The British Indian Ocean Territory is a British Overseas Territory of the United Kingdom. Information for the United Kingdom may be included below:

FATF Status

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

Compliance with FATF Recommendations

The last follow-up Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in the United Kingdom was undertaken in 2022. According to that Evaluation, the United Kingdom was deemed Compliant for 24 and Largely Compliant for 15 of the FATF 40 Recommendations. It remains rated Highly Effective for 4 and Substantially Effective for 4 of the Effectiveness & Technical Compliance ratings.

The British Indian Ocean Territory, as a British Overseas Territory, follows the UK's legal framework regarding corruption and bribery. The UK Bribery Act 2010 provides a comprehensive legal structure to combat bribery, holding both UK and foreign companies accountable for corrupt practices, regardless of where they occur. The Serious Fraud Office effectively investigates and prosecutes corruption, and recent enhancements to the Unexplained Wealth Order regime allow for deeper scrutiny of assets that appear disproportionate to lawful income.

The economy of the British Indian Ocean Territory (BIOT) is predominantly driven by military installations on Diego Garcia, which limits economic diversification. With no industrial or agricultural sectors, the territory's income is primarily derived from services supporting military operations, while recent disputes with Mauritius have led to increased oil exports. The establishment of a marine reserve has restricted commercial fishing, which previously contributed significantly to the territory's income.

The investment climate in the British Indian Ocean Territory is heavily influenced by its role as a military base, which limits commercial opportunities for private investors. With no permanent inhabitants and a legal framework governed by UK law, investment is primarily directed towards supporting military operations rather than developing a diverse economic environment. Additionally, ongoing sovereignty disputes with Mauritius may create uncertainties that deter potential investors.