Vietnam: Elements of classification of clients according to the risky extent

12:05, 10/10/2013

Recently, the Government of Vietnam issued Decree No. 116/2013/ND-CP detailing implementation of a number of articles of the Law on Prevention of Money Laundering.

Phân loại khách hàng trên cơ sở rủi ro rửa tiền, Nghị định 116/2013/NĐ-CP

According to Article 6 of Decree No. 116/2013/ND-CP of Vietnam’s Government, the reporting entities must elaborate regulation on classification of clients on the basis of the money laundering risk based on the following elements:

1. Client type: Residents or non-residents; organizations or individuals; clients in or out black list, warning list; fields and methods of operation and trading.

2. Type of products or services which clients use including those anticipated using: Cash or remittance services; payment service or service of money transfer or exchange; brokerage, entrustment or authorization services; life-insurance or non-life insurance services.

3. Geographical positions where clients reside or locate their head offices: Countries in embargo list stated in Resolutions of United Nations Security Council; countries in list of publicizing non-compliance, or insufficient compliance with recommendations about preventing money laundering and preventing donation for terrorism which is announced periodically by the Financial Action Task Force; countries, or regions, territories which are defined to have many activities involving heroin, corruption and money laundering.

4. Other elements which the reporting entities may self-define and classify in conformity with the arising reality.

View more details at Decree No. 116/2013/ND-CP of Vietnam’s Government, effective from October 10, 2013.

Ty Na

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