Title: Libyan Arab Jamahiriya’s New Law to Counter Money Laundering: Key Provisions

Introduction

In an effort to strengthen its anti-money laundering (AML) regime and comply with international conventions, the General People’s Congress of the Libyan Arab Jamahiriya passed Law No. (4) of 2011 against illicit funds. This article highlights the essential definitions, provisions, and implications of the new law.

Key Definitions and Provisions

Illicit property: the new law defines property as illicit if it is acquired through a crime, be it domestic or international.
Freeze or seizure: the authorities can freeze or seize assets suspected of being illicit.
Confiscation: refers to the permanent forfeiture of illicit property to the state.
Financial institutions: the term now includes insurance companies and other similar establishments not supervised by the Central Bank.

Money Laundering Criminalized

Individuals who appropriate, possess, or conceal illicit property with the intention of disguising its origin are considered money laundering perpetrators. Accomplices involved in the laundering process are also held accountable.

Institutional Liability

Financial institutions: held criminally liable for money laundering activities committed on their behalf.
Penalties: fines equaling twice the amount of laundered funds and license withdrawal in case of recidivism.

Penalties for Money Laundering

Perpetrators face imprisonment and fines equivalent to the laundered funds, besides confiscation of the assets. Penalties for associates and accessories vary depending on their involvement.

Reporting Suspicious Transactions

Financial Information Unit (FIU): established within the Central Bank to deal with money laundering operations.
Obligations: financial, commercial, and economic institutions must report suspicious transactions to the FIU and provide regular updates.

International and Reciprocal Cooperation

Confidentiality: entities must maintain confidentiality of acquired information.
Information exchange: institutions can share information and reports with foreign counterparts in accordance with international agreements or reciprocity.

Judicial Cooperation with Other Countries

Proceeds of money laundering crimes: Libya may cooperate with foreign judicial entities to freeze, retain, or recover such proceeds or the instrumentalities involved.
Agreements: cooperation is allowed when the requesting country has a judicial cooperation agreement with Libya or when based on reciprocity.

Executive Regulation and Publications

Implementation details of the new law will be issued through executive regulations and publications by the Central Bank of Libya. Regulations will include anti-money laundering procedures, reporting methods, and other aspects of the AML regime.

Future Compliance and Enforcement

National Anti-Money Laundering Committee: issues regulations, facilitates information exchange, and represents Libya in international forums.
Compliance: all entities, including financial institutions and regulators, must comply with these regulations and report any suspected cases to the proper authorities.
Implementation: the Central Bank will institute anti-money laundering directives and oversee their implementation.

Confidentiality and Protection of Information

Information acquire during AML duties must be kept confidential and only disclosed when required for investigations, lawsuits, or legal actions related to money laundering and other criminal activities stipulated by the legislation.

This new legislation represents a significant step forward for the Libyan Arab Jamahiriya in its efforts to combat money laundering and related illicit activities.