Serbia amends AML/CFT laws to include WMD financing controls

The Administration for the Prevention of Money Laundering (APML) said amendments to Serbia’s AML/CFT Law and the Law on the Freezing of Assets took effect on 6 December 2024, recasting risk assessment, customer due diligence and asset-freezing controls around updated FATF standards. Source: APML announcement on the application of amendments to the Law on the Prevention of Money Laundering and the Financing of Terrorism and the Law on the Freezing of Assets for the Purpose of Preventing Terrorism and Proliferation of Weapons of Mass Destruction, effective 6 December 2024.

The APML said the changes align Serbia’s framework primarily with FATF Recommendation 1, which requires a risk assessment and risk-based approach to countering money laundering, terrorist financing and WMD proliferation financing. Firms that treated proliferation-financing exposure as a sanctions-only issue now need to read it through the AML/CFT framework.

APML said the amendments introduced the concept of WMD proliferation financing into the AML/CFT Law and expanded customer due diligence measures that obliged entities and relevant authorities must take. Those measures now extend to the prevention of financing of proliferation of WMD, in addition to the prevention of money laundering and terrorist financing. This will require obliged entities to revisit customer risk assessment methodologies, onboarding questionnaires and escalation logic where trade, cross-border goods flows or ownership structures create a plausible proliferation-financing nexus.

There is also a cash-control change with a clearer operational edge. APML said there is now a restriction on a natural person receiving cash on hand under a property sale agreement and a loan agreement of €10,000 or more in dinar countervalue. The legislator’s intention is to route through bank accounts all cash payments of €10,000 or more in dinar countervalue tied to the purchase and sale of goods or real estate, the provision of services and the receipt of loans.

This change will produce a screening-queue volume shift only at the margin, but it has a more direct effect on onboarding and transaction-monitoring controls. Firms handling real-estate transactions, lending activity or higher-value goods and services should check whether front-line teams, customer-facing disclosures and payment-operation procedures still permit cash settlement patterns that the amended framework is trying to move into the banking channel. Where a firm files a SAR or escalates unusual cash activity today, the decision tree may need to distinguish more clearly between ordinary cash-use risk and transactions that should not be settling in cash at all under the revised rules.

APML framed the timing as a standards-alignment exercise. The regulator said the amendments align the relevant legislation with the latest AML/CFT standards and expand the legal architecture for preventing terrorism financing and proliferation financing through both the AML/CFT Law and the asset-freezing law. For supervisors and obliged entities, that pairing matters because it narrows the gap between targeted-financial-sanctions controls and broader AML/CFT risk assessment expectations, rather than leaving proliferation-financing risk controls in a separate policy lane.

The affected population is described by the source as obliged entities and relevant authorities. The materials provided do not specify a narrower firm list, a phased supervision timetable or any separate implementation guidance for sectors.

Compliance teams should test whether enterprise-wide risk assessments reference proliferation-financing risk, whether customer due diligence policies and templates capture that exposure, and whether payment controls flag attempted cash settlement at or above the €10,000 threshold in the situations APML identified. If those updates are missed, the exposure is basic but real: weak supervision readiness, defective CDD records and avoidable failures where prohibited or restricted cash activity is processed without escalation. The amendments came into force on 6 December 2024.