Czech Republic Country Summary

FATF Status

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

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in The Czech Republic was undertaken in 2022. According to that Evaluation, The Czech Republic remains Compliant for 6 and Largely Compliant for 29 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 3 of the Effectiveness & Technical Compliance ratings.

The Czech Republic grapples with a multifaceted organized crime landscape, marked by significant activities in drug trafficking, wildlife smuggling, and cyber crimes, often facilitated by both domestic and foreign criminal networks. While the government has implemented robust anti-corruption measures and established a strong legal framework to combat these issues, challenges persist in enforcement and the integration of organized crime into the legitimate economy, necessitating ongoing reforms and collaboration with international bodies to enhance resilience against these threats.

Czechia's economy is characterized as an export-driven, open system, with a significant portion of its GDP (72.7%) reliant on exports, particularly from the automotive and engineering sectors. Despite high productivity and low unemployment rates, the country faced a GDP decline of 0.2% in 2023, primarily due to high inflation and energy price increases linked to geopolitical tensions. The Czech government actively promotes foreign investment through various incentives, while also implementing measures to screen foreign investments for national security concerns, reflecting a commitment to maintaining a stable and competitive investment climate.