Law of 18 September 2017 on Money Laundering: Complete Analysis

In brief

The Belgian Act of 18 September 2017 is the cornerstone of the AML/CFT framework: it requires 32 categories of professionals (banks, notaries, accountants, domiciliation centers…) to identify their clients, assess risks, monitor transactions and report any suspicion to the CTIF/CFI. Penalties range up to 5 million euros in administrative fines and 5 years imprisonment.

Introduction: Belgium's AML Foundation

The Law of September 18, 2017 on money laundering and terrorism financing is Belgium's cornerstone AML/CFT legislation, imposing strict obligations on 32 categories of professionals, including domiciliation centers.

Key figures:

• 137 articles with obligations and sanctions

• €5 million maximum fine

• 5 years imprisonment for serious non-compliance

• Transposition of 4th and 5th EU Directives

Core Obligations for Domiciliation Centers

1. Customer Identification (Art. 19-26)

Standard Customer Due Diligence (CDD):

• ✅ Identify customer + representatives

• ✅ Identify UBOs (ultimate beneficial owners)

• ✅ Understand business relationship purpose

• ✅ Ongoing monitoring

Enhanced Due Diligence (EDD) required for:

• PEPs (Politically Exposed Persons)

• High-risk countries

• High-risk situations

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async function performCDD(client: Client): Promise<CDDReport> {
  class="code-comment">// Verification via Company Belgium
  const kboData = await companyBelgiumClient.companies.get(client.enterpriseNumber);
  const uboData = await companyBelgiumClient.companies.getUBO(client.enterpriseNumber);
  
  class="code-comment">// Sanctions screening
  const sanctions = await screeningService.check(client);
  
  class="code-comment">// Risk assessment
  const riskScore = calculateRiskScore({
    country: kboData.country,
    sector: kboData.naceCode,
    isPEP: sanctions.isPEP,
  });
  
  return {
    compliant: riskScore < 70,
    eddRequired: riskScore >= 60,
  };
}

2. Suspicious Transaction Reporting (Art. 47)

Mandatory CTIF reporting:

• Immediate upon suspicion

• Before execution if possible

• Tipping-off prohibited (informing customer)

3. Record Retention (Art. 34)

Mandatory 10-year retention for:

• Identification documents

• CTIF reports

• Due diligence reports

4. Risk Analysis (Art. 8)

Each obliged entity must establish a risk analysis evaluating customer, product, and distribution channel risks.

5. Staff Training (Art. 16)

Annual training required on:

• Recognizing suspicious operations

• Legal obligations

• Internal procedures

See our AML/KYC training program for domiciliation centers for a structured 8-module program.

6. Compliance Officer (Art. 15)

For entities > 5 employees: dedicated Compliance Officer centralizing CTIF reports and ensuring compliance.

Non-Compliance Sanctions

Administrative sanctions (Art. 91)

• Fines: €50,000 to €5,000,000 (or 10% turnover)

• Activity suspension

• License revocation

See also our guide on AML non-compliance sanctions in Belgium for recent published cases.

Criminal sanctions

• Money laundering: 15 days to 5 years imprisonment

• Failure to report: 6 months to 5 years

• Tipping-off: 6 months to 3 years

Compliance with Company Belgium

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class="code-comment">// Automated compliance verification
async function verifyCDDCompliance(enterpriseNumber: string) {
  const company = await companyBelgiumAPI.companies.get(enterpriseNumber);
  
  const checks = {
    registered: company.status === class="code-string">'ACTIVE',
    addressVerified: company.addresses.length > 0,
    uboIdentified: await hasUBOData(enterpriseNumber),
  };
  
  return {
    compliant: Object.values(checks).every(Boolean),
    recommendations: generateRecommendations(checks),
  };
}

Start your compliance with Company Belgium - 100 free verifications/month.

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Related articles:

• AML/KYC Compliance for Domiciliation Centers

• Obliged Entities: Complete Obligations