FATF Status

Andorra is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The latest follow-up to the Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Andorra was undertaken in November 2021. According to that Evaluation, Andorra was deemed Compliant for 9 and Largely Compliant for 28 of the FATF 40 Recommendations. It remains Highly Effective for 0 and Substantially Effective for 4 with regard to the 11 areas of Effectiveness of its AML/CFT Regime.​

Andorra has established a robust legal framework to combat corruption, money laundering, and terrorism financing, with significant amendments made to its Criminal Code between 2008 and 2016. The country joined the Council of Europe in 1994 and later became a member of the Group of States against Corruption (GRECO) in 2005, leading to the creation of the Unit for the Prevention and the Fight Against Corruption in 2008. Despite these efforts, Andorra has not signed the UN Anticorruption Convention or the OECD Convention on Combatting Bribery.

Andorra's economy is primarily driven by tourism, trade, and commerce, which together account for nearly 60% of its economic activity, alongside a significant financial sector. The country has adopted the euro as its currency and is subject to EU free trade regulations despite not being an EU member. Recent reforms aim to diversify the economy and attract foreign investment, with initiatives focusing on sectors like fintech and innovation.

Andorra has established an open framework for foreign investment, allowing non-residents to own up to 100 percent of Andorra-based companies since the implementation of the Foreign Investment Law in 2012. The government actively promotes foreign investment through initiatives like Andorra Business, which provides support and counseling to both local and foreign investors. Recent reforms, including updates to the Foreign Investment Law in 2022, aim to enhance the ease of doing business and attract more foreign direct investment.