The European Commission has updated its list of high-risk third-country jurisdictions for anti-money laundering and counter-terrorist financing through a Delegated Regulation, with five African countries added and three retained on the EU’s updated register requiring enhanced due diligence by regulated financial institutions.
The updated Delegated Regulation does not impose sanctions or restrict trade or investment. Instead, banks and other entities covered by the EU’s anti-money laundering (AML) rules must apply enhanced due diligence when dealing with customers or transactions linked to listed jurisdictions. For businesses, the practical impact may include additional documentation requirements, closer scrutiny of transactions and longer processing times when working with European financial institutions.
Under the EU’s Anti-Money Laundering Directive, the European Commission identifies third countries with what it describes as ‘strategic deficiencies’ in their anti-money laundering and counter-terrorist financing (AML/CFT) systems that could pose significant risks to the integrity of the Union’s financial system.
The latest amendment to Commission Delegated Regulation (EU) 2016/1675 added Algeria, Angola, Cote d’Ivoire, Kenya and Namibia to the list. They join Cameroon, the Democratic Republic of the Congo and South Sudan, which were retained following the latest review, bringing the number of African jurisdictions currently included on the EU list to eight.
The Commission said its assessment takes account of information from multiple sources, including evaluations by the Financial Action Task Force (FATF), while applying the EU’s own legal methodology to determine whether identified strategic deficiencies warrant inclusion on the list.
Enhanced due diligence rather than penalties
For businesses and financial institutions, the listing has practical compliance implications rather than punitive consequences.
EU banks, insurers, investment firms, accountants and other regulated entities must apply enhanced customer due diligence and ongoing monitoring when dealing with customers or transactions linked to the listed jurisdictions. This may involve obtaining additional information on customers and beneficial owners, verifying the source of funds, requesting further supporting documentation and increasing transaction monitoring before processing payments.
The Commission emphasises that inclusion on the list is intended to protect the EU financial system from money laundering and terrorist financing risks. It does not prohibit investment, trade or financial transactions with the affected countries.
Although the European Commission’s assessment takes account of the work of the FATF, the two lists are not identical.
The FATF identifies jurisdictions under increased monitoring at the global level, while the European Commission conducts its own independent legal and technical assessment before deciding whether to include countries on the EU’s list of high-risk third-country jurisdictions.
As a result, countries may appear on one list before being added to or removed from the other, depending on the Commission’s assessment and the EU legislative process. Africa Briefing previously reported that Nigeria and South Africa were nearing their exit from the FATF grey list, illustrating how jurisdictions can strengthen their AML/CFT frameworks over time. The latest EU update reflects a separate legal assessment conducted under EU legislation.
Countries removed from the latest update
Under the updated Delegated Regulation as published in the Official Journal of the European Union, Burkina Faso, Mali, Mozambique, Nigeria, South Africa and Tanzania have been removed from the EU’s list of high-risk third-country jurisdictions after the European Commission concluded that they had sufficiently strengthened their anti-money laundering and counter-terrorist financing frameworks.
The removals reflect the EU’s ongoing review process, under which jurisdictions can be delisted once they address previously identified strategic deficiencies. The move follows broader progress in Africa’s financial integrity framework, including the FATF’s decision to delist four African countries after determining they had made sufficient progress in strengthening their anti-money laundering systems.
For the affected countries, inclusion on the EU list may increase compliance costs for companies seeking financing or conducting cross-border transactions with European financial institutions.
Banks may require additional documentation before processing payments or opening accounts, while exporters, importers and investors could face more extensive due diligence checks. Correspondent banking relationships may also come under closer scrutiny as institutions strengthen their risk management procedures.
For Namibia in particular, the designation comes despite recent domestic enforcement efforts. Africa Briefing recently examined Namibia’s intensified anti-money laundering enforcement, highlighting the country’s efforts to strengthen its financial crime controls.
The EU’s latest review also comes as African institutions strengthen regional cooperation against illicit finance. Earlier this year, the African Development Bank and Interpol launched a continent-wide partnership to combat financial crime, targeting corruption, cyber fraud and money laundering.
However, the designation does not prevent European companies from investing in or trading with the listed countries.
The latest EU action also reflects growing international concern over organised criminal networks operating across Africa. As Africa Briefing recently reported in Organised crime deepens across Africa, financial crime remains one of the continent’s fastest-growing illicit markets, increasing pressure on governments to strengthen regulatory oversight and cross-border cooperation.
