AML POLICY
definition of country. Under criteria laid out
in the the Montevideo Convention, recognition from other countries was not needed.
Beyond territory, population and government, a state only needed the capacity to
enter into relations with other countries in
order to be considered a country itself.
To put it another way: if it looks like a
country and acts like a country, it is a country
no matter what other countries have to say.
Using the Montevideo definition as a basis
for geographical risk rating makes sense
because it solves the limited-recognition
problem. With a defined territory and popu-
lation, established government and ability to
enter into relations with other countries, the
TRNC would be included. So would several
other limited-recognition countries dotting
the world.
theory it wants to use when a new territory
seeks to become a member of the club of
countries. In reality, many countries select
the more expedient theory to fit their policy
and purposes.
See below for additional unrecognized and
limited-recognition jurisdictions around the
world.
Banks should do the same.
One of the challenges of international relations is that there is no supreme power to
impose common definitions and approaches.
Thus, the Declarative Theory of Montevideo
exists today with the Constitutive Theory of
Vienna — each country free to choose which
Max R. Tappeiner, Global AML advisor,
Royal Bank of Scotland NV., Amsterdam,
Netherlands. [email protected]
The views expressed in this article are those
of its author and do not necessarily represent the views of the Royal Bank of Scotland
Group.
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