The Faroe Islands is an autonomous territory within the Kingdom of Denmark. Information for Denmark may be included below:

FATF Status

Denmark 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 Denmark was undertaken in February 2021. According to that Evaluation, Denmark was deemed Compliant for 6 and Largely Compliant for 32 of the FATF 40 Recommendations. It was deemed Highly Effective for 0 and Substantially Effective for 3 of the Effectiveness & Technical Compliance ratings.

Denmark is recognized as one of the least corrupt countries globally, with strong anti-corruption laws and enforcement mechanisms in place. However, recent reports indicate that Denmark prioritizes domestic corruption over foreign bribery, leading to insufficient detection and prosecution of foreign bribery cases. The OECD has recommended that Denmark enhance its strategies to combat foreign bribery, including developing a comprehensive national policy and increasing awareness of the risks involved.

The economy of the Faroe Islands is heavily reliant on fishing and fish processing, which are key contributors to its GDP. Despite past economic challenges in the early 1990s, the country has recovered, boasting a GDP of approximately $3.556 billion and a real GDP per capita of $71,500, although it remains vulnerable due to its dependence on the fishing sector.

The investment climate in the Faroe Islands benefits from a high degree of autonomy from Denmark, enabling the establishment of independent trade agreements and policies. The government actively seeks to attract investments, particularly in information technology and business projects, while the unique foreign ownership allowance in the fishing industry presents opportunities for potential investors. However, challenges such as the economy's heavy reliance on fishing and the out-migration of young talent may hinder long-term growth and diversification of investments.