Gulf Cooperation Council (GCC)

GCC, or the Gulf Cooperation Council, comprises six Arab nations. This includes Qatar, Oman, Bahrain, Kuwait, Saudi Arabia, and the United Arab Emirates. The council was formed in 1981 in Abu Dhabi, UAE, but its headquarters reside in Riyadh, Saudi Arabia.

What the GCC Is and Why These Countries Joined Hands?

The GCC ensures unity and coordination among member states because of shared regional concerns and strategic requirements.

The objectives of the GCC include promoting political, economic, social, and administrative relations among the member countries. It has become a collaborative decision-making forum for regulatory coordination and economic integration. It also facilitates concerted efforts in combating crimes like cross-border money laundering in the region.

How does the GCC Promote Regional Cooperation Against Financial Crime?

The GCC members are closely collaborating to tackle money laundering and terrorism by improving their rules, sharing information, and improving coordination across borders. They partner with bodies like the GCC Working Group on AML-CFT, G20, FATF, alongside the National Committee and the Ministry of Foreign Affairs and International Cooperation (MOFAIC).

One of the recent examples of cooperation between GCC countries is the recently signed Memorandum of Understanding (MoU) between Saudi Arabia and Kuwait to strengthen their cooperation in fighting money laundering and terrorist financing. This shows their strong commitment to global AML/CFT standards and better regional cooperation.

The Abraham Accords have also created new opportunities for regional financial cooperation, such as possible convergence on AML/CFT practices across borders.

Although all GCC members have a shared AML/CFT mission, each country has its own risk environment and regulatory institutions, which both pose challenges and opportunities for harmonization.

Understanding AML/CFT Laws Across GCC Member States

Each of the GCC countries has developed its own legal and regulatory framework to prevent money laundering and terrorist financing.

Saudi Arabia passed its anti-money laundering law in 2003 and counter-terrorism financing terrorism in 2013, and the statutes are being enforced by the Saudi Arabian Monetary Authority (SAMA) and the Financial Intelligence Unit (FIU). This system places emphasis on customer due diligence, suspicious transaction reporting, and strict enforcement across both financial and non-financial sectors.

Kuwait has improved its anti-money laundering and terrorist financing legislation after enacting a significant law in 2013. While it has made progress, there are still some gaps in supervision and enforcement.

United Arab Emirates (UAE) has imposed robust KYC (Know Your Customer) regulations and sanctions compliance procedures. Financial free zones such as ADGM (Abu Dhabi Global Market) in Abu Dhabi and DIFC (Dubai International Financial Centre) in Dubai have played a key role in strengthening regulatory enforcement across the country.

In Bahrain, the legal environment and implemented measures have been updated to enhance compliance, particularly in the banking and insurance industries. The Central Bank is taking an active supervisory role, but there is still a need for more coordination between agencies and improved enforcement.

In the past few years, Qatar has revised its AML/CFT legislation and tightened regulations. Its Financial Information Unit (QFIU) has also taken measures to improve data management as well as identify suspicious transactions. However, it lags in the uniform enforcement across the sectors.

Oman has made fundamental steps by establishing its own AML/CFT legislation and regulatory authorities. The legal framework is established, yet implementation continues to evolve. Training, awareness, and enforcement instruments are slowly being enhanced to align with international expectations.

All the GCC states are working to strengthen their systems in combating money laundering and terrorism financing. Some countries are ahead, and some are still catching up.

How AML Regulations within GCC Compare with EU AML Laws?

The EU’s AML system, particularly under the 6th AML Directive (6AMLD), is harmonized across the borders. That means all EU countries follow the same rules, definitions, and enforcement procedures for money laundering and terrorist financing. But GCC countries are not yet fully harmonized in this way. Each GCC member has its own AML/CFT laws, regulators, and risk landscape.

GCC countries have been putting quite an effort into implementing FATF recommendations, but there remain a few discrepancies in terms of member states’ fulfillment of KYC measures, disclosure of beneficial ownership, and application of financial sanctions.

Among GCC member states, only Saudi Arabia is an individual FATF (Financial Action Task Force) member. This membership as a group indicates a broader support for international AML/CFT standards.

A number of countries are conforming to FATF regulations, but complete regional harmonization is still a work in progress. Recent developments like the Saudi-Kuwait MoU and growing bilateral cooperation indicate slow but persistent progress, particularly in high-risk areas such as real estate, charities, and cryptocurrency.

Relative to the EU, the GCC’s AML strategy is evolving from scattered national regulations to gradual regional convergence.

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