ISLAMABAD: The European Union has removed Pakistan from its List of High Risk Third Countries. This was announced by Federal Minister for Trade Syed Naveed Qamar in a Twitter post the other day.
The move, originally happened on March 15, 2023, is expected to have significant implications for businesses and individuals in Pakistan, as well as for EU member states.
In his Twitter post, Naveed Qamar said “EU has removed Pakistan from the List of High Risk Third Countries. Pakistani businesses and individuals would no longer be subjected to ‘Enhanced Customer Due Diligence’ by European legal and economic operators.”
Sir
EU has removed Pakistan from the List of High Risk Third Countries. Pakistani businesses and individuals would no longer be subjected to ‘Enhanced Customer Due Diligence’ by European legal and economic operators.— Syed Naveed Qamar (@naveedqamarmna) March 28, 2023
Officials at Embassy of Pakistan, Brussels, Belgium have also confirmed that European Commission has removed Pakistan from the List of High Risk Third Countries having strategic deficiencies in their AML/CFT regime.
Background
Pakistan was initially placed on the List of High Risk Third Countries in October 2018 due to perceived strategic deficiencies in its anti-money laundering/counter-terrorism financing (AML/CFT) regime.
This designation created undue regulatory burdens on obligated entities in the EU and led to instances where some businesses refused to engage in legal and financial transactions with entities based in Pakistan.
EU’s Decision
According to the EU’s Delegated Regulation, Pakistan, along with Nicaragua and Zimbabwe, have remedied the strategic deficiencies in their respective AML/CFT regimes and no longer pose a significant AML/CFT threat to the international financial system.
The EU’s decision means that obligated entities in member states will no longer be required to apply Enhanced Customer Due Diligence when dealing with individuals and legal entities established in Pakistan.
