Kathmandu. The government has initiated efforts for policy reforms after the international organization included Nepal in the ‘grey list’ for not being serious about prevention of money laundering.
Since the cover of real estate transactions has been used to legalize the money earned from illegal sources, the source of money for both those buying and selling land will be sought from now on. With the promulgation of the new provisions, those active in the business of legalizing the property acquired through bribery, corruption, tax evasion, etc. in the guise of real estate transactions have become frightened.
In the Directive 2082 issued by the Department of Land Management and Records on Tuesday regarding the prevention of money laundering and financing of terrorist activities, both the parties involved in the purchase and sale have to include the transaction details (bank statement) of the bank account.
As per the provisions of the directive, payments above Rs 1 million and up to Rs 5 million will have to be made through banking system or electronic payment system. Similarly, when buying and selling more than Rs 5 million, the ‘Good for Payment’ (eligible for payment) cheque prepared in the name of the seller will have to be done directly through the electronic payment system and through cheque.
If there is a ban of more than Rs 1 million, then the details of the transaction made through the electronic system from the buyer’s bank account to the seller’s bank account will have to be submitted along with the documents of the banabatta certified by the local level.
The Financial Action Task Service (FATF) has listed the government’s help in property purification. Nepal has been given a two-year deadline to escape from this list. Under the action plan prepared by the government to get out of the bad list, real estate transactions are also going to be involved.
Rules not applicable to gold and silver transactions:
The government has imposed a provision to disclose the source of gold for the purchase and sale of precious metals including gold and silver. To circumvent this provision, this rule is limited to paper, it has not been implemented in practice after the trader taught him to evade the limit of Rs 1 million by preparing details of buying and selling gold in the name of different members of the same family or different members of the family including bride, niece, sister-in-law.
According to the 62nd annual report of the Auditor General, 96.32 per cent of the transactions from gold and silver shops in New Road were done in cash or outside the banking channel.
