Consultation on non-profit organisation handbook requirements (No. 7 2022)

Summary

This is a JFSC consultation paper proposing a new Section 17 (NPO Section) in the Handbook for the Prevention and Detection of Money Laundering and the Countering of Terrorist Financing, aimed at organisations that will be designated as Prescribed Non-Profit Organisations (NPOs) under a forthcoming Ministerial Order. It sets out draft Codes of Practice and guidance covering risk assessment, due diligence on beneficiaries/partners/donors, staff screening and training, accounting for funds, and record-keeping, and invites feedback before the framework is finalised.

• Who it affects: Registered NPOs and Regulated NPOs that fall within the definition of a Prescribed NPO under the forthcoming Prescribed Non-Profit Organisations (Jersey) Order 2022.
• Proposed content: Draft Section 17 covers an introduction, vulnerabilities of Prescribed NPOs to terrorist financing, a risk-based approach (NPO Programme Risk Assessment and ongoing risk monitoring), due diligence on beneficiaries, partners and significant donors, identification/screening/training of employees and volunteers, accounting for funds, and record-keeping.
• Longer-term proposals: The JFSC also proposes requiring Prescribed NPOs to report suspected terrorist financing (TF) and targeted financial sanctions (TFS-TF) matters via a Nominated Reporting Person, with possible criminal offences for failure to report, and removing the current exemption in Article 2(2) of the NPO Law.
• Timing: The Prescribed NPO Order and the revised Handbook are expected to be published around early October 2022, with the new supervisory regime and Handbook requirements anticipated to come into force on 1 January 2023.
• How to respond: Respondents are asked to use the accompanying questionnaire (21 questions covering each proposed section) and send comments either to Jersey Finance Limited or directly to the JFSC.

As a consultation, this document does not itself impose binding requirements; it seeks industry feedback on proposals that, once finalised via the Prescribed NPO Order and revised Handbook, would become binding on Prescribed NPOs.

Key obligations

• Interested parties wishing to comment must submit responses to Jersey Finance Limited or directly to the JFSC no later than 20 September 2022, using the published questionnaire where possible.
• Industry bodies or associations responding should also provide a summary of the type of individuals and/or institutions they represent.

Applies to

Prescribed Non-profit Organisations (NPOs), Registered NPOs, Regulated NPOs

Deadlines

• 20 September 2022: Deadline for submitting consultation responses to Jersey Finance Limited or the JFSC.
• early October 2022: Anticipated publication of consultation feedback and the revised Handbook.
• 1 January 2023: Anticipated coming into force of the Prescribed NPO Order and the new Handbook NPO Section requirements.