National Treasury Welcomes SA’s Removal from EU High-Risk Jurisdictions List

While welcoming the EU’s decision, National Treasury cautioned that the delisting does not signify the end of all challenges within South Africa’s AML/CFT system.

The National Treasury has welcomed the removal of South Africa from the European Union’s list of High-risk Third Country Jurisdictions, marking another significant step in the country’s efforts to strengthen its Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) framework.

This development follows South Africa’s delisting from the Financial Action Task Force (FATF) greylist—officially known as the list of countries under increased monitoring—as well as its removal from the United Kingdom’s high-risk countries list for money laundering and terror financing. Both delistings took effect on 13 October 2025.

Acknowledging Progress, While Noting Remaining Challenges

While welcoming the EU’s decision, National Treasury cautioned that the delisting does not signify the end of all challenges within South Africa’s AML/CFT system.

“National Treasury notes that removal from the FATF and EU lists of high-risk jurisdictions does not mean that all South Africa’s challenges in implementing its AML/CFT system have been resolved, and recognises that much work still needs to be done to strengthen deficiencies in the prevention, identification, investigation and prosecution of money laundering and terrorism financing,” Treasury said.

EU Recognition of Reforms

In its statement, the European Union acknowledged the progress made by South Africa and other African countries in strengthening their AML/CFT regimes.

The EU noted that Burkina Faso, Mali, Mozambique, Nigeria, South Africa and Tanzania had:

• Improved the effectiveness of their AML/CFT systems

• Addressed technical deficiencies identified by the FATF

• Met commitments set out in their respective action plans

As a result, the European Commission concluded that these countries no longer exhibit strategic deficiencies in their AML/CFT frameworks.

Background to the EU Listing

South Africa was added to the EU High-risk Third Country list in August 2023, following its greylisting by the FATF in February 2023. The EU listing was an automatic consequence of this designation.

The listing was made in terms of Article 9(1) of Directive (EU) 2015/849, which requires the identification of third-country jurisdictions with strategic AML/CFT deficiencies to safeguard the EU’s internal market.

Under this framework:

• EU financial institutions were required to apply enhanced due diligence to transactions involving South African entities

• This included more intrusive checks, additional documentation, ongoing monitoring, and senior management approval

Impact on Trade, Investment and Financial Flows

National Treasury noted that these enhanced due diligence requirements added significant friction to financial transactions involving South Africa, affecting:

• Trade

• Cross-border payments

• Investment flows

With South Africa’s removal from the EU list, EU financial institutions are no longer legally required to apply enhanced due diligence solely on the basis of country risk.

However, Treasury clarified that:

• The removal does not compel EU financial institutions to change their internal risk assessment policies

• It does, however, allow willing institutions to reassess and adjust their risk frameworks relating to South Africa

Looking Ahead: New FATF Evaluation Cycle

South Africa is set to enter a new round of FATF mutual evaluation in the coming months, with a final report scheduled for presentation to the FATF plenary in October 2027.

National Treasury confirmed that preparations for this evaluation are already underway, drawing on:

• Lessons learned during the greylisting exit process

• Experience gained in strengthening institutional coordination and compliance

Strengthening Confidence in South Africa’s Financial System

The removal from the EU High-risk Jurisdictions List represents a positive signal to global investors and trading partners, reinforcing confidence in South Africa’s financial integrity and regulatory reforms. Treasury emphasised that continued vigilance, implementation, and enforcement will be critical to sustaining these gains and ensuring long-term resilience of the country’s AML/CFT system.