FATF Status

Bosnia & Herzegovina is no longer on the FATF List of Countries that have been identified as having strategic AML deficiencies.

Latest FATF Statement - 23 February 2018

The FATF welcomes Bosnia and Herzegovina’s significant progress in improving its AML/CFT regime and notes that Bosnia and Herzegovina has established the legal and regulatory framework to meet the commitments in its action plan regarding the strategic deficiencies that the FATF identified in June 2015. Bosnia and Herzegovina is therefore no longer subject to the FATF’s monitoring process under its on-going global AML/CFT compliance process. Bosnia and Herzegovina will work with MONEYVAL to improve its AML/CFT framework.

Compliance with FATF Recommendations

It should be noted that the new style FATF Mutual Evaluation has not yet been undertaken. 

Bosnia & Herzegovina was removed from the 4th Round Mutual Evaluation follow-up process in 2020

Corruption in Bosnia and Herzegovina (BiH) is pervasive across political and economic institutions, significantly increasing the risks and costs of doing business. Despite having laws against corruption and being a signatory to the UN Anticorruption Convention, enforcement is weak, with public officials often acting with impunity. The complex regulatory environment, coupled with a lack of transparency and ineffective law enforcement, deters foreign investment and undermines economic growth, while recent legislative efforts to combat corruption have proven inadequate.

Bosnia and Herzegovina (BiH) faces significant economic challenges, including endemic corruption, a complex legal framework, and a weak judicial system, which deter foreign investment. Despite a liberal trade regime and low tax rates, the economy has lower growth rates compared to regional peers, with real GDP expected to grow by 2.8 percent in 2024. The country has also seen significant out-migration of its workforce, which complicates hiring and contributes to a challenging business environment.

Bosnia and Herzegovina (BiH) presents a challenging investment climate characterized by endemic corruption, a complex legal and regulatory framework, and a weak judicial system influenced by political patronage. Despite a liberal trade regime and low corporate tax rates, the country struggles to attract foreign direct investment due to political instability, high levels of bureaucracy, and insufficient protection of property rights. Investors are advised to conduct thorough due diligence and be cautious of legal ambiguities, particularly regarding state property and ownership rights.