Tunisia Eyes Elimination of Bearer Shares

In an effort to bolster its anti-money laundering (AML) and combating the financing of terrorism (CFT) regime, Tunisia is contemplating eliminating bearer shares from its financial system.

Concerns over Transparency

Bearer shares have long been a concern in Tunisia’s financial sector due to their lack of transparency. The country’s Central Bank has taken steps to implement stricter regulations on financial institutions, requiring them to adopt AML/CFT practices and programs by 2003-75, the new banking law.

Criticisms over New Banking Law

The law establishes a mechanism for reporting suspicious or unusual transactions, which are subject to temporary suspension and freezing. However, experts have raised concerns over the ambiguity of the definitions of “unusual” and “suspicious” operations, as well as the lack of distinction between the two in the law.

Issues with Reporting Mechanism

The law’s requirement for automatic suspension and freezing of transactions has been criticized for creating a vague incentive system for reporting institutions. This has led to concerns over the effectiveness and readability of the reporting mechanism.

Eliminating Bearer Shares: A Crucial Step Forward

To address these issues, officials are considering eliminating bearer shares from the financial system. The move is seen as crucial in improving transparency and reducing the risk of money laundering and terrorist financing.

“Tunisia’s priority should be to ensure the proper operational functioning of its current reporting mechanism, despite its deficiencies,” said a senior official. “Eliminating bearer shares would also help reduce the complexity of the AML/CFT regime and improve cooperation with international authorities.”

Enhancing Cooperation

The country is also working to clarify the notions of unusual and suspicious transactions, as well as providing more guidance on the reporting obligations of financial institutions.

Strengthening Internal Controls

In related news, Tunisia’s banking law requires financial institutions to establish internal controls and risk management systems. The Central Bank has also issued directives aimed at strengthening the AML/CFT regime in the country’s financial sector.

The move towards eliminating bearer shares is seen as a crucial step forward in Tunisia’s efforts to strengthen its financial sector and improve cooperation with international authorities.