(Moneyval) Law no. 1.550 of 10 August 2023 (Part II) Fight against money laundering, financing of terrorism and of the proliferation of weapons of mass destruction

Law no. 1.550 of 10 August 2023 adapting legislative provisions to combat money laundering, the financing of terrorism and proliferation of weapons of mass destruction (PART II) (published in JDM no. 8655 of 11 August 2023), is the result of bill no. 1078 submitted to the Parliament (Conseil National) on 30 May 2023 and passed on 31 July 2023.

Presentation

It follows on from the 5th Mutual Evaluation Report of the MONEYVAL Committee on the measures implemented in this area by the Principality of Monaco between 2015-2021, published on 23 January 2023. Find out more here

This is the second in a series of three (or even four if necessary) government laws to implement the recommendations of the evaluators:

Law No. 1,549 (PART I), previously published, focuses mainly on amending the general preventive framework (Law No. 1,362 of 3 August 2009), while the present Law No. 1.550 (PART II) focuses specifically on the transparency of legal entities (commercial companies, economic interest groupings, civil companies, foundations, associations and federations of associations).

In addition, Bill 1080, tabled in the Public Session of the Parliament on 31 July 2023, amends the criminal law framework (Code of Criminal Procedure, Criminal Code, extradition législation).

The Principality is under "enhanced scrutiny". Its situation will be re-examined by the FATF in June 2024 and then by the Council of Europe in December 2024. This means that the MONEYVAL recommendations must be implemented within one year.

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SUMMARY

Law No. 1.550 (PART II) (structured in six chapters including transitional provisions) focuses on measures to ensure greater transparency of legal persons:

→ Reinforced and extended access by the competent Monegasque authorities to satisfactory, accurate and up-to-date "basic information" on the beneficial owners and control of legal persons:

Companies and GIE ("Economic interest groupings")

• Amendment of the legal regime of the Special Register of Civil Companies and the Trade and Industry Register (RCI) in order to include all the "basic information" relating to companies and GIE;
• Mechanism for obtaining, keeping, updating and making available this information to be implemented not only by the legal entities concerned, but also by the public authorities responsible for overseeing them;
• Obligation on companies and GIE to appoint a person responsible for basic information and information on beneficial owners, who will be the main contact for the competent authorities (introduced by the Law no. 1549 "Part I" amending Law no. 1.362 of 3 August 2009);
• Access to said information open to the public (partially) and to the competent authorities involved in the fight against money laundering (as a whole) including the future Monegasque Financial Security Authority (replacing SICCFIN), the judicial authorities, judicial police officers acting on requisition or delegation, the Director of Public Security, authorised agents of the Tax Department, the seized and confiscated assets management department of the Judicial Services Department, the Financial Activities Control Commission (CCAF).

Associations et foundations

• The requirements set out above for companies and economic interest groupings would also apply to them;
• New requirements for keeping accounts and setting up mechanisms to ensure that their partners, donors (donations received) and the final beneficiaries of their donations (donations paid out) are not involved in terrorist financing.

→ Establishment of a legal framework adapted to the new measures that may be taken to keep all "basic information" up to date:

• Power of supervision and administrative sanctions by the Economic Development Department (compulsory entries in the registers, graduated financial penalties depending on the failure to comply) and the Department of the Interior (administrative sanctions and, in the event of persistent failure to comply, referral to the President of the Court of First Instance with a view to dissolution of the association or foundation) as part of their general task of monitoring compliance by legal entities under their jurisdiction with the obligations imposed on them in terms of transparency;
• Reinforcement of the dissuasive nature of administrative and criminal penalties (revised wording, and increase in the quantum of penalties) applicable to legal entities, their directors or persons involved in their administration, in particular to ensure that complete and up-to-date registers are kept.

The following laws are amended as a result:

• Loi n° 721 du 27 décembre 1961 abrogeant et remplaçant la loi n° 598, du 2 juin 1955 instituant un répertoire du commerce et de l'industrie (Chap. I );
• Loi n° 797 du 18 février 1966 relative aux sociétés civiles (Chap. II);
• Loi n° 1.355 du 23 décembre 2008 sur les associations et les fédérations d’associations (Chap. III);
• Loi n° 56 du 29 janvier 1922 sur les fondations (Chap. IV).