Curacao

Sanctions

No

FATF AML Deficient List

No

Higher Risk

US Dept of State Money Laundering assessment 
Offshore Finance Centre

Medium Risk

Compliance with FATF 40 + 9 Recommendations
Weakness in Government Legislation to combat Money Laundering

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ANTI-MONEY LAUNDERING

 

FATF Status

Curacao is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

 

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Curacao was undertaken by the Financial Action Task Force (FATF) in 2012. According to that Evaluation, Curacao was deemed Compliant for 8 and Largely Compliant for 17 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for 4 of the 6 Core Recommendations.

 

US Department of State Money Laundering assessment (INCSR)

Curacao is categorised by the US State Department as a Country/Jurisdiction of Primary Concern in respect of Money Laundering and Financial Crimes.

OVERVIEW

 

Curacao’s prominent position as a regional financial center is declining, but it is still considered a transshipment point for drugs and gold from South America.  Money laundering occurs through the sale of illegal narcotics, unlicensed money lenders, online gaming, and the transfer of gold from South America.  

 

Curacao is an autonomous entity within the Kingdom of the Netherlands (Kingdom). The Kingdom retains responsibility for foreign policy and defense, including entering into international conventions, with the approval of the local Parliament.  In 2016, Aruba, Sint Maarten, the Netherlands, and Curacao signed an MOU with the United States for joint training activities and sharing of information in the area of criminal investigation and law enforcement. One priority area is interdicting money laundering operations. The MOU activities are ongoing.

 

 

Other Reports

Extract from IMF Report - Kingdom of the Netherlands—Curaçao and Sint Maarten - 2018 Article IV Consultation Discussions (January 2019)

Progress is also being made on strengthening the AML/CFT framework, especially on the regulatory front, but implementation needs to be accelerated. Staff discussed the actions being taken on the implementation of the 2012 Financial Action Task Force (FATF) standard, including the National Risk Assessment (NRA), and on the measures taken to ensure the effectiveness of enhanced due diligence for politically exposed persons (PEPs). The CBCS has provided guidance on detection and deterrence of money laundering/terrorist financing, including PEPs in the customer-risk categories. Strengthening the asset declaration regime, in particular to broaden its scope (currently only applies to (candidate) ministers in Curaçao), would assist anti-corruption bodies’ efforts to detect illicit enrichment and financial institutions’ implementation of AML preventive measures on PEPs. 

The authorities agreed with the need to strengthen the central bank governance and stressed their intention to complete the permanent CBCS Executive Board in a short period of time. Strengthening transparency is also one of the key objectives in the newly adopted CBCS Strategic Plan. The CBCS noted the progress being made on the NRA for Curaçao (to comply with the 2012 FATF Recommendation 1), with the help of the World Bank tool, which is expected to be completed by June 2019. The authorities are also revising regulations to strengthen the CBCS’s AML/CFT framework on enforcement actions and enhancing the sector’s awareness of AML/CFT compliance, including through training. To promote good governance, the authorities in Curaçao and Sint Maarten are working on establishing/operationalizing integrity chambers.

There is an urgent need to further reinforce financial sector oversight and monitor the risks from the withdrawal of CBRs. The authorities’ emphasis on strengthening the enforcement, addressing regulatory gaps, and collaborating internationally to alleviate CBR pressures are steps in the right direction. Macroprudential databases should be completed and macroprudential policy framework utilized to bolster financial sector resilience. The efforts to comply with the international standards on AML/CFT, transparency and exchange of information for tax purposes (Curaçao) and the OECD Common Reporting Standards (Sint Maarten) should continue. The authorities’ cautious approach to financial innovations is warranted, helping balance the tradeoffs between potential efficiency gains and risks to stability and integrity.

Efforts to improve governance should intensify, including by strengthening anti-corruption institutions, promptly taking steps to operationalize the Integrity Chamber for Sint Maarten and establishing one for Curaçao, completing the CBCS Executive Board, successfully carrying out the NRA, and effectively implementing the AML/CFT framework to comply with the 2012 FATF Recommendations.

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SANCTIONS

There are no international sanctions currently in force against this country.

 

 

BRIBERY & CORRUPTION

Rating                                                                           (100-Good / 0-Bad)

Transparency International Corruption Index                           77

World Governance Indicator – Control of Corruption             N/A

 

ECONOMY

Most of Curacao’s GDP results from services. Tourism, petroleum refining and bunkering, offshore finance, and transportation and communications are the mainstays of this small island economy, which is closely tied to the outside world. Curacao has limited natural resources, poor soil, and inadequate water supplies, and budgetary problems complicate reform of the health and education systems. Although GDP grew only slightly during the past decade, Curacao enjoys a high per capita income and a well-developed infrastructure compared with other countries in the region.

Curacao has an excellent natural harbor that can accommodate large oil tankers, and the port of Willemstad hosts a free trade zone and a dry dock. Venezuelan state oil company PdVSA, under a contract in effect until 2019, leases the single refinery on the island from the government, directly employing some 1,000 people; most of the oil for the refinery is imported from Venezuela; most of the refined products are exported to the US and Asia. Almost all consumer and capital goods are imported, with the US, the Netherlands and Venezuela being the major suppliers.

The government is attempting to diversify its industry and trade and has signed an Association Agreement with the EU to expand business there. In 2013, the government implemented changes to the sales tax and reformed the public pension and health care systems, including increasing the sales tax from 5% to as high as 9% on some products, raising the age for public pension withdrawals to 65, and requiring citizens to pay higher premiums.

Agriculture - products:

aloe, sorghum, peanuts, vegetables, tropical fruit

Industries:

tourism, petroleum refining, petroleum transshipment, light manufacturing, financial and business services

 

Exports - commodities:

petroleum products

Imports - commodities:

crude petroleum, food, manufactures

 

Country Links
Central Bank of Curaçao and Sint Maarten
Curaçao Chamber of Commerce & Industry
Intelligence Unit - Curaçao (FIU Curaçao)
Other Useful Links
FATF
US State Department
Transparency International
World Bank
CIA World Factbook

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