminal activities.
Additional Requirements
The State Bank of Vietnam has been authorized to add specific activities that pose money laundering risks to reporting entities. The law also requires reporting entities to:
- Review the list of politically influential foreign individuals announced by the State Bank and take appropriate measures to verify the origin of assets of such customers and beneficial owners
- Implement additional measures to comply with international standards on anti-money laundering
Impact on Vietnam’s Financial Sector
Experts say the new law is aimed at strengthening Vietnam’s efforts to combat money laundering and terrorist financing, and to comply with international standards on anti-money laundering. The law is expected to have a significant impact on the country’s financial sector and its overall economic stability.
Source: Law Library of Congress