The directive also provides for updating the customer identification system and biometric details of casino players as prescribed and providing them to this department upon request, and for recording all activities at the casino premises and keeping their records safe for at least 6 months.
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Now casinos will have to keep records of customers who spend more than Rs 200,000 per day. The Department of Tourism has made this provision by amending point 10 of the directive issued to casino entrepreneurs (indicator institutions) regarding the prevention of money laundering and terrorist financing, 2082.
The amendment states that details of such customers should be kept after clause (a) of sub-section (1) ‘when a customer transacts more than two hundred thousand rupees in cash in a day’.
The department had earlier issued a directive directing casinos to implement it effectively. The provision mentioned now has been added to the same directive. As per the previous directive, casino companies will have to follow the provisions mentioned in the Money Laundering Prevention Act, 2064, the Tourism Act, 2035, and the Casino Regulations, 2082.
Foreign currency transactions should not be carried out without obtaining a license for foreign currency transactions from Nepal Rastra Bank and details as per the Casino Regulations, 2052 and the Directive 2082 (including the first amendment) issued by the Department of Tourism to Casino Entrepreneurs (Notified Organizations) on Prevention of Money Laundering and Financing of Terrorism must be submitted to the department regularly. The directive also provides for updating the customer identification system and biometric details of casino players as prescribed and providing them when requested by this department, and recording all activities at the casino premises and keeping their records safe for at least 6 months.
Casinos will not be allowed to be operated by subcontracting or by any other means. The company will be completely prohibited from operating casinos in any place other than the place permitted by the regulatory body, and the directive also provides for deducting the incidental profit tax in advance from the amount won by any player as per the prevailing law before paying the amount won by such player on the same day.
After deducting the incidental profit tax, the licensed company should issue a certificate of deduction of incidental profit tax to the player and send its details immediately to the concerned Inland Revenue Office and inform the Tourism Department. The directive also provides for prohibiting playing any games based on the internet or online, ensuring adequate security inside and outside the casino and hotel premises, and fully complying with the instructions of local security bodies as per the law.
Nepal has also made provision in the directive for immediate action in accordance with the law if the casino is not found to be in compliance with the risk-based casino monitoring act 2082. The department has issued the directive in accordance with the action plan put forward by the government to exit the negative list after the Financial Action Task Force (FATF), an international organization that monitors money laundering and terrorist activities, placed it on the 'Grey List'. Although the department had already issued the directive, it has now been further strengthened through amendments.
After Nepal was placed on the list, it has drawn up a two-year action plan to exit the negative list as per the FATF's suggestion. The action plan states that the conditions set by the FATF will be followed within two years. As per the action plan, the financial sector and financial transaction regulatory organizations including the Rastra Bank, Insurance Committee, Nepal Securities Board, Cooperatives Department, Tourism Department are issuing directives related to money laundering.
Based on the conclusion that the previous directives were insufficient, those bodies have not revised the existing directives and issued new ones. The Financial Sector High-Level Coordination Committee had decided in February that all regulators should issue guidance in this regard.
