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Gibraltar FIU – Counter Terrorist Financing Guidance

Terrorism remains a significant threat to international peace, security and economic stability across all regions of the globe. Combating the financing of terrorism has for many years been a central element of the international community’s response to this threat.

Terrorist financing (TF) activity is extremely hard to detect, not just because it may involve smaller sums of money than money laundering activity, but because it involves transactions that are often indistinguishable from legitimate day-to-day activities. Terrorist groups such as Al-Qaeda and their affiliates obtain funding from a wide and continually evolving range of sources. This funding is used to conduct terrorist acts and maintain and grow their terrorist organisations as a whole.

The Financial Action Task Force (FATF) of the United Nations Security Council has been at the forefront of setting international standards to counter terrorist financing (CTF), the purpose of which is to deprive terrorists of funds and their resources. Gibraltar’s legislative framework is designed to align with these standards.

Extreme right-wing terrorism (also referred to as ‘far right, or ethnically and racially motivated terrorism’) is not a new phenomenon but there has been a recent revival of right-wing extremist groups and an increase in frequency of attacks, with deadly results. This guidance includes a section on right-wing terrorism but further research will be needed to provide a more detailed analysis on relevant red flags and indicators.

Whilst the overall threat of TF in Gibraltar at a jurisdictional level remains low, the risk is higher for specific sectors of the economy or when dealing with certain jurisdictions. An effective CTF response requires that all stakeholders have a robust understanding of their obligations together with the TF risks faced in Gibraltar and, more specifically, the threats faced in their industry.

This guidance has been prepared by the Gibraltar Financial Intelligence Unit (GFIU). It aims to provide entities with guidance on their CTF obligations and sector specific guidance on the TF threats they face.

Chapter 1 provides a high level and non-jurisdiction-specific introduction to TF1;

Chapter 2 outlines the CTF obligations that are applicable in Gibraltar;

Chapter 3 sets out the jurisdictional risks of TF in Gibraltar;

Chapter 4 provides sector-specific guidance on the TF threats faced, including case studies and known risk indicators;

Chapter 5 describes the ways in which GFIU will provide local contextual information and provide feedback to reporting entities on their suspicious activity reports.

This guidance takes into account the 2020 National Risk Assessment for AML/CFT and PF conducted by the national coordinator for AML/CFT. It also draws on various FATF publications with their permission, which is gratefully acknowledged. The reader’s attention is drawn to these where appropriate for their further information.

Please note that neither GFIU nor the Gibraltar competent authorities can issue definitive guidance on how the law might be applied in a particular case or how the courts might interpret the law. Please also note that the relevant competent authorities in Gibraltar would consider each matter on the facts and the specific legal requirements that apply.

This guidance is not intended to be, and should not be relied on as legal advice. GFIU strongly advises you to refer to the relevant, up-to-date legislation. If you are unsure about your obligations, you are strongly encouraged to obtain independent legal advice. This guidance may be updated from time to time. Always check that you are referring to the latest version.

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Brexit

Gibraltar, together with the UK, left the European Union on the 31st January 2019 (‘Brexit’). The transition period agreed as part of the UK-EU Withdrawal Agreement, which applied to Gibraltar, ended on the 31st December 2020. Prior to this, Gibraltar’s legislative framework implemented EU law where it existed and gave direct effect to EU sanctions in Gibraltar. This remains the case and Gibraltar law continues to reflect the EU framework notwithstanding the expiry of the transition period. In addition, the Sanctions Act 2019 recognizes, as a matter of Gibraltar domestic law, new EU sanctions promulgated since 1st January 2021.

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For the full Guidance Paper (PDF) – Press Here.

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