Although BiH is practically on the verge of being placed on the gray list of the Financial Action Task Force (FATF), little has been done to prevent this development. The FATF is an influential international organization whose assessments, opinions and recommendations have a significant impact on how financial institutions, governments and international organizations evaluate a country’s financial system.
Report ready
The Committee of Experts of the Council of Europe for the Evaluation of Measures to Combat Money Laundering and Financing of Terrorism (MONEYVAL), a body within the FATF whose decisions will have the greatest impact on whether BiH will be returned to the gray list, has practically already prepared a report on the basis of which the decision will be made, and BiH has still not fulfilled the key recommendations to prevent this from happening.
Some of the most important obligations of BiH are the adoption of the law on asset confiscation and management, as well as the law on targeted financial sanctions for terrorism, financing of terrorism and the proliferation of weapons of mass destruction. It is also necessary to establish a register of real owners of legal entities.
By all accounts, there are obviously power centers in BiH that do not agree with the introduction of stricter control of the flow of money from and into BiH, and all parts of BiH will pay the price.
FATF and MONEYVAL without comment
Neither FATF nor MONEYVAL wanted to talk about the consequences that BiH could have if it is returned to the list.
“Given that assessments of BiH are carried out by MONEYVAL, one of the nine regional bodies in the FATF system of which BiH is a member, for additional information it is necessary to contact MONEYVAL directly. For information, the last mutual evaluation of BiH by MONEYVAL was carried out in 2024. The report contains an assessment of the country’s compliance with FATF standards, as well as recommended measures for further improvement. The next mutual evaluation of BiH is planned for 2031,” they told us.
In response to the question we sent to MONEYVAL, the Council of Europe explained to us that we should contact the FATF.
“As far as MONEYVAL is concerned, BiH is currently in the process of enhanced monitoring, and will report to MONEYVAL in December 2026, but exclusively on technical compliance. Issues related to FATF procedures, the observation period and the FATF report on these issues fall under the jurisdiction of FATF, and all information in that context can be published exclusively by them,” they told us yesterday.
Serious consequences
Although neither the FATF nor the MONEYVAL, i.e. the Council of Europe, have received answers regarding the specific consequences, they can be divided into several areas… The first will refer to the financial consequences, because international banks will see BiH as a country of higher risk, which will have consequences for the price of money, i.e. the level of interest rates and banking transactions. For example, a company in BiH will have to pay more for transactions abroad, and the duration will be longer.
Also, it will be more difficult for Bosnia and Herzegovina to enter the European digital payment system, which will have consequences for ordinary citizens as well.
The next consequence will relate to foreign investments, because investors will have a harder time deciding to invest in Bosnia and Herzegovina. When the country was considered a higher risk area, there is less chance that “ordinary” investors will come to the country, and there is a greater chance that speculators and high-risk investors will be interested who will seek higher earnings for their business.
As was recently warned by the EU Delegation, BiH. the European path could also be threatened, and the country could further lag behind the rest of the region. The public sector of BiH will also be subject to greater attention from international partners, which will further threaten their competitiveness. Also, the blacklist inevitably means more bureaucracy, which will affect ordinary citizens as well, they write Independent newspaper.
