BiH could return to MONEYVAL grey list on Friday after eight years

MONEYVAL, a Council of Europe body, evaluates countries' systems for combating money laundering and terrorist financing.

According to the report, a MONEYVAL meeting held in Helsinki in May concluded that Bosnia and Herzegovina had failed to meet several key obligations previously set by international evaluators. As a result, the country was recommended for a return to enhanced monitoring, with a final decision expected at a plenary session later this week.

If confirmed, Bosnia would once again be classified among countries with significant shortcomings in their anti-money laundering and counter-terrorist financing frameworks.

According to Politicki.ba, one of the main reasons behind the expected negative assessment is the Federation of Bosnia and Herzegovina's failure to establish a beneficial ownership register, a mechanism international institutions consider essential for identifying hidden ownership structures and preventing financial abuse.

The report also cites the lack of legislation that would allow for more effective confiscation of illegally acquired assets.

Although Bosnian institutions have in recent months attempted to accelerate the adoption of several laws related to financial crime and counter-terrorism financing, sources quoted by the portal said those efforts were insufficient to alter the assessment of international experts.

A return to the grey list would not constitute formal international sanctions, but it could have significant implications for the country's reputation, business environment and financial sector.

Countries under enhanced monitoring often face increased scrutiny from international financial institutions, banks and investors, which can complicate certain financial transactions and negatively affect investment confidence.

Following a formal decision, Bosnia and Herzegovina would be expected to receive a detailed action plan outlining the measures required for removal from the list.

Authorities would be required not only to adopt the necessary legislation, but also to demonstrate its effective implementation through the work of regulators, courts and law enforcement agencies.

Bosnia and Herzegovina was previously under MONEYVAL enhanced monitoring from 2015 to 2018.

It was removed from the grey list after implementing a series of reforms aimed at strengthening its anti-money laundering and counter-terrorist financing framework.

According to Politicki.ba, a possible return to enhanced monitoring is being interpreted as a sign that some of the progress achieved during that period has either stalled or failed to keep pace with evolving international standards.

For now, there has been no official confirmation from MONEYVAL, with a final decision expected following the conclusion of this week's plenary session.