Here is the article in markdown format:

Vietnam’s Anti-Money Laundering Law: Key Changes and Compliance Requirements

The Vietnamese government has taken significant steps to enhance the transparency of its financial system by implementing a revised Anti-Money Laundering (AML) Law in 2022. The updated law, which came into effect on March 1, 2023, introduces crucial changes aimed at preventing financial crimes, such as money laundering and corruption.

Definition of Money Laundering Expands

The new AML Law broadens the definition of money laundering to include activities that involve individuals or organizations seeking to legitimize properties obtained directly or indirectly from criminal activities. This expansion aims to cover a wider range of illicit transactions and prevent potential abuses.

Key Changes

• The revised law requires organizations that provide payment services, including digital wallet providers, collection, and payment services, to implement know-your-customer (KYC) measures.
• Reporting entities must verify the customer’s identity, assess their risk level, and monitor their transactions.

Businesses Affected by New Regulations

The following types of business entities must comply with the new AML Law:

1. Financial leasing activities
2. Payment services
3. Bank guarantees activities
4. Stockbrokers
5. Securities investment consulting, securities underwriting
6. Management of securities investment funds
7. Life insurance business
8. Casino business
9. Currency exchange activities
10. Accounting and legal services
11. Trading in precious metals
12. Foreign exchange services
13. Management of securities investment funds

KYC Information Requirements

Reporting entities must obtain the following information through the KYC reporting procedure:

1. Determine if the customer is a Vietnamese citizen.
2. Identify whether the customer is a foreigner with single citizenship.
3. Verify whether the customer is a foreigner with multiple citizenship.
4. Assess whether the customer falls into the category of a ‘stateless individual’.
5. Identify if the customer is an organization.

Money Laundering Risk Assessment Policy

The AML 2022 Law introduces new requirements for risk assessment, which the government will review every five years in cooperation with the State Bank of Vietnam. Reporting entities must also conduct their own AML assessment and disseminate any updates publicly to all departments, as well as to the State Bank of Vietnam and relevant ministries.

Client Information Verification

The new law broadens the definition of politically exposed persons (PEPs) to include foreign individuals with political influence and holding senior positions in organizations in Vietnam or abroad. Reporting entities are responsible for taking proper measures to verify the source of wealth of PEPs, as well as monitor their transactions.

Suspicious Transaction Reporting

Reporting entities must report suspicious transactions within one working day from the transaction date if using electronic reporting, or within two working days if using paper reporting. Suspicious transactions must be reported within three days from the transaction date or one day from the time of recognition.

Adapting to Changes in AML Law

Businesses in Vietnam should:

1. Train employees on anti-money laundering best practices.
2. Develop a risk assessment framework that is revised periodically to recognize and mitigate potential threats.
3. Have reliable anti-money laundering systems in place, such as software that provides key data intelligence.

Dezan Shira & Associates can assist foreign investors throughout Asia and maintains offices throughout ASEAN, including in Vietnam, Indonesia, Malaysia, the Philippines, and Thailand. Please contact us at asean@dezshira.com or visit our website at www.dezshira.com for more information.