Monthly Legal Overview (August 2023)

99 AVOCATS Summary of legal news in Monaco in August 2023:

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INTERNATIONAL • GAFI • MONEYVAL • COMPLIANCE • CRIMINAL

> Fight against money laundering, the financing of terrorism and the proliferation of weapons of mass destruction, and corruption

— Publication of Law no. 1.550 of 10 August 2023 (Part II)

In addition to Law no. 1.549 of 6 July 2023 (PART I), which mainly amends Law 1.362, the central mechanism for combating money laundering, the financing of terrorism and proliferation, and corruption, Law no. 1.550 of 10 August 2023 (PART II) (JDM no. 8655 of 11 August 2023) focuses on measures to ensure greater transparency of legal entities, as recommended by the MONEYVAL Committee Report of December 2022.

Law no. 1.550 (PART II) amends the laws governing the Trade and Industry Register (RCI), civil companies, foundations, associations and federations of associations:

• Enhanced access and control by the competent authorities to "basic information" on legal persons and their beneficial owners that is satisfactory, accurate and kept up to date: the new requirements applicable to companies are also applicable to associations and foundations (with new obligations for the latter, including in relation to bookkeeping, aimed at ensuring that they are not involved in the financing of terrorism);
  
• Power of supervision and administrative sanctions by the Economic Development Directorate (DDE) for companies and by the Department of the Interior for foundations and associations;
• Reinforcement of the dissuasive nature of administrative and criminal penalties.

Barring transitional exceptions, the provisions of Law no. 1.550 (like those of Law no. 1.549) will come into force on the date set by the regulations adopted for their application, but no later than 30 September 2023.

— Bill (PART III) tabled

In addition, Bill no. 1080 (PART III), tabled in Public Session on 31 July 2003, amends the Criminal Code, the Code of Criminal Procedure and Law 1. 222 of 28 December 1999 on extradition, in response to the recommendations of the MONEYVAL Committee Report to make criminal proceedings more effective and the criminal justice system a greater deterrent, and to clarify the scope of offences relating to money laundering, the financing of terrorism and proliferation of weapons of mass destruction and the circumvention of measures to freeze funds and economic resources.

— Publication of the first implementing order (Law no. 1.362)

Sovereign Order n° 10.076 of 31 July 2023, published on the same day, amends Sovereign Order no. 2.318 of 3 August 2009 setting the conditions for application of Law 1.362 concerning the Monegasque Financial Security Authority (AMSF) which succeeds SICCFIN :

• Members of the AMSF Board of Directors and incompatible functions ;
• Financial aspects, examination of the closing of AMSF's accounts;
• Contracts, memorandums of understanding and agreements entered into by AMSF.

> Freezing of funds and economic resources

Sovereign Order no. 10.077 of 31 July 2023 (JDM no. 8655 of 11 August 2023) amends Sovereign Order no. 8.664 of 26 May 2021 on procedures for freezing funds and economic resources in application of international economic sanctions, as amended, as follows:

• The Minister of State's decisions on freezing measures are published on the Government of Monaco's website dedicated to the freezing of funds and economic resources without delay, at the latest within twenty-four hours of their signature by the Minister of State;
• The standard of proof for deciding on a designation, on the Minister of State's own initiative (in matters of terrorism), is reasonable grounds for suspicion or belief that the criteria for designation have been met;
• The Advisory Committee now also includes the Director of Tax Services, or his representative, as well as the Public Prosecutor or the magistrate representing him, and that the Chairman of the Committee may invite any person who is not a member of the Committee to participate in its meetings and work without the right to vote;
• The enforcement of the provisions of Ordinance no. 8.664 with regard to professionals subject to Law no. 1.362, is carried out by the agents of the department exercising the supervisory function of the AMSF (under the conditions provided for by articles 54 to 56-2-1 of Law no. 1.362), and with regard to avocats-défenseurs and avocats, by the Conseil de l'Ordre (under the conditions provided for by articles 57 to 58-2 of Law no. 1.362). If, as a result of their investigations, the aforementioned officers or the Bar Council become aware of facts likely to constitute the offence provided for in article 12 (failure to comply with the provisions of Ordinance no. 8.664), they will refer the matter to the Public Prosecutor.
• The list of information that may facilitate the implementation of measures to freeze funds or economic resources adopted by the Minister of State for the application of restrictive measures adopted by the European Union with regard to actions that compromise or threaten the territorial integrity, sovereignty and independence of Ukraine, which credit institutions, other financial institutions, insurance companies and other bodies, entities or persons are obliged to communicate promptly to the Director of the Budget and Treasury.

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BANKING • FINANCE

Increase in the legal interest rate

Sovereign Order no. 9.988 of 21 July 2023 (JDM no. 8654 of 4 August 2023) repeals and replaces Sovereign Order n° 9.771 of 22 February 2023.

It sets the legal interest rate (used to calculate interest on sums payable in the event of late payment), in all matters, at 4% per annum (previously 2%) from 1 August 2023.

Usury: rate increase for personal loans and property loans for individuals

Sovereign Order no. 10.062 of 31 July 2023 (JDM no. 8655 of 11 August 2023) repealed and replaced Article 2 of Sovereign Order 2.271 of 6 July 2009 relating to the determination of the usury rate.

The "average rate charged under the same conditions by lenders acting in good faith" is set at :

— For individuals :

• Overdrafts: 14.88% (unchanged)
• Personal loans: 4.75% (previously 3.32%)
• Property loans: 4.01% (previously 3.44%)

— For businesses and sole traders:

• Overdrafts: 8.36% (unchanged)

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JUSTICE • PUBLIC

New period of secondment for French magistrates in Monaco

Sovereign Order no. 9.955 of 30 June 2023 (JDM no. 8657 of 25 August 2023) rendered enforceable the "Avenant" (Amendment), in the form of an exchange of letters dated 19 April 2023 and 4 May 2023, in force on 1st July 2023, amending article 5 of the Convention intended to adapt and deepen administrative cooperation between the French Republic and the Principality of Monaco signed in Paris on 8 November 2005.

The duration of the secondment of magistrates is now 5 years non-renewable (previously 3 years renewable for 3 years).

The period of secondment for magistrates seconded on 1 July 2003 for an initial period of 3 years is automatically extended to 5 years. The period of secondment for magistrates seconded for a second period of 3 years on 1 July 2023 remains 3 years.

Appointment of the Attorney General

Mr Stéphane THIBAULT (Advocate General at the Paris Court of Appeal) has been appointed Public Prosecutor with effect from 1st September 2023, by Sovereign Order n° 10.082 of 10 August 2023 (JDM no. 8656 of 18 August 2023).

Appointment of the First President of the Court of Appeal

Mr Francis JULLEMIER-MILLASSEAU (President of the Judicial Court of Aix-en-Provence) has been appointed First President of the Court of Appeal with effect from 1st September 2023 by Sovereign Order no. 10.083 of 10 August 2023 (JDM no. 8656 of 18 August 2023).

Appointment of three judges to the Court of First Instance

Mr Thierry DESCHANELS (First Vice-President of the Court of Bourg-en-Bresse), Mr Patrice FEY (Vice-President of the Court of Thonon-les-Bains) and Ms Anne-Sophie HOUBART (Vice-President of the Court of Toulon) were appointed Judges of the Court of First Instance with effect from 1 September 2023 by Sovereign Orders no. 10.084, no. 10.085 and no. 10.086 of 10 August 2023 (JDM no. 8656 of 18 August 2023).

New provisions for appointing members of the Supreme Court

Sovereign Order no. 9.994 of 21 July 2023 (JDM no. 8654 of 4th August 2023) amended as from 8 August 2023 the 2nd paragraph of article 1 of Sovereign Order no. 2.984 of 16th April 1963 on the organisation and functioning of the Supreme Court.

The members of the Supreme Court will be appointed for a term of office of 8 years, according to the following two series:

• 1st series: the alternate member proposed by the National Council, the member proposed by the Court of Appeal and members proposed by the Council of State (previously: full or alternate members proposed by the Crown Council, the National Council and the Court of First Instance);
• 2nd series (4 years later): the member proposed by the Crown Council, the full member proposed by the National Council and the member proposed by the Court of First Instance (previously: full or alternate members proposed by the Court of Appeal and the Council of State).

The 8-year term of office is not renewable, except in the case of full or alternate members appointed following resignation, impediment, death or dismissal for a term of less than 2 years.

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PROTECTION OF PERSONAL DATA

CCIN: Appointment of a Delegate in charge of monitoring law enforcement and litigation activities

Ms Aline GRINDA (First Judge at the Court of First Instance), on secondment from the Judicial Services Department, is appointed as the Delegate responsible for monitoring law enforcement and litigation activities at the "Commission de Contrôle des Informations Nominatives" (supervisory authority), with effect from 1st September 2023.

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REGULATED PROFESSION • PUBLIC

Practising medicine on a self-employed basis, in association

Sovereign Order n° 10.064 of 31 July 2023 (JDM n° 8655 of 11 August 2023) amended article 1 of Sovereign Order n° 5.766 of 21 March 2016 relating to the terms and conditions of association between doctors.

The maximum number of doctors with whom a doctor authorised by ministerial decree to practise on a self-employed basis may associate has been increased (from two) to four doctors.

However, the number of associated doctors simultaneously performing medical acts at the joint place of practice may not exceed two.

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