Verification knowledge hub
How to onboard French users in a compliant way.
France has transposed the principles of the Fifth AML Directive into its Financial and Monetary Code, giving French businesses more flexibility when onboarding users online. The changes were ushered in by Decree № 2020-118 issued February 12th, 2020 and Decree № 2021-387 issued April 2, 2021.
According to the decrees, remote verification is now considered as secure as face-to-face verification. Also, the list of AML compliant verification providers has expanded to include services certified by the National Cybersecurity Agency of France (ANSSI).
Let’s dive deeper into the updated identification and verification requirements in France.
The changes impact French businesses obligated to follow French AML regulations and report to the Financial Markets Authority (AMF) and the Prudential Supervision and Resolution Authority (ACPR), France’s national financial regulators. This includes a wide range of entities:
The new rules also apply to foreign firms onboarding French clients if they are established in the EU/EEA and operate in France through a branch or an agent.
The new measures are in line with the principles of the Fifth AML Directive, which champions the use of remote verification by businesses. The amendments to the French Monetary and Financial Code simplify requirements for remote verification and expand the list of qualified providers.
Firms must identify the purpose and the nature of the business relationship they are establishing with a client.
If the client is a natural person, firms must obtain their first and last name, as well as their date and place of birth.
If the client is a legal entity, firms must obtain its legal form, name, registration number, head office address and the place of actual activity if it differs from the legal address. It is also required to identify the beneficial owner of the legal entity. This can be done by collecting the same information required from natural persons.
The beneficial owner is a person who directly or indirectly owns more than 25% of a company’s capital/voting rights or otherwise exercises ultimate control over it.
To get onboarded online, natural persons must provide one of the following official documents:
The copy of the document must be valid and bear the owner’s photo. From February, 2020, clients no longer need to provide a second supporting document to confirm their identity.
In order to onboard legal entities, a firm can obtain any act or extract from the official register (for example, K-bis) not older than three months or an extract from the official Journal.
Businesses can choose from three sole verification solutions approved by French regulators:
If the first three solutions are not available, businesses can use a combination of at least two of the following measures:
The adopted measures make remote verification more available for businesses while enabling them to check French users faster and easier—all without neglecting security and compliance.
To onboard more customers, increase revenue, and comply with regulations, try Sumsub’s efficient remote verification solution. Request a demo today.