• A reporting entity must carry out a procedure to verify a customer’s identity before providing a designated service to the customer. However, in special cases, the procedure may be carried out after the provision of the designated service.
• A reporting entity must undertake initial customer due diligence before providing a designated service to the customer. However, in special cases, initial customer due diligence may be carried out after the provision of the designated service.
• Certain pre‑commencement customers are subject to modified identification procedures.
• Certain pre‑commencement customers are subject to modified customer due diligence.
3 Section 4
• Certain low‑risk services are subject to modified identification procedures.
• Simplified customer due diligence may be undertaken in certain low risk circumstances as part of initial and ongoing customer due diligence.
4 Section 5 (definition of applicable customer identification procedure)
5 Section 5
beneficial owner of a person (other than an individual) means an individual who:
(a) ultimately owns (either directly or indirectly) 25% or more of the person; or
(b) controls (directly or indirectly) the person.
business relationship means a relationship between a reporting entity and a customer involving the provision of a designated service or designated services that has, or could reasonably be expected to have, an element of duration.
child: without limiting who is a child of another person for the purposes of this Act, each of the following is the child of a person:
(a) a stepchild or an adopted child of the person;
(b) someone who would be the stepchild of the person except that the person is not legally married to the person’s partner;
(c) someone who is a child of the person within the meaning of the Family Law Act 1975.
de facto partner has the same meaning as in the Acts Interpretation Act 1901.
domestic politically exposed person means:
(a) an individual who holds an office or position (whether or not in or for the Commonwealth) specified in the AML/CTF Rules; or
(b) an individual who is a member of the legislature of the Commonwealth or of a State or Territory; or
(c) a family member of an individual covered by paragraph (a) or (b); or
(d) an individual who is known (having regard to information that is public or readily available) to have:
(i) joint beneficial ownership of a body corporate or legal arrangement with an individual covered by paragraph (a) or (b); or
(ii) sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual covered by paragraph (a) or (b); or
(iii) any other close business relations with an individual covered by paragraph (a) or (b).
family member of an individual who is covered by:
(a) paragraph (a) or (b) of the definition of domestic politically exposed person in this section; or
(b) paragraph (a) of the definition of foreign politically exposed person in this section; or
(c) paragraph (a) of the definition of international organisation politically exposed person in this section;
includes:
(d) a spouse, de facto partner, or other person who is equivalent to a spouse or de facto partner under any applicable law of a foreign country, of the individual; and
(e) a child of the individual; and
(f) a spouse or de facto partner, or other person who is equivalent to a spouse or de facto partner under any applicable law of a foreign country, of a child of the individual; and
(g) a parent of the individual.
foreign politically exposed person means:
(a) an individual who holds a prominent office or position or public function in or for the legislature, executive or judiciary of a foreign country, including an individual who holds any of the following offices or positions:
(i) head of state or head of government;
(ii) member of the executive council of government;
(iii) member of a legislature;
(iv) minister, deputy minister or equivalent office or position;
(v) judge of a supreme court, constitutional court or other court of general jurisdiction or last resort;
(vi) ambassador, high commissioner or charge d’affaires;
(vii) high ranking military officer;
(viii) head or board member of a government body;
(ix) head or board member of a state‑owned company or a state‑owned bank;
(x) member of a governing body of a political party represented in a legislature;
(xi) an office or position prescribed in the AML/CTF Rules; or
(b) a family member of an individual covered by paragraph (a); or
(c) an individual who is known (having regard to information that is public or readily available) to have:
(i) joint beneficial ownership of a body corporate or legal arrangement with an individual covered by paragraph (a); or
(ii) sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual covered by paragraph (a); or
(iii) any other close business relations with an individual covered by paragraph (a).
Note: Foreign country has an extended meaning—see the definition of foreign country in this section.
international organisation politically exposed person means:
(a) an individual who is entrusted with a prominent public function, position or office of a public international organisation, including a head, deputy head or board member in a public international organisation;
(b) a family member of an individual covered by (a);
(c) an individual who is known (having regard to information that is public or readily available) to have:
(i) joint beneficial ownership of a body corporate or legal arrangement with an individual covered by paragraph (a); or
(ii) sole beneficial ownership of a body corporate or legal arrangement on behalf or for the benefit of an individual covered by paragraph (a); or
(iii) any other close business relations with an individual covered by paragraph (a).
KYC information (short for know your customer information) about a customer of a reporting entity means information about the customer that:
(a) provides reasonable grounds for the reporting entity to establish the matters mentioned in subsection 28(2); or
(b) enables the reporting entity to identify or assess the ML/TF risk of the customer.
ML/TF risk, of a customer, means the risks of money laundering, financing of terrorism and proliferation financing that a reporting entity may reasonably face in providing its designated service, or designated services, to the customer.
nested services relationship means a relationship that involves the provision of a designated service by a reporting entity that is a remitter, virtual asset service provider or financial institution to a customer that is a remitter, virtual asset service provider or financial institution where:
(a) the reporting entity provides the designated service at or through a permanent establishment in one country; and
(b) the customer uses the designated service to provide services to its own customers at or through a permanent establishment in another country; and
(c) the relationship is not a correspondent banking relationship.
occasional transaction means the provision of a designated service by a reporting entity to a customer other than as part of a business relationship.
parent: without limiting who is a parent of another person for the purposes of this Act, a person is the parent of another person if the other person is the person’s child because of the definition of child in this section.
person designated for targeted financial sanctions means:
(a) a designated person or entity (within the meaning of regulations made under the Charter of the United Nations Act 1945); or
(b) a designated person or entity (within the meaning of regulations made under the Autonomous Sanctions Act 2011).
politically exposed person means:
(a) a domestic politically exposed person; or
(b) a foreign politically exposed person; or
(c) an international organisation politically exposed person.
pre‑commencement customer: see subsection 36(1).
public international organisation has the same meaning as in section 70.1 of the Criminal Code.
spouse of a person includes a de facto partner of the person within the meaning of the Acts Interpretation Act 1901.