Case Study 3.2: Use of crime-specific (money-laundering) statutes: the case of Cyprus

Case Study 3.2: Use of crime-specific (money-laundering) statutes: the case of Cyprus

In Cyprus, although direct enforcement procedures are set forth in anti-money-laundering legislation, these procedures relate to proceeds in general. In turn, proceeds are defined as any economic advantage derived from “illegal activities,” which are all predicate offenses. Thus, the anti-money-laundering statute enables the authorities to directly recognize foreign confiscation orders whether they include or do not include money-laundering offenses.

In particular, according to The Prevention and Suppression of Money Laundering and Terrorist Financing Activities Laws of 2007–2018 (Anti-Money Laundering and Combatting Financial Terrorism (AML/CFT) Law), mutual legal assistance requests in this area are submitted to the Cyprus Ministry of Justice and Public Order Central. That ministry acts as the central authority on the basis of one of the international treaties mentioned in section 37 of the AML/ CFT Law, including the United Nations Convention against Corruption. The central authority transmits the requests to the Unit for Combating Money Laundering (MOKAS, the Cypriot Financial Intelligence Unit) for execution. The lawyers of MOKAS prepare the relevant application for the court for the purpose of obtaining a court order for the registration and enforcement of the foreign confiscation order.

Section 38 of the AML/CFT Law sets out the conditions that must be satisfied for the court to register a foreign order. When a foreign order is registered by the court, it becomes enforceable as if the order had been made by a competent domestic court under the AML/CFT Law.

Section 39 calls for the procedure to be followed after the court registers the foreign order. Specifically, when the confiscation order is registered, it is enforced by MOKAS under the following conditions: (a) if within six weeks from when the persons affected by the order received notification of the registration order, the persons took no action to cancel or to set aside the registration order and (b) if it is not possible to notify, or if the accused or the third person in the possession of the proceeds cannot be located, despite making reasonable efforts.

In the Arab Republic of Egypt,8 India,9 and United Arab Emirates, the legal framework for direct enforcement purposes is contained in anti-money-laundering statutes. In United Arab Emirates, in particular, the anti-money-laundering law provides that “any court injunction or court decision providing for the confiscation of funds, proceeds or instrumentalities relating to money laundering, terrorist financing or financing of illegal organizations may be recognized if issued by a court or judicial authority of another state with which the State has entered into a ratified Convention.”10

The choice to provide direct enforcement exclusively in anti-moneylaundering statutes may raise problems over whether such procedures can be applied by analogy to recognize foreign orders that have been made in criminal proceedings other than those for money-laundering offenses (for example, when foreign proceedings in the requesting jurisdiction relate to corruption offenses and the request for asset recovery does not stem from a money-laundering conviction).

3.1.4 Reliance on general mechanisms for the recognition of foreign judgments

Sometimes the direct enforcement of foreign confiscation orders is made possible through the same provisions broadly applicable to recognizing foreign