EU Amendments To List Of High-Risk AML/CTF Countries

Key Takeaways:

1. The Russian Federation, Bolivia and the British Virgin Islands ("BVI") have been added to the EU list of third countries deemed high risk for AML/CTF purposes.
2. The EU has removed Burkina Faso, Mali, Mozambique, Nigeria, South Africa, and Tanzania from this list.
3. The EU's position redefines the risk landscape for entities with exposure to Russian, Bolivian, and BVI organisations or inpiduals, and consequently increases commercial pressure on EU/Russian relationships with extensive global sanctions already imposed due to the ongoing Russia/Ukraine conflict.

Overview of Amendments:

The European Commission maintains a list of third countries that are deemed to present a significant risk to the stability of the EU financial system due to weak financial controls and governance frameworks for anti-money laundering ("AML") and counter-terrorism financing ("CTF"). EU member states must impose requirements for enhanced due diligence ("EDD"), strict monitoring measures, and mandatory reporting of suspected offences by regulated entities, including financial institutions ("obliged entities") within these jurisdictions.

In early December 2025, the Commission adopted two regulations amending its list of third countries, adding Bolivia, the British Virgin Islands, and the Russian Federation to the list, whilst removing Burkina Faso, Mali, Mozambique, Nigeria, South Africa, and Tanzania. The regulations entered into force on 29 January 2026. The updated EU list of countries with deficient AML and CTF regimes is available here.

Possible Impacts to Organisations:

Increased Russian risk and compliance obligations in the EU: Through this amendment, EU has codified a robust risk framework that obliged entities must apply to all business relationships or transactions involving Russia, intended to restrict Russian access to the EU market. Russian relationships remain subject to comprehensive state sanctions and now also require specific EDD, enhanced transaction monitoring, and the imposition of certain conditions on account formation to achieve EU compliance. Companies classified as "obliged entities" subject to AML-requirements, including financial institutions, must update relevant AML/CTF policies to include Russian entities, inpiduals and transactions with Russian connections. The new measures are likely to further dissuade obliged entities from maintaining relationships or processing transactions involving Russian inpiduals and entities, and businesses still engaged with Russian counterparts should be prepared for even more scrutiny from their banking partners. The need for more time-consuming and complex measures to enter and/or uphold commercial relationships with Russian entities, on top of pre-existing sanctions, may lead business to reassess the viability of these relationships.

EU pergence from FATF global AML list: Following Brexit, the United Kingdom adopted and maintains its own list of High-Risk Countries under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017. This list mimics the Financial Action Task Force ("FATF") listings. FATF suspended Russian membership in February 2023 on the invasion of Ukraine, but at the time of writing, neither the UK nor FATF have updated their respective list of high-risk countries to include Russia. Russia is currently not classified as high risk by FATF and the UK for firms not regulated in the EU.

This pergence between the EU and UK/FATF lists will impact multinational firms, who must reassess their risk approach to Russia-related relationships. Organisations may choose to apply the enhanced requirements for EU-level compliance across their global operation or adopt a jurisdiction-specific approach with EDD in place for EU operations only.

Potential impacts on U.S. entities: apart from its legal impacts on EU obliged entities, many U.S. financial institutions rely on the EU list of third countries in determining geographic risks for their own AML programs.

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