The Government has introduced changes to regulations in the Anti-Money Laundering and Countering Financing of Terrorism Act (AML/CFT Act), following a Ministry of Justice-led review held between July 2021 and 30 June 2022.
The review was tabled in Parliament on 7 November 2022 and you can find it here:
Read the final report of the statutory review [PDF, 5.4 MB]
The review focused on how the AML/CFT Act has performed since 2017 as well as whether any changes were necessary or desirable. The review assessed the extent to which the AML/CFT Act has achieved its purposes, as well as the cost and maturity of the regime and its consistency with Te Tiriti o Waitangi. The findings and recommendations were based on private sector and community feedback, agency views, and the Financial Action Task Force (FATF)’s conclusions in New Zealand’s Mutual Evaluation Report(external link).
Overall, the Ministry found that the AML/CFT Act provides for a generally sound regulatory regime that is broadly effective at detecting and deterring money laundering and terrorism financing. However, it found some issues prevent the regime from being the best it can be for New Zealand and that major improvements were needed. This is largely consistent with the findings of the FATF when they conducted the Mutual Evaluation of New Zealand in 2021.
In October 2022, Cabinet agreed to the Ministry’s proposal to implement the review’s immediate recommendations, which required issuing new or amending existing AML/CFT regulations. Officials are doing further policy work on medium-term and long-term changes. These require either:
Between March and April, we consulted the public on a draft package of regulations to implement the review’s immediate changes which responded to the following issues:
As a result of the consultation, and submissions received, changes were made to over half of the 80 proposed regulations. The changes to the drafting:
We are currently drafting a summary of submissions which will be publicly available once completed. This summarises and responds to all submissions made on the Regulations.
Through the drafting process, it became clear that twelve of the proposed changes need to be in primary legislation rather than in regulations, and the Government will progress these changes in due course.
| Changes | # in exposure draft |
| Requiring border cash reports(external link) when moving stored value instruments (such as vouchers and gift cards) and casino chips into or out of New Zealand | Page 8, new regulation 7(2) ‘When cash report must be provided’ (declaring chips and stored value instruments to be bearer negotiable instruments) |
| Exempting a person receiving accompanied cash (cash accompanied by a person) from submitting a border cash reports(external link) | Page 8, new regulation 7A ‘Exemption from providing cash report’ |
| Define professional services in the DNFBP definition | Page 10, new regulation 7B ‘Managing Client Funds’ |
| Define engaging in or giving instructions in the DNFBP definition | Page 11, new regulation 7C ‘Engaging in or giving instructions on behalf of customer to another person’ |
| Define occasional transaction | Page 11, new regulation 10A ‘Definition of occasional transaction’ |
| Enabling money or value transfer service operators to disclose information relating to suspicious activity reports | Page 19, new regulation 24AI ‘Disclosure of information relating to suspicious activity report: operator of money or value transfer service and agents’ |
| Relaxing the address verification requirement under standard CDD |
Page 19, new regulation 24AJ ‘Exemption from address verification requirement’ |
| Prescribing the process that reporting entities must follow when conducting enhanced customer due diligence on trusts |
Page 21, new regulation 12C ‘Enhanced customer due diligence requirement relating to trusts’ |
| Simplified customer due diligence requirements with respect to delegation by senior manager of customer | Page 27, new regulation 33 ‘Simplified customer due diligence: delegation by senior manager of customer’ |
| Enabling members of a designed business group to share a compliance officer | Page 28, new regulation 38 ‘Designated business group may share compliance officer’ |
| Extension to SAR reporting for law firms | Page 28, new regulation 34 ‘Extension of time for reporting suspicious activities: law firms’ |
| Extension to PTR reporting | Page 28, new regulation 35 ‘Extension of time for submitting prescribed transaction report in certain cases’ |
The Regulations will come into force in three stages from 31 July 2023 to 1 June 2025.
The first stage of changes, which come into force on 31 July 2023, are to provide immediate regulatory relief. The second, which comes into force in 2024, introduces new obligations for entities that already have existing AML/CFT obligations. The final stage, which comes into force 1 June 2025, introduces obligations on sectors that were not previously subject to AML/CFT obligations.
You can download and read the consultation document from:
Previous Consultation Document [PDF, 494 KB]
A link to the gazette notice can be found here:
Gazette(external link)
The changes to regulations can be found here: