Law No. 49/NA on Anti-Money Laundering and Combatting the Financing of Terrorism (“AML Law”), issued on 21 July 2014, took effect on 24 February 2015.
The AML Law formulates the term, “reporting units”, which may consist of both “financial sector institutions” and “non-financial sector institutions”. “Financial sector institutions” include: commercial banks, micro-finance institutions, loan and credit providers, insurance companies, securities companies, etc. “Non-financial sector institutions” include commercial real estate representations, antique/precious metal dealers, law firms, auditors, etc.
Under the AML Law, all people, including reporting units, must provide information on and act against money laundering and the financing of terrorism. However, the AML Law also provides on certain responsibilities specific to reporting units.
Reporting units are required to verify the identity of customers (e.g., through identity cards, passports, enterprise registration certificates, etc.), as well as the intention and objectives behind the transactions. If unable to do so, then reporting units must not continue or start a business relationship with said customer.
Reporting units must report on the following transactions within three days: those that exceed certain monetary thresholds (which are to be determined by the Bank of Lao PDR in later regulations); and those under suspicion of being connected to money laundering or terrorism financing. Such reports and the existence thereof must remain confidential or else the person filing may be subject to fines and criminal charges. However, reporting units will be indemnified if reports are filed in good faith and are in compliance with the law.