MONACO: An Introduction to Private Wealth Law (Monaco Law Firms)

The Principality of Monaco is attracting more and more foreign residents drawn by its many tax advantages, its geographical location, its level of security, the quality of its education system and the stability of its political system. The Principality’s constantly evolving and growing economy is also a factor in its attractiveness.

Monaco has also undergone numerous reforms in order to modernise its legal system, in particular in the fields of business law, anti-money laundering, data protection, intellectual property, private international law and trusts. It has succeeded in its ambition to be a modern country, open to the world and environment conscious.

Some of the key legislative and regulatory projects currently being pursued by Monaco are set out below.

The Fight Against Money Laundering  

For many years, the Principality has pursued an active policy in the fight against money laundering and terrorist financing. In 2023 alone, four laws were passed to amend the existing provisions.

Monaco has adopted an anti-money laundering legal framework in line with the international standards recommended by the Groupe d’action financière (GAFI). To this end, since the first anti-money laundering law was passed in 1993, Monaco’s legal and regulatory framework has been regularly amended and, on several occasions, strengthened to take best practices into account. The legal framework is now based on law No 1.362 of 3 August 2009, which completely overhauled the provisions that were previously scattered across a number of different pieces of legislation and updated the standards in line with the GAFI recommendations.

To oversee the implementation of these measures, the Principality has set up the Service d’Information et de Contrôle sur les Circuits Financiers (SICCFIN). With its extensive investigative powers, SICCFIN has a dual mission:

– to analyse and process suspicious transaction reports filed by economic actors subject to the provisions of Act 1.362 and its implementing regulations; and 

– to check that these economic actors are complying with their legal obligations, by carrying out on-site visits.

Since joining the Council of Europe in 2004, Monaco has regularly participated in the work of the MONEYVAL Committee of Experts. The purpose of this Committee is to ensure that member states have put in place an effective system to counter money laundering and the financing of terrorism, and that they comply with the relevant international standards in this area.

Through its legislative reforms and international commitments, the Monegasque government’s anti-money laundering action is contributing to the development and modernisation of its banking and financial sector. Monaco thus intends to guarantee monetary and financial transactions a level of legal security in line with the standards of a modern and attractive banking centre.

At the request of Moneyval and the GAFI, new measures are in the process of being implemented.

Data Protection  

Bill No 1054, dated 20 December 2021, is intended to replace Law No 1.165 of 23 December 1993, on the protection of personal data. The goal is to integrate into domestic law the new international standards resulting from Convention 108+ of the Council of Europe and the GDPR. This bill is also inspired by the principles resulting from Directive (EU) 2016/680.

The bill is divided into ten Chapters and contains 114 Articles (instead of the 26 Articles present in the current law), in addition to the accompanying explanatory statement. Its main contributions are the disappearance of a certain number of prior formalities applicable to data controllers, the introduction of the office of Data Protection Officer, and new obligations such as the realisation of impact analysis, or the keeping of a directory of processing. Another novelty concerns the strengthening of the sanctioning powers of the future Personal Data Protection Authority (PDPA), which will replace the current Commission de Contrôle des Informations Nominatives (CCIN).

At this stage, a rapporteur has been appointed within the National Council (Parliament) in order to analyse the bill, and to present to the assembly, possible amendment proposals in view of a vote. There is no foreseeable date of entry into force of the new law in Monaco.

Intellectual Property  

The protection of literary and artistic works is currently the subject of an in-depth legislative reform. A bill is currently being discussed in Parliament in order to harmonise the Monegasque copyright regime as much as possible with the one in force in neighbouring countries, and to establish a legal regime for intellectual property issues left unresolved by the current legislative and regulatory framework.

Recently, the regime and the amount of the resale right have been reformed in the light of the provisions of Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art.