1 / 3

The necessity for this agenda item arose due to the sharp increase in donation transactions. The draft aims to submit reports to the Central Bank regarding donations for notaries and the Cadastre Committee in the RA. The first RA Deputy Minister of Justice Ara Mkrtchyan said this while presenting the draft law on Making Amendment and Addendum to the Law on Combating Money Laundering and Terrorist Financing in the first reading for debate on September 11.

He noted that currently, Article 6.4 of the law defines the cases when reports must be submitted to the RA Central Bank regarding a suspicious transaction or business relationship and (or) a transaction subject to mandatory notification. The cases of property donation are not included in the mentioned list.

According to the information of the Deputy Minister, the cases of acquisition of property rights based on donations have increased in recent years. In 2020, 4.017 donation transactions were registered in Yerevan, 8.674 transactions in the regions, in 2021, 5.882 transactions in Yerevan, 12.060 in the regions, in 2022, 7.334 transactions in Yerevan, and 15.765 in the regions.

The constant growth of the donation transactions contains substantial risks that among them there may be fake and spurious transactions in order to hide and legitimize the illegally acquired property from the RA law enforcement bodies by alienating it in a legal way.

At the same time, Paragraph 2 of Article 6.3 of the law contains a provision on cash transactions, which does not comply with the regulations of the Law on Non-Cash Operations, thus it should be removed, leaving the existing general regulations.

The NA Vice President Hakob Arshakyan inquired from the rapporteur how the presented draft will prevent the cases of illegal property donation.

“The presented draft is only one of the means of struggle, but not the only one. What problem will it solve? We will have complete reporting, centralized in one place, and enough data about transactions to identify them if necessary, subject them to appropriate analysis in their entirety, identify potential risks and take measures to manage those risks. In individual cases, when we have alerts on specific transactions regarding any illegality, then, having individual data on the transaction in the reports, we can analyze and present it to the law enforcement bodies. They will already fulfill their duties with their toolkits, operative investigative activity and preliminary investigation method and will reveal any case of illegality,” the Deputy Minister said.

“In other words, a database is being created where all donation data will be stored,” Ara Mkrtchyan added.

The Chair of the NA Standing Committee on Financial-Credit and Budgetary Affairs Gevorg Papoyan presented the endorsement of the Committee.