Monaco’s exit from the Financial Action Task Force (FATF) grey list opens the door for the Andorran Financial Intelligence Unit (UIFAND) to revise its technical communication CT-03/2026 and remove the country from its high-risk jurisdiction list. For high-net-worth individuals moving funds or structuring investments between the Principality of Monaco and the Principality of Andorra, this means an immediate shift from banking supervision with enhanced due diligence measures to ordinary risk analysis, shortening wealth transfer timelines and reducing bureaucratic friction.
- End of automatic enhanced monitoring: Andorran obliged entities (banks, notaries, tax advisors, and lawyers) will no longer be forced by preventive regulations to systematically categorize every transaction originating from or destined for Monaco as high-risk.
- Reduced opening and transfer times: Banking onboarding and capital transfers to acquire assets or establish deposits in Andorra will experience a substantial reduction in requests for additional exhaustive documentation.
- Sustained focus on virtual assets: The FATF maintains pressure on virtual asset service providers (VASPs), so crypto or digital asset operations between both financial hubs will continue to be subject to strict control standards.
What the classification of Monaco under UIFAND’s technical communication CT-03/2026 entailed
In June 2024, the FATF placed Monaco on its list of jurisdictions under increased monitoring due to technical deficiencies in its anti-money laundering and counter-terrorist financing protocols. As a direct consequence of this international mandate, national supervisory bodies had to tighten their stance. In Andorra, the UIFAND formalized this obligation through its technical communication CT-03/2026, imposing the mandatory application of enhanced due diligence (EDD) measures on all obliged entities in the country.
In daily financial practice in Andorra, this meant that any individual or legal entity intending to transfer funds from a Monegasque bank account, liquidate an investment position, or justify the origin of funds to apply for residency in Andorra had to undergo a dual regulatory scrutiny:
- Exhaustive documentary justification of the primary origin of funds, with statements or certificates issued by the Monegasque financial institution being insufficient.
- Escalated approval by the Compliance department of the Andorran entity, which delayed ordinary transfers for weeks.
- Enhanced review at the notary’s office when formalizing real estate investment deeds or corporate formations involving capital from the Mediterranean microstate.
Following the FATF plenary meeting in late October 2026, which confirmed that Monaco has corrected the regulatory and institutional deficiencies noted over more than two years, the jurisdiction has regained its ordinary compliance status. This clears the way for the UIFAND to repeal or adjust communication CT-03/2026, normalizing operational relations between both European financial centers.
Difference in operations: Enhanced vs. ordinary due diligence
The end of the grey list does not mean an absence of control. The Andorran banking system operates under European Central Bank standards and European anti-money laundering regulations, always applying risk-based due diligence. However, the operational change upon exiting the high-risk category is substantial for the investor.
| Operational aspect | With Monaco on grey list (Mandatory EDD) | After FATF exit (Standard risk) |
|---|---|---|
| Average bank verification time | 3 to 6 weeks for complex transfers or openings. | 3 to 7 business days depending on the clarity of the source of funds. |
| Required traceability | Complete multi-year banking history, original sales contracts, and crossed notary certificates. | Standard bank certification from the origin entity and basic supporting contracts. |
| Compliance department intervention | Mandatory review by risk committees and escalation to management. | Ordinary technical approval by the analyst assigned to the account. |
| Commercial and notary operations | Precautionary retention of notary files until UIFAND enhanced validation. | Ordinary processing in accordance with the Andorran anti-money laundering law. |
Impact on individuals moving their residence to Andorra
Monaco and Andorra share a similar profile of residency applicants: high-net-worth individuals (HNWIs), digital entrepreneurs, elite athletes, and families with international capital income. In recent years, a growing number of residents in Monaco have opted for Andorra, seeking more space, tranquility, and a competitive and transparent tax framework, where taxes in Andorra set a maximum rate of 10% for both Personal Income Tax and Corporate Tax.
For those deciding to move their wealth base through residency without lucrative activity (regulated in Article 96 of the Immigration Law modified by Law 2/2026), Monaco’s change of status has immediate consequences. This modality requires a minimum investment of 1,000,000 euros in Andorran assets (or 400,000 euros in the Housing Fund), in addition to the non-refundable deposit of 50,000 euros with the Andorran Financial Authority (AFA).
When the funds intended to cover these requirements came from Monegasque accounts, the prior compliance process with Andorran banks to issue the financial certificates required by the Immigration Service suffered significant bottlenecks. Andorran compliance departments requested extremely detailed chains of custody for the money due to the regulatory obligation imposed by the UIFAND. With Monaco’s exclusion from the grey list, the contribution of funds from financial entities in that principality regains agility comparable to that of funds from France, Spain, Switzerland, or any other member state of the European Economic Area.
Repercussions for company creation and asset holding
Entrepreneurs with corporate structures in Monaco who intend to create a company in Andorra to operate internationally will encounter less friction in the foreign investment process. Although the Companies Registry and Andorran banks continue to exhaustively check the beneficial ownership (UBO), removing Monaco from monitoring lists avoids additional obstacles associated with non-cooperative or deficient jurisdictions.
A common illustrative example is the transfer of dividends or accumulated reserves in a Monegasque entity to the Andorran parent company or subsidiary:
Illustrative example: An Andorran holding company receives a dividend of €1,500,000 from a subsidiary in Monaco. Under communication CT-03/2026, the Andorran bank was legally required to request multi-year audited balance sheets, minutes of the Monegasque board, and exhaustive verification of the origin of each cash flow. With the exit from the FATF list, the receiving entity will apply the ordinary protocol: verification of the distribution agreement, standard accounting justification, and proof of corresponding taxation, processing the credit in a significantly shorter period.
The FATF warning on virtual assets: no relaxation for the crypto sector
One aspect that investors should not overlook in the latest FATF resolution is the explicit mandate to accelerate the implementation of its standards on virtual assets. The organization has strongly warned about the need to exercise extreme vigilance regarding the use of crypto-assets for money laundering and international fraud.
This means that Monaco’s operational normalization benefits fiat money, traditional investment portfolios, public debt, and conventional corporate holdings. However, those assets originating from unrealized gains in crypto-asset platforms based in Monaco or managed by intermediaries without a fully licensed VASP will continue to face restrictive analysis by Andorran banks, which apply a criterion of maximum regulatory prudence endorsed by the AFA.
Who benefits from this measure and who should remain cautious
The technical normalization is positive news for a very specific investor profile:
- Directly benefits: Residents or former residents in Monaco who have purchased or are about to purchase real estate in Andorra for amounts exceeding €800,000 and needed to channel funds from Monegasque banking entities without contractual delays.
- Benefits managers and family offices: Those who coordinate investment portfolios between both jurisdictions and needed to move liquidity to seize investment opportunities in financial instruments or Andorran funds (which count toward passive residency for a maximum of 36 months).
- Does not exempt from control: Complex structures with intermediate shareholders in tax havens or non-cooperative jurisdictions, nor funds originating from activities that cannot be documentarily verified. The FATF exit is not an amnesty on compliance; it simply eliminates a legal presumption of aggravated risk.
Sources
- News about Monaco’s exclusion from the grey list: Diari d’Andorra.
- Andorran financial regulatory body: Autoritat Financera Andorrana (AFA).
- Andorran Financial Intelligence Unit: UIFAND.
- Official regulatory publications of the Principality: Butlletí Oficial del Principat d’Andorra (BOPA).
If you plan to move your wealth, open operational bank accounts, or plan your family’s tax relocation from another European jurisdiction, it is essential to evaluate the prior traceability of your assets to ensure a smooth entry into the Andorran financial system. You can request a detailed consultation to analyze your specific case with our team.