Pakistan out of EU’s high-risk third countries list

Pakistan has been taken off the list of “High-Risk Third Countries” by the European Union (EU). Following Pakistan’s removal from the list the legal and business operators of the regional body will no longer subject Pakistani companies and individuals to “Enhanced Customer Due Diligence.”

According to a statement from the Ministry of Commerce, Pakistan had been removed from the list of countries with strategic shortcomings in the Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) regime that seriously endangered their financial system.

According to the delegated regulation, “Following the measures implemented to address the action plans agreed with the Financial Action Task Force (FATF), Nicaragua, Pakistan, 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.

Taking into account their relevance under the revised methodology, the Commission considers that these jurisdictions no longer have strategic deficiencies in their respective AML/CFT frameworks and do not pose a significant threat to the financial system of the European Union.”

According to the aforementioned legislation, “Obligated Entities” in EU member states are no longer required to do enhanced customer due diligence when dealing with people and organizations based in Pakistan.

Earlier, On October 22, 2018, European Union included Pakistan in its List of High-Risk Countries.

Due to the inclusion of Pakistan on the list, “Obligated Entities” in the EU were subjected to an excessive regulatory burden, and in some cases, they refused to engage in business dealings with people and organizations based in Pakistan.

According to the ministry, the new development would increase the degree of confidence among European businesspeople and is anticipated to reduce the expense and duration of legal and financial operations by local Pakistani organizations and people.

In November 2022, the UK got Pakistan off of its list of high-risk countries.