"Commerce": New regulations to combat money laundering in gold and real estate

The Minister of Commerce and Industry, Osama Al-Boudi, issued Ministerial Decisions No. 172 and No. 173 for the year 2026, concerning the regulations governing the compliance of institutions and companies operating in the field of gold, precious stones, and precious metals trade, as well as real estate brokers and intermediaries, with anti-money laundering (AML) and counter-terrorist financing (CFT) requirements.

In a statement to the Kuwait News Agency (KUNA) on Tuesday, the Ministry of Commerce and Industry emphasized that these decisions come within the framework of enhancing compliance levels and regulating the obligations of sectors under its supervision, thereby supporting efforts to combat money laundering and terrorist financing.

The ministry stated that Decision No. 172 obligates institutions and companies operating in the aforementioned field to establish internal policies, procedures, and control systems commensurate with the size and nature of their business and the level of risks they face. It added that the decision adopts a risk-based approach by identifying and assessing money laundering and terrorist financing risks associated with customers, products, services, transactions, and geographic areas, and by periodically reviewing these assessments. Furthermore, it mandates the implementation of customer due diligence measures, verification of customer and beneficial owner identities, understanding the purpose of the business relationship, and continuous monitoring of transactions.

The ministry clarified that the decision strengthens due diligence procedures in high-risk cases and prohibits establishing or continuing a business relationship or executing a transaction if the necessary verification requirements cannot be met or if there is suspicion that the transaction is linked to money laundering or terrorist financing. It also obligates covered entities to report suspicious transactions, maintain records, train employees, and cooperate with regulatory and competent authorities.

The ministry noted that Decision No. 172 repeals Ministerial Decision No. 431 of 2016 and any provisions conflicting with its terms, and stipulates its publication in the Official Gazette, with implementation effective from the date of publication.

The ministry explained that the second decision, No. 173, applies to companies and institutions practicing real estate brokerage and intermediation, obligating them to establish internal policies, procedures, and control systems commensurate with the size and nature of their business and the level of risks they face. It added that the decision obligates covered entities to identify, assess, and understand risks related to money laundering, terrorist financing, and the financing of weapons proliferation, and to apply a risk-based approach. This includes verifying customer and beneficial owner identities, understanding ownership and control structures, continuously monitoring business relationships and transactions, and updating data and documents as needed.

It was reported that the decision requires the application of enhanced due diligence measures in high-risk cases and transactions, while allowing simplified procedures for low-risk cases according to established controls. It also obligates the abstention from establishing a business relationship or executing a transaction if due diligence procedures cannot be completed.

The ministry pointed out that the decision obligates companies and institutions to retain records, documents, and data related to customers and transactions for a period of no less than five years, and to report suspicious transactions to the Kuwait Financial Intelligence Unit (KFIU), while prohibiting the disclosure of information related to such reports. It also mandates taking necessary measures to implement targeted financial sanctions.

Furthermore, the decision requires the appointment of a compliance officer, the provision of effective internal control systems, and continuous training programs for employees, as well as subjecting policies and procedures to independent and effective reviews. The Ministry of Commerce and Industry will oversee compliance and take necessary regulatory actions.

The ministry noted that Decision No. 173 repeals Ministerial Decision No. 430 of 2016 concerning the regulations for combating money laundering and terrorist financing for real estate brokers and intermediaries, and stipulates its publication in the Official Gazette, with implementation effective from the date of publication.