Flag

Netherlands Country Summary

73.30 Country Rating /100
View full Ratings Table
Sanctions

No

FATF AML Deficient List

No

Terrorism
Corruption
US State ML Assessment
Criminal Markets (GI Index)
EU Tax Blacklist
Offshore Finance Center

Background Information


Anti Money Laundering

FATF Status

The Netherlands 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 the Netherlands was undertaken in 2022. According to that Evaluation, the Netherlands was deemed Compliant for 10 and Largely Compliant for 28 of the FATF 40 Recommendations. It was deemed Highly effective for 2 and Substantially Effective for 5 of the Effectiveness & Technical Compliance ratings.

US Department of State Money Laundering assessment (INCSR)

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

Overview

The Netherlands is a major trade and financial center and, consequently, an attractive venue for money laundering.  The Netherlands is generally making progress addressing money laundering vulnerabilities.    

Six islands in the Caribbean are part of the Kingdom of the Netherlands (the Kingdom): 

Bonaire, St. Eustatius, and Saba are special municipalities; and Aruba, Curacao, and Sint Maarten are countries.  The Netherlands collaborates to ensure the independence of the courts and to combat cross-border crime and drug trafficking within the Kingdom.  The law enforcement memorandum of understanding between the four Kingdom countries and the United States for joint training and information sharing remains active.

Sanctions

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

Bribery & Corruption

Rating                                                                           (100-Good / 0-Bad)

Transparency International Corruption Index                           79

World Governance Indicator – Control of Corruption             97

Corruption does not represent a constraint to business in the Netherlands. Petty corruption is almost non-existent, and the public administration is transparent, efficient and holds high ethical standards. The Dutch Penal Code makes it illegal for anyone to give or receive a bribe in the public or private sector, including a foreign public official. Dutch and foreign companies and their subsidiaries can be held liable for corruption offences committed by individuals working on their behalf and can be ordered to pay up to 10% of their turnover. Facilitation payments are not permitted, while gifts and hospitality may be considered illegal depending on the intent and benefit obtained. The legal framework to fight corruption generally complies with the provisions of the major anti-corruption conventions. Despite increased efforts to crack down on transnational bribery, the country has been criticised by the OECD for insufficient investigation and prosecution activities. Bribery is not widespread in the Netherlands. For further information - GAN Integrity Business Anti-Corruption Portal

Economy

The Netherlands consistently ranks among the world’s most competitive industrialized economies. It offers an attractive business and investment climate and remains a welcoming location for business investment from the United States and elsewhere.

Strengths of the Dutch economy include the Netherlands’ stable political and macroeconomic climate, a highly developed financial sector, strategic location, well-educated and productive labor force, and high-quality physical and communications infrastructure. Investors in the Netherlands take advantage of its highly competitive logistics, anchored by the largest seaport and third-largest airport in Europe. In telecommunications, the Netherlands has one of the highest levels of internet penetration in the European Union (EU) at 92 percent and hosts one of the largest data transport hubs in the world, the Amsterdam Internet Exchange.

The Netherlands is among the largest recipients and sources of foreign direct investment (FDI) in the world and one of the largest historical recipients of direct investment from the United States. This can be attributed to the Netherlands’ competitive economy, historically business-friendly tax climate, and many investment treaties containing investor protections. The Dutch economy has significant foreign direct investment in a wide range of sectors including logistics, information technology, and manufacturing. Dutch tax policy continues to evolve in response to EU attempts to harmonize tax policy across member states.

The coalition government announced in early 2022 plans to be climate neutral by 2050. The government said it would adjust domestic climate goals to at least 55 percent CO2 reduction by 2030 compared to 1990, with ambitions to aim higher for a 60 percent reduction. The government has named a Minister for Climate and Energy Policy to work on domestic issues in addition to a Climate Envoy focused on international efforts. The Netherlands joined the U.S.-EU Global Methane Pledge and promised to end all investment in new coal power generation domestically and internationally. In April 2022, the government joined the Agriculture Innovation Mission (AIM) for Climate. The 2019 National Climate Agreement contains policy and measures to achieve climate goals through agreements with various economic sectors on specific actions. The participating sectors include electricity, industry, “built environment,” traffic and transport, and agriculture.

In September 2022, the Dutch Central Planning Bureau (CPB) published its 2023 economic projections. The outlook was marked by uncertainty, due mainly to Russia’s further invasion of Ukraine. The government budget for the fiscal year 2023 is $388 billion (€395 billion), up from $330.1 billion (€336 billion) in 2022. The budget keeps the 2023 deficit at three percent of GDP and is geared towards mitigating the economic impact of rising energy prices brought on by Russia’s invasion of Ukraine. A price cap on gas and electricity prices for consumers has been in effect since January 1 in addition to a program that subsidizes (part of) the energy bills of small to medium-sized enterprises (SMEs), provided they meet several requirements. The government has indicated price caps will be scrapped by 2024. American businesses operating in the Netherlands raised concerns over the limited scope of the cabinet’s SME support program, arguing it did nothing to alleviate the economic impact of the increasing gas prices. As of March 2023, energy prices decreased substantially, and the Netherlands has reduced its dependence on Russian liquified natural gas (LNG) to single-digit percentages. As a result, the Embassy assesses as low the likelihood that price volatility similar to w-hat was brought on by Russia’s invasion of Ukraine will recur in the short to medium term.

The CPB estimates inflation will hover around 3.5 percent for the remainder of 2023, down from 10 percent at the end of 2022. The combination of high energy prices and rising interest rates has resulted in the CBP adjusting its previous 2023 growth estimate of 1.7 percent to 0.9 percent. The Netherlands’ unemployment rate is expected to hover around 3.6 percent for the remainder of 2023. Due to several factors, including a significant share (36 percent) of the Dutch working population being employed part-time, businesses continue to face difficulties recruiting qualified staff. Government debt is expected to rise to 61 percent of GDP by 2025 due to increased spending under the coalition government, including on defense, outlays to support an aging population, and support to low-income families to offset inflation in energy and food prices.

According to the U.S. Bureau of Economic Analysis (BEA), when measured by country of foreign parent company, the Netherlands was the second largest destination for U.S. FDI in 2021 (after the UK), holding $885 billion out of a total of $6.5 trillion in outbound U.S. investment – about 13.6 percent. Investment from the Netherlands contributed $629 billion FDI to the United States in 2021, making it the second largest investor in the United States for that year. The United States attracted $5 trillion total inbound FDI to the United States in 2021, meaning that the Netherlands accounted for about 12.6 percent. Measured by ultimate beneficial owner (UBO), the Netherlands was the seventh largest investor at $251 billion. For the Netherlands, outbound FDI to the United States represented 17 percent of all direct investment abroad.

 

Country Links

Financial Intelligence Unit - Netherlands (FIU-NL)​

Netherlands Authority for the Financial Markets 

Netherlands Bank

Floating Section Image

Buy Full Netherlands Report


$25 one time payment
The full report features:
  • Risk Analysis
  • Corruption
  • Economy
  • Sanctions
  • Narcotics
  • Executive Summaries
  • Investment Climates
  • FATF Status
  • Compliance
  • Key Findings
Buy Full Report
Floating Section Image

Unlimited Reports


$40 Monthly
Get Started