The European Commission has revised its list of jurisdictions considered high risk for money laundering and terrorist financing, adding two new countries while removing six others that have strengthened their financial crime compliance frameworks.
The changes come under Commission Delegated Regulation (EU) 2026/83, adopted on December 4, 2025, which amends Delegated Regulation (EU) 2016/1675, the legal instrument used by the European Union to identify third countries with strategic weaknesses in their anti-money laundering and counter-terrorism financing (AML/CFT) regimes.
The revised regulation, published in the Official Journal of the European Union on January 9, 2026, adds Bolivia and the British Virgin Islands to the EU’s list of high-risk jurisdictions while removing Burkina Faso, Mali, Mozambique, Nigeria, South Africa, and Tanzania.
EU Seeks to Protect Financial System
The update is part of the EU’s broader effort to safeguard the integrity of its financial markets. Under Directive (EU) 2015/849, the European Commission is tasked with identifying non-EU jurisdictions whose AML/CFT frameworks contain “strategic deficiencies” that could threaten the Union’s financial system.
Officials emphasize that the highly interconnected nature of global financial markets means weaknesses in one jurisdiction can quickly affect others. With large volumes of cross-border financial flows involving EU institutions, vulnerabilities abroad can translate into increased risks for banks and businesses operating within the bloc.
FATF Assessments Drive Changes
The Commission based its decision largely on assessments from the Financial Action Task Force (FATF), the global body responsible for setting international standards to combat money laundering and terrorist financing.
During its plenary meetings in June and October 2025, the FATF updated its list of jurisdictions under “increased monitoring,” commonly referred to as the “grey list.” Bolivia and the British Virgin Islands were added to that list, while six African nations were removed after demonstrating significant regulatory improvements.
The EU’s update reflects those global developments.
Bolivia Added Despite Reform Progress
Authorities in Bolivia committed in June 2025 to working with FATF and the regional body Grupo de Acción Financiera de Latinoamérica (GAFILAT) to strengthen their AML/CFT regime.
Since its mutual evaluation report in December 2023, Bolivia has taken several steps to improve compliance. These include strengthening its understanding of money-laundering and terrorism-financing risks, improving the collection and analysis of financial intelligence, and enhancing mechanisms to seize and confiscate criminal proceeds.
Bolivia has also increased investigative capacity related to terrorism financing and improved procedures for implementing targeted financial sanctions.
However, the European Commission concluded that these efforts have not yet fully resolved the structural weaknesses identified by international evaluators. Authorities still need to implement stronger investigative tools, introduce risk-based supervision of sectors such as real estate agents and accountants, improve beneficial ownership transparency, and increase the number of money-laundering investigations and prosecutions.
Until those reforms are completed, the country will remain classified as high risk.
British Virgin Islands Also Added
The British Virgin Islands, a well-known offshore financial centre, also joined the EU’s high-risk list following its inclusion on the FATF monitoring list in 2025.
The territory has taken several steps to improve compliance since its 2023 mutual evaluation report. These include developing a counter-terrorism financing strategy, increasing international cooperation requests, and conducting risk assessments of the nonprofit sector to identify vulnerabilities to terrorist financing.
Authorities have also enhanced supervision of financial institutions and other regulated sectors and improved coordination for implementing targeted financial sanctions.
Despite these efforts, the Commission determined that additional work remains. Planned reforms include strengthening supervision of trust and company service providers, investment firms and virtual asset service providers, improving the quality of suspicious activity reporting, ensuring accurate beneficial ownership data, and increasing asset confiscation linked to criminal activity.
Six Countries Removed from List
At the same time, six countries were removed from the EU’s high-risk list after making substantial progress in strengthening their AML/CFT systems.
The Financial Action Task Force acknowledged that Burkina Faso, Mali, Mozambique, Nigeria, South Africa and Tanzania had implemented the legal and regulatory reforms required under their action plans to address previously identified weaknesses.
As a result, these countries were removed from FATF’s “jurisdictions under increased monitoring” list in 2025.
Following its own review, the European Commission concluded that the jurisdictions had addressed the strategic deficiencies that initially triggered their inclusion on the EU list.
Updated EU High-Risk Country List
After the latest update, the EU’s list of high-risk third countries includes 23 jurisdictions, among them Afghanistan, Algeria, Angola, Cameroon, Democratic Republic of the Congo, Lebanon, Myanmar, Venezuela, Vietnam, and Yemen, among others.
Implications for Banks and Compliance Teams
When a country is included on the EU’s high-risk list, financial institutions operating within the EU must apply enhanced due diligence when dealing with clients or transactions connected to that jurisdiction.
This typically involves stricter customer identification procedures, deeper analysis of beneficial ownership structures, and increased monitoring of cross-border financial transactions.
For compliance teams and financial institutions, the update reinforces the importance of monitoring global AML developments and aligning risk management frameworks with evolving regulatory expectations.
Regulation to Take Effect Soon
The new regulation will enter into force 20 days after its publication in the Official Journal of the European Union and will apply directly across all EU Member States without the need for national legislation.
By FCCT Editorial Team
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