(Mar. 4, 2009) On February 10, 2009, the Milli Majlis (legislature) of Azerbaijan passed the Law on Countering Money Laundering and Terrorism Financing. The Law was drafted under the supervision of the Council of Europe, whose recommendations were included in the text of the Law.
According to the Law, a special government agency tasked with the duties of financial monitoring will be created. The Financial Monitoring Agency will develop a legal mechanism for detecting and preventing money laundering and terrorism financing. The Law requires that the Agency conduct surveillance of all domestic financial operations for amounts higher than the equivalent of US$18,000 and of all money transfers to and from abroad. The Law does not entrust the Agency with investigative functions; it states that the results of financial monitoring will be forwarded to the Office of the Prosecutor General for criminal investigation. Subjects of surveillance will be banks and other credit institutions, insurance companies, professional participants in the securities market, providers of leasing services, pawnshops, investment funds, operations involving precious stones and metals, money transfers through postal offices, real estate operations, organizers of lotteries, and nongovernmental and religious organizations.
The original version of the Law was drafted in 2005, but its adoption was delayed because it did not meet the requirements of the Financial Action Task Force (FATF, the intergovernmental anti-money-laundering body). Although this time the Law was evaluated positively by the FATF, the Expert Group on Money Laundering and Terrorism Financing of the Council of Europe, known as “Moneyval,” called for increased vigilance in dealings with Azerbaijan. (Law on Money Laundering Passed in Azerbaijan [in Russian], MPA ECONOMIC NEWS, Emerging Markets Information Service online subscription database, http://site.securities.com (last visited Feb. 25, 2009).)