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 since 2008. The country joined the Council of Europe in 1994 and became a member of GRECO in 2005, enhancing its commitment to fighting corruption. Additionally, the Andorran government created the Unit for the Prevention and the Fight Against Corruption in 2008 to centralize efforts against corruption and has implemented various laws to align with international standards, although it has not signed key international anti-corruption conventions.

Andorra's economy, with a population of about 85,000, is heavily reliant on tourism and commerce, which together account for nearly 60 percent of its economic activity. The country has established itself as a wealthy international commercial center, benefiting from a low tax regime and a robust banking sector that contributes significantly to its GDP. Recent reforms aim to diversify the economy and attract foreign investment, while Andorra's per capita income remains above the European average.

Andorra has established an open framework for foreign investments, allowing non-residents to own up to 100 percent of any Andorra-based company since the Foreign Investment Law came into effect in 2012. The government has made recent modifications to this law to facilitate easier establishment of companies and improve oversight mechanisms. Additionally, Andorra Business serves as a support agency for both local and foreign investors, aiming to enhance competitiveness and foster economic diversification.