Annex II | Lower risk factors

The following is a non-exhaustive list of factors and types of evidence of potentially lower risk referred to in Article 20:

Customer risk factors:
1. public companies listed on a stock exchange and subject to disclosure requirements (either by stock exchange rules or through law or enforceable means), which impose requirements to ensure adequate transparency of beneficial ownership;
2. public administrations or enterprises;
3. customers that are resident in geographical areas of lower risk as set out in point (3);
Product, service, transaction or delivery channel risk factors:
1. life insurance policies for which the premium is low;
2. insurance policies for pension schemes if there is no early surrender option and the policy cannot be used as collateral;
3. a pension, superannuation or similar scheme that provides retirement benefits to employees, where contributions are made by way of deduction from wages, and the scheme rules do not permit the assignment of a member’s interest under the scheme;
4. financial products or services that provide appropriately defined and limited services to certain types of customers, so as to increase access for financial inclusion purposes;
5. products where the risks of money launderingmeans the conduct set out in Article 3, paragraphs 1 and 5, of Directive (EU) 2018/1673 including aiding and abetting, inciting and attempting to commit that conduct, whether the activities which generated the property to be laundered were carried out on the territory of a Member State or on that of a third country; knowledge, intent or purpose required as an element of that conduct may be inferred from objective factual circumstances; and terrorist financingmeans the conduct set out in Article 11 of Directive (EU) 2017/541 including aiding and abetting, inciting and attempting to commit that conduct, whether carried out on the territory of a Member State or on that of a third country; knowledge, intent or purpose required as an element of that conduct may be inferred from objective factual circumstances; are managed by other factors such as purse limits or transparency of ownership (e.g. certain types of electronic moneymeans electronic money as defined in Article 2, point (2), of Directive 2009/110/EC of the European Parliament and of the Council(38) Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, 10.10.2009, p. 7)., but excluding monetary value as referred to in Article 1(4) and (5) of that Directive;Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, 10.10.2009, p. 7).);
Geographical risk factors — registration, establishmentmeans the actual pursuit by an obliged entity of an economic activity covered by Article 3 in a Member State or third country other than the country where its head office is located for an indefinite period and through a stable infrastructure, including:a branch or subsidiary;in the case of credit institutions and financial institutions, an infrastructure qualifying as an establishment under prudential regulation;, residence in:
1. Member States;
2. third countriesmeans any jurisdiction, independent state or autonomous territory that is not part of the Union and that has its own AML/CFT legislation or enforcement regime; having effective AML/CFT systems;
3. third countriesmeans any jurisdiction, independent state or autonomous territory that is not part of the Union and that has its own AML/CFT legislation or enforcement regime; identified by credible sources as having a low level of corruption or other criminal activitymeans criminal activity as defined in Article 2, point (1), of Directive (EU) 2018/1673, as well as fraud affecting the Union’s financial interests as defined in Article 3(2) of Directive (EU) 2017/1371, passive and active corruption as defined in Article 4 (2) and misappropriation as defined in Article 4(3), second subparagraph, of that Directive;;
4. third countriesmeans any jurisdiction, independent state or autonomous territory that is not part of the Union and that has its own AML/CFT legislation or enforcement regime; which, on the basis of credible sources such as mutual evaluations, detailed assessment reports or published follow-up reports, have requirements to combat money launderingmeans the conduct set out in Article 3, paragraphs 1 and 5, of Directive (EU) 2018/1673 including aiding and abetting, inciting and attempting to commit that conduct, whether the activities which generated the property to be laundered were carried out on the territory of a Member State or on that of a third country; knowledge, intent or purpose required as an element of that conduct may be inferred from objective factual circumstances; and terrorist financingmeans the conduct set out in Article 11 of Directive (EU) 2017/541 including aiding and abetting, inciting and attempting to commit that conduct, whether carried out on the territory of a Member State or on that of a third country; knowledge, intent or purpose required as an element of that conduct may be inferred from objective factual circumstances; consistent with the revised FATF Recommendations and effectively implement those requirements.