FATF status

Luxembourg 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 Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Luxembourg was undertaken in 2023. According to that Evaluation, Luxembourg was deemed Compliant for 28 and Largely Compliant for 11 of the FATF 40 Recommendations. It was rated Highly Effective for 3 and Substantially Effective for 6 of the Effectiveness Compliance ratings.

Luxembourg has made significant strides in combating corruption, ranking as the ninth least-corrupt country globally in 2023, with a score of 78 on the Corruption Perceptions Index. The government has implemented various measures, including a whistleblower law and compliance with anti-money laundering regulations, while the Committee for the Prevention of Corruption coordinates anti-corruption efforts. Despite some criticism regarding transparency, particularly in government document access, corruption is not seen as a barrier for foreign direct investment, and the legal framework effectively addresses bribery and related offenses.

Luxembourg boasts a resilient economy, ranking as the third-wealthiest country globally based on GDP per capita, despite facing challenges such as a recession in 2023. The economy is heavily reliant on the financial sector, which accounts for about one-third of GDP, and has shown adaptability through a strong financial sector and government support, including a significant economic stimulus package. Strategic investments in infrastructure, digital innovation, and climate initiatives are prioritized in the 2024 budget to enhance competitiveness and purchasing power.

Luxembourg offers a highly attractive investment climate characterized by political stability, transparency, and a strong focus on growth sectors, particularly in finance and technology. The government actively supports foreign direct investment (FDI) with no restrictions on foreign ownership, and it has implemented regulatory reforms to enhance the business environment. Additionally, Luxembourg's strategic location as a gateway to Europe and its robust financial sector make it a prime destination for international investors.