EU removes Pakistan from High-Risk Third Countries list

By
Eman Mudassar Tarar
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72
EU
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Islamabad, 29 March 2023 (TDI): The European Union (EU) has removed Pakistan from its list of “High-Risk Third Countries” in terms of anti-money laundering and counter-terrorism financing frameworks.

The announcement was made by the Ministry of Commerce, Syed Naveed Qamar on Wednesday. He indicated that Pakistan’s exclusion from the list would ease the cost and time of legal and financial transactions by Pakistani entities and individuals in the EU.

Moreover, the move was praised by Pakistani officials, who said that it would add to the comfort level of European economic operators.

To mention, the list included countries that the EU considered to have strategic deficiencies in their anti-money laundering and counter-terrorism financing frameworks.

The removal of Pakistan from the list means that EU member states “Obligated Entities” will no longer be required to apply “Enhanced Customer Due Diligence” while conducting transactions with individuals and legal entities established in Pakistan.

The entities include credit institutions, financial institutions, auditors, external accountants, tax advisors, notaries, independent legal professionals, estate agents, and individuals trading in goods.

In the same vein, Federal Minister for Climate Change, Sherry Rehman, credited Foreign Minister Bilawal Bhutto Zardari for the “achievement” of Pakistan’s removal from the EU’s list.

For the information, the placement of countries on the EU list is meant to identify jurisdictions that have strategic deficiencies in their national AML/CFT regimes.

This in turn poses significant threats to the financial system of the EU and hence the proper functioning of the internal market.

When a country is added to the list, it means that the EU believes that there are significant weaknesses in that country’s legal and regulatory systems for preventing financial crime and terrorist financing.

The removal of Pakistan from the list is a significant achievement for the country, indicating its efforts to improve money laundering and terror financing curbs.

Likewise, the move is likely to boost Pakistan’s economy and facilitate legal and financial transactions between Pakistani entities and individuals in the EU.

Notably, the news comes after the United Kingdom (UK) also removed Pakistan from its “high-risk third countries” list in November last year through a statutory instrument.

Also, it acknowledged Pakistan’s efforts to improve its anti-money laundering and counter-terrorism financing frameworks.

In a nutshell, the removal of Pakistan from both lists is a testament to the country’s commitment to strengthening its financial systems and combating financial crimes.

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