AML

In the area of Anti-Money Laundering (AML), the Japanese authorities are preparing for the next round of FATF mutual evaluation. The authorities have shifted gear from a rule-based approach to a principle-based approach. In April 2024, the FSA revised Q&A, no longer requiring a strict time limit of 24 hours on the screening of sanctioned persons. In addition, they allow customer refresh cycles other than the “1-2-3 year cycle” unless it would entail higher risks. In the meantime, however, there is a delay in one of the areas for improvement announced by the Government in August 2021, in response to the FATF’s evaluation report of Japan; i.e., establishment of a central repository of information on Ultimate Beneficial Owners (UBOs) of corporates. As of the end of 2024, there is not a clear sign of progress on this issue.