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Algeria has committed to participating in international efforts aimed at preventing the spread of armaments and combating terrorism, criminalizing the financing of the proliferation of weapons of mass destruction under Law 23-01 of February 7, 2023. This law was enacted in response to Security Council resolutions, particularly Resolution 1540 of 2004, and based on recommendations from the Financial Action Task Force, including Article 7 and Direct Outcome 11. This study focuses on legislative efforts in Algeria to prevent financing of the proliferation of weapons of mass destruction in light of the new Law 23-01 on preventing money laundering and terrorist financing for the year 2023, as well as Algeria's international obligations on this matter. These efforts may elevate Algeria's status among cooperating countries working to prevent and prohibit financing of weapons of mass destruction.
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United Nations, Counter-Terrorism Office "Chemical, Biological, Radiological and Nuclear Terrorism" is available on the following website: https://www.un.org/counterterrorism/ar/cct/chemical-biological-radiological-and-nuclear-terrorism
Law No. 23-01, dated February 7, 2023, amending and supplementing Law No. 05-01 of February 6, 2005, relating to the prevention of money laundering and terrorist financing, Official Journal of the Democratic People's Republic of Algeria No. 80, issued on February 8, 2023.
Mutual Assessment Report "Anti-Money Laundering and Counter-Financing of Terrorism Measures" Middle East and North Africa Financial Action Task Force - MENAFATF, issued in May 2023, p. 32. https://www.fatf-gafi.org/content/dam/fatf-gafi/fsrb-mer/MENAFATF-MER-Algeria-2023-Arabic.pdf.coredownload.inline.pdf
The Law 23-01 includes many amendments and supplements relating to various aspects covered by this law. However, in this study, we will focus on those related to the prevention of money laundering, terrorist financing, and proliferation financing of weapons of mass destruction. The project sets out the duties of those involved in the prevention of money laundering, terrorist financing, and proliferation financing of weapons of mass destruction, and their countermeasures, as well as requiring those subject to take appropriate measures and assessments to identify and assess the risks of money laundering and terrorist financing. However, it is worth noting briefly the most important other amendments related to the subject:
- General provisions axis, where some terminologies were reviewed, and new definitions were added.
- Axis of detection, which clarified that the text obliges those subject to report to the specialized body every operation suspected to be related to funds obtained from an original crime or related to money laundering, and/or related to terrorist financing or the financing of proliferation of weapons of mass destruction.
- Axis of International cooperation, where the legislature widened the field of international cooperation by enabling the specialized body to inform other state authorities that perform similar tasks about the information available to them concerning operations that appear to aim at money laundering or terrorist financing, which includes the financing of proliferation of weapons of mass destruction and the original crimes related to them.
- Axis of Criminal provisions, where the criminal provisions in force in the law were reviewed, and new actions were criminalized.
It includes United Nations Security Council resolutions imposing targeted financial sanctions for the financing of proliferation of weapons of mass destruction: 1718 (2006) 1874 (2009) 2087 (2013) 2094 (2013) 2270 (2016)2321(2016) 2356(2017
Executive Office for Control and Proliferation "Manual guide for combating armament for designated financial and non-financial institutions and service providers of virtual asset" United Arab Emirates, available on the following website: https://www.uaeiec.gov.ae/API/Upload/DownloadFile?FileID=9320d554-89f7-4df6-805e-d353fd1803bb , p.4.
Anti-Money Laundering and Counter-Terrorism Financing Unit "Manual guide for financial institutions on combating the proliferation of armament" Arab Republic of Egypt, available on the following website: https://mlcu.org.eg/upload/uploadeditor/files/%D9%82%D9%88%D8%A7%D8%B5 , p.5
The International Standards on Combating Money Laundering and Financing of Terrorism, Recommendations of the Financial Action Task Force FATF. Updated version - March 2022 is available on the following website: https://mlcu.org.eg/ar/1069/%D8.
This was announced by the Algerian Minister of Justice on the occasion of discussing the draft amendment to Law 05-01 relating to the prevention of money laundering and terrorist financing on January 5, 2023, see the website: http://www.majliselouma.dz/index.php/ar/2016-10-05-06-52-20/4524-2023-01-05-14-03-01
Article 18 bis of the Algerian Penal Code stipulates the following: "The sanctions applicable to legal persons in criminal matters are as follows:
- A fine equivalent to one or five times the maximum fine provided for in the law imposing the penalty on natural persons for the crime.
- One or more of the following supplementary penalties:
- The dissolution of the legal person,
- The closure of the establishment or one of its branches for a period not exceeding five (5) years,
- The exclusion from public procurement for a period not exceeding five (5) years,
- The prohibition of practicing one or more direct or indirect professional or social activities, permanently or for a period not exceeding five (5) years.
- Seizure of the item used in committing the crime or resulting from it,
- Publication and posting of the conviction sentence,
Placement under judicial custody for a period not exceeding five years, with custody focusing on the activity that led to the crime or that was committed during the crime.
Available at the following website: https://www.fatf.gafi.org/media/fatf/documents/reports/Typologies%20Report%20on%20Proliferation%20Financing.p
FATF, "Guide on Proliferation Financing Risk Assessment and Mitigation," June 2021, available at the following website: https://www.fatfgafi.org/media/fatf/documents/reports/Guidance-Proliferation-Financing-Risk-Assessment-Mitigation.pdf , p. 8.
Executive Office for control and Prohibition of Proliferation "Manual guide for Combatting Arms Control for Financial Institutions, Designated Non-Financial Businesses and Professions, and Virtual Asset Service Providers," United Arab Emirates, Ibid, p. 14.
United Nations, (2014), Final Report of the Panel of Experts Established Pursuant to Paragraphs 22-24 of Resolution 1929 (2010).
Anti-Money Laundering and Counter-Terrorism Financing Unit, "Manual guide for Financial Institutions on Combating Arms Proliferation," Arab Republic of Egypt, available at the following website: https://mlcu.org.eg/upload/uploadeditor/files/%D9%82%D9%88%D8%A7%D8 , p. 7, 8.
Anti-Money Laundering and Counter-Terrorism Financing Unit, "Manual guide for Financial Institutions on Combating Arms Proliferation," Arab Republic of Egypt, available at the following website: https://mlcu.org.eg/upload/uploadeditor/files/%D9%82%D9%88%D8%A7%D8
Executive Office for control and Prohibition of Proliferation "Manual guide for Combatting Arms of Financial Institutions, Designated Non-Financial Businesses and Professions, and Virtual Asset Service Providers," United Arab Emirates, ibid
Ibid, p. 15.
It is worth noting that the mutual assessment report on Algeria's compliance with anti-money laundering and counter-terrorism financing measures issued in May 2023 considered that Algeria is not committed to implementing Recommendation 1 of the Financial Action Task Force recommendations, as it considered that the understanding of the risks of money laundering and terrorism financing is not unified. Enforcement authorities and the financial intelligence unit have a good understanding of the risks of money laundering and terrorism financing, while regulatory authorities for financial, business, and non-financial specific professions have poor understanding of these risks. Most of the private sector institutions have an inconsistent understanding of the risks, ranging from weak to medium, without any cooperation between authorities regarding combating the financing of the proliferation of weapons of mass destruction, resulting in a "low" level of effectiveness achieved by Algeria in the first direct result.
Executive Decree No. 20-398 dated December 26, 2023, establishing the National Committee for the Assessment of Risks of Money Laundering, Terrorism Financing and Financing the Proliferation of Weapons of Mass Destruction and defining its duties, organization and operation.
Sadrati Haroun & Sadrati Bahria, "Preventive Administrative Control of Money Laundering Crimes, Terrorism Financing, and Financing the Proliferation of Weapons of Mass Destruction from a Legal Perspective 23-01," Journal of Humanities, Vol. 23, No. 1, 2023, p. 1116.
Despite not having the legal basis for implementing Security Council resolutions aimed at preventing the arming, Algeria has executed a limited number of resolutions related to Security Council Resolution 1718. On the other hand, the intelligence cell has circulated some related resolutions to the institutions subject to the freeze measures. Also, without any legal basis or adopted mechanism, the cell froze the bank accounts of a company listed under the related resolutions related to the ban on financing the proliferation of arms (North Korea). However, the freezing was delayed by four months, indicating that targeted financial sanctions are not being applied without delay, and due to the lack of a legal basis, the Algerian authorities take no steps to identify and seize all relevant assets. Therefore, these sanctions remain merely dead letter.