INFORMAL TRANSLATION. Ministerial Order No. 9 of 2005

Transcription

1 INFORMAL TRANSLATION Kuwait al Youm, Issue 727, 51 st year Sunday 25 th Jamada Al Akhera 1426 H - 31/7/2005 A.D. Ministry of Finance Ministerial Order No. 9 of 2005 Regarding the procedures and controls of the execution of provisions of law no. 35 of 2002 regarding fighting money laundering transactions Minister of Finance: - Having reviewed law no. 35 of 2002 regarding the fighting of money laundering transactions, - The Minister of Finance s order no. 10 of 2003 regarding the obligation of the country visitors to declare whatever national or foreign currencies, gold bullions or other precious goods or things in their possession, - The Minister of Finance s order no. 11 of 2003 regarding the foundation of Kuwait Financial Investigation Unit and the decision of the governor of Central Bank of Kuwait no. 1/191/2003 as amended with decision no. 1/334/2003 in this regard, - The Minister of Finance s order no. 11 of 2004 regarding the fighting of money laundering transactions and terrorism finance, and - The international agreements related to fighting money laundering transactions and terrorism finance Article (1) Ordered In the application of the provisions of this order and the executive orders made in execution of the law no. 35 of 2002 regarding the fighting of money laundering transactions, the following terms shall mean the meanings stated next to each term:

2 1. Law: Means law no. 35 of 2002 related to fighting money laundering transactions. 2. Money laundering transactions: Means one or some financial or non-financial transactions intended to hide or cover the illegal source of funds, the proceeds of any crime and purporting to exhibit them as resulting from the funds or proceeds of a legal source. Such transactions include each action that contributes to the placement or transfer of funds or proceeds resulting directly or indirectly from a crime or hiding or covering the nature, source or owner thereof, changing the reality thereof or preventing the disclosure thereof or the identification of the doer of the crime resulting in such funds or proceeds. 3. Financial institutions: Any licensed institution carrying out one or more businesses in the field of financial transactions in accordance with the relevant regulating laws or customs, whether publicly, privately, or jointly owned. 4. Relevant authorities: These are the public authorities or any government authority commissioned by the law or the relevant executive ministerial orders to play a role in fighting money-laundering transactions. 5. Mediums: Each thing used or prepared for use in any manner in committing one of the crimes stated in the law. 6. Funds and properties: These are the assets whether material or immaterial, fixed or current as well as instruments or bonds evidencing such assets or any pertaining right. 7. Proceeds and returns: Any funds derived or obtained directly or indirectly from committing one of the crimes stipulated in the law such as trading in, planting, exporting or importing narcotics, trading in weapons and ammunitions, transgression on public funds and other crimes.

3 8. Transaction: Means each disposal of funds, including for example the purchase, sale, mortgage, donation, transfer, delivery, deposit, withdraw, currency exchange, borrowing, purchase or sale of any stocks or bonds. Article (2) The authorities addressed with the provisions of article three of the law mean the following: First: Financial institutions and companies: a. National banks and branches of foreign banks licensed to operate in the country. b. Exchange companies that mean any company licensed to carry out exchange business such as sale and purchase of currencies, traveler s cheques, transfers, trade in precious metals and stones, collection of cheques and transfers drawn overseas c. Individual exchange firms d. Investment companies e. Insurance companies, agents or brokers f. Investment funds of different types g. Financial brokerage companies and firms that carry out brokerage business between its clients and other bodies exercising business related to the sale and purchase of foreign currencies, securities, precious metals and stones, etc. h. Financial brokerage companies and firms carrying out brokerage of securities in Kuwait Stock Exchange Market.

4 i. Companies and firms holding or collecting third parties funds. j. Companies managing third parties properties. Second: Non-financial companies and firms and individuals: a. Individual firms and companies operating in the field of trade of jewelries, precious stones and metals as well as all other precious movables. b. Auditors c. Real estate agents d. Lawyers Third: Individuals and other bodies as specified under the order of the Minister of Finance. Article (3) The authorities stated in the second article hereof shall observe the following: a. Not keep accounts, open accounts, perform any transactions of whatever type, rent safes, keep bonds, financial or commercial bills, notes, precious jewels or metals or any other expensive things in anonymous, code or fake names. b. Not open any account or perform any transaction amounting more than Kuwaiti Dinars three thousands or the equivalent thereof in foreign currencies except after verifying the client identity and capacity and the real beneficiary. The client identity and personality shall be verified as follows: 1. Civil ID Card for nationals and expatriates, provided that the card is valid. 2. Passport or travel document for non-residents. 3. Commercial license issued by Ministry of Commerce and Industry for firms and companies.

5 4. Papers, documents, instruments and court judgments evidencing the authorization of representatives of companies, firms or individuals. 5. Official documents for other local authorities and the documents issued or certified by the respective authorities in the country of the non-resident firms, corporations and companies. c. Record and register all financial and non-financial transactions in their official records in accordance with regular accounting system and maintain such records and all relevant documents and instruments of such transactions whether local or foreign including copies of the papers referred to in item b for at least five years from the date of transaction. d. To train the respective staff and officers on regular basis about the new developments in the field of fighting money laundering transactions and identification thereof and keep them informed of the requirements of the law and its ministerial executive orders. e. To establish and consolidate internal control regulations of financial companies and institutions to have the ability to find out suspected transactions immediately upon occurrence thereof and report them to ensure compliance with the local requirements in the filed of fighting money laundering transactions. f. To observe the ministerial orders and instructions related to fighting of money laundering transactions. Article (4) Failure of the firms, companies and individuals referred to in article two to comply with any of the obligations stated in the third article hereof shall be a violation of the provisions of law and shall entail the imposition of penalties stipulated in article eleven hereof, without prejudice to any more severe penalty under the law. Article (5) General Administration of Customs shall take necessary procedures to track any funds, financial or commercial bills, jewels and precious stones and precious metals or any other precious things upon entry thereof into the

6 country in any manner through land, air or seaports and fill in the basic data to verify the lack of any violation of the law provisions. Article (6) In execution of the provisions of article four of the law, each person arriving at the country through the ports of the State of Kuwait must notify the customs authorities of his possession of national or foreign currencies or golden bullions or other precious things amounting more than Kuwaiti Dinars three thousand or the equivalent thereof in foreign currency. The General Administration of Customs shall prepare the customs clearance form in coordination with the respective bodies, subject to containing the following: 1. Name and personal particulars of traveler 2. Other particulars of passport 3. Details of his usual place of residence 4. Reason for arrival and the original point of departure and provisional place of residence in the country 5. Statement of amount and description of currencies, gold bullions or other precious things in his possession exceeding three thousand Kuwaiti Dinars or the equivalent thereof in foreign currency and shall report the same. 6. Any other data which the General Administration of Customs decides to add. The General Administration of Customs shall be competent to receive the customs clearance form and shall take necessary action in coordination with the respective authorities. These data shall be recorded in special registers. Article (7) The staffs of General Administration of Customs who have the judicial arrest power in application of the provisions of law no. 10 of 2003 regarding the issuance of uniform customs law regulations of GCC countries, in case of violation of article six hereof, shall prepare a record of the arrest procedures and register the seized things after recording the full description thereof in the record and forward the accused and the seized things to the public prosecution. Article (8)

7 The governor of Central Bank of Kuwait shall be competent to found Kuwait Financial Investigation Unit and nominate its head and members and approve its organizational and administrative structure. Article (9) Kuwait Financial Investigation Unit shall be assigned with the following: 1- To receive reports of money laundering transactions from the public prosecution and collect the relevant information and data of the said reports in accordance with the referral decision by the public prosecution. 2- To analyze the information and data related to the reports referred to in the preceding item and provide the public prosecution with technical opinion on such reports. 3- To found the database and statistics relevant to the reports received by the unit. 4- To contribute to the training and awareness programs of fighting money laundering transactions in coordination with the national committee of fighting money laundering transactions and terrorism finance and relevant bodies. 5- To coordinate with the public prosecution regarding the exchange of information and data on national and international levels. Article (10) The funds irrevocably judged to be confiscated shall pass to the Ministry of Finance and shall be included in the state revenues and shall be disposed of in accordance with the stipulated rules of the public budget. Article (11) The financial remuneration stated in the fifteenth article of the law shall be released by a decision by the Minister of Finance for each case separately. Its assessment shall be based on the circumstances of the fact and the efforts exerted in identifying it, provided that the remuneration amount shall not exceed twenty thousand Kuwaiti Dinars per each case. In all cases, remuneration shall be paid only after the delivery of final judgment of conviction of the respective crime. Article (12)

8 This order shall be published in the official gazette and come into effect on the date of its publishing. All previous contradicting orders shall be revoked. Minister of finance Bader Mishary Al Homaidi Made on 4 Jamada Al Akhera 1426 A.H. Corresponding 10 th July 2005 A.D.