Morocco is tightening controls on offshore holding companies, requiring them to closely track money flows, identify their real owners and report suspicious transactions as part of a broader push against money laundering and terrorist financing.
The Foreign Exchange Office issued a new circular Aug. 10 setting out stricter due diligence and internal monitoring rules for offshore holding companies.
The rules require each company to build a compliance system based on the size of its activities and the risks it faces.
The system must cover customer checks, beneficial-owner identification, transaction monitoring, verification of where money comes from and where it goes, and the retention of records.
Companies must identify anyone who directly or indirectly owns at least 25% of a company’s capital or voting rights.
For legal entities, they must collect information on directors, shareholders and beneficial owners, using reliable sources including Morocco’s Public Register of Beneficial Owners.
They must also assess risks linked to their customers, transactions and geographic exposure, and regularly update those assessments. The findings must be documented and shared with senior management and made available to the Foreign Exchange Office.
The rules put particular attention on high-risk customers and deals, including politically exposed people, transactions involving high-risk countries and companies with unusually complex ownership structures.
For such cases, companies must collect additional information, establish the reasons for transactions, obtain senior management approval and carry out closer monitoring.
They must also verify the source of funds and pay special attention to relationships conducted without the customer being physically present.
Unusual or complex transactions must be reviewed when they lack a clear economic purpose, involve amounts that do not fit a customer’s normal activity or have an unusual level of complexity.
If suspicion remains or is confirmed, the transaction must be reported to Morocco’s National Financial Intelligence Authority, known as the ANRF.
Offshore companies must also check their customer databases against lists linked to U.N. sanctions and immediately freeze assets belonging to sanctioned people or entities.
Each company must appoint an anti-money laundering and counter-terrorist financing compliance officer to oversee the system, review unusual transactions and coordinate with the relevant authorities.
The circular also requires companies to keep transaction and due diligence records for 10 years. They must provide requested documents and information to the authorities within the required deadlines.
Companies that fail to meet the requirements can face disciplinary or financial penalties under Morocco’s anti-money laundering law, Law No. 43-05, as well as possible criminal sanctions.
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