The JERSEYGOV wants to change the Reliance [OBLIGED PERSON] Framework (another consultation)

The JERSEYGOV want your views on its proposed changes to the Money Laundering (Jersey) Order 2008 (Money Laundering Order) and The Reliance [OBLIGED PERSON] Framework

The  proposals are:

• Allowing firms to rely on a third party if that party is regulated and gives written confirmation
• Allowing reliance on information about the purpose and nature of a business relationship
• Adding clear rules that require firms to manage higher-risk countries with strong group-wide controls
• Extending the definition of 'financial group' to include Designated Non-Financial Businesses and Professions (DNFBPs)
• Updating the Money Laundering Order to match FATF standards better.

Revision of the reliance framework:-

• The proposed reforms are designed to simplify, align, and future-proof Jersey’s reliance framework without compromising AML/CFT effectiveness.

Legislative changes:-

• Article 16 (general reliance) & Article 16A (group reliance):   
• Delete subsections mandating universal periodic testing (16(8) and 16A(7)).
• Revise the immediate cessation provisions at 16(9) and 16A(8).
• Amend the definition of “reliance identification measures” (16(1)) to permit R.10(c) activities carried out by the third party to be relied upon.
• Insert an explicit requirement that, for group reliance involving higher-risk countries, the group’s AML/CFT programme must mitigate that risk in line with R.18.
• Update the "financial group" definition in Article 1(5) to ensure reliance can be placed on/by all categories of FI and DNFBP countenanced by FATF.
• Additional amendments to reflect the revisions required to better align with FATF Recommendations set out in this paper at section 7 above.

Handbook revisions:

• Should the intended amendments to the MLO take effect, the JFSC will develop the Handbook in line with the proposed changes.
• Section 5 – Reliance on obliged persons:
• Replace testing requirements as currently set out in the MLO with Codes of Practice to reflect the revised approach set out in the MLO, supported by guidance and practical examples, with illustrative scenarios for appropriate reliance, inappropriate reliance and group reliance.
• Provide transitional guidance on legacy contracts that still reference prescriptive testing under the MLO.

Transitional 

• The consultation is designed to ensure industry alignment on the broad shape of reforms; it is intended that there would be an appropriate transitional period during which the Government and the JFSC would collaborate on
• Encouraging early alignment of contracts with revised requirements.
• Ensuring clarity on the continuing legal requirement for immediate CDD information, provision of information without delay and written assurance.

The proposed amendments aim to reduce friction in the process and encourage greater usage of the reliance regime to facilitate client onboarding in Jersey.

Reform of Jersey's reliance framework consultation paper

• https://www.gov.je/SiteCollectionDocuments/Industry%20and%20finance/Consultation%20Paper_%20Jersey%20Reliance%20Reform.pdf

Background

• In April 2025, the Government of Jersey launched the Financial Services Competitiveness Programme. This programme aims to strengthen Jersey’s position as an International Finance Centre and support the Island’s financial and professional services sector.
• Workstream 2 (W2) is a key part of the programme. It focuses on practical recommendations to improve Jersey’s regulatory and business environment.
• Between February and May 2025, the Government and the Jersey Financial Services Commission (JFSC) spoke with more than 200 stakeholders across the sector as part of W2. Stakeholders identified the reliance regime as an area for improvement.
• A position paper setting out potential changes to the regime was later shared with trade associations, compliance professionals and senior business leaders. This helped prepare for 3 workshops held in late 2025, during which participants explored potential improvements in greater detail.
• Jersey remains committed to strong standards to:
• Prevent money laundering
• Terrorist financing
• Proliferation financing
• Feedback from the consultation and workshop discussions showed that the mandatory testing requirements in the Money Laundering Order create significant friction and are a major reason why the reliance regime is used less than intended.
• The JERSEYGOV believe there is an opportunity to streamline the client onboarding process, making it easier for firms and their clients.
• The JERSEYGOV welcome your views on the proposed changes.

Source

https://www.gov.je/Government/Consultations/Pages/RelianceFrameworkReform.aspx