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China’s anti-money laundering (AML) framework has undergone significant changes in recent years. The revised Anti-Money Laundering Law of the People’s Republic of China was adopted on November 8, 2024, and came into force on January 1, 2025. The revised law strengthens risk-based AML controls, expands the legal framework, reinforces customer due diligence and beneficial ownership requirements, and increases the focus on emerging money laundering and terrorist financing risks.
For organizations operating in Mainland China, understanding the China AML regulations, regulatory authorities, reporting obligations, customer due diligence requirements, and beneficial ownership rules is essential for building an effective AML compliance program.
This guide explains China’s anti-money laundering law and regulations, including KYC, customer due diligence (CDD), beneficial ownership, transaction monitoring, suspicious transaction reporting, AML/CFT requirements, and key regulatory developments through 2026.
Scope: This article focuses on Mainland China. Hong Kong and Macao operate separate AML/CFT regulatory frameworks and should not be treated as extensions of the Mainland China AML regime.
What Is China's Anti-Money Laundering Law?
China’s principal AML legislation is the Anti-Money Laundering Law of the People’s Republic of China.
The law establishes the legal foundation for preventing and combating money laundering and terrorist financing and sets responsibilities for financial institutions and other organizations covered by the AML framework.
The revised Anti-Money Laundering Law was approved on November 8, 2024, and took effect on January 1, 2025. The revision represents the first major overhaul of the law since it originally came into force in 2007.
The revised framework places greater emphasis on:
Risk-based AML controls
Customer identification and due diligence
Beneficial ownership
Transaction monitoring and reporting
AML/CFT internal controls
Recordkeeping
Risk assessment of new technologies, products, businesses, and channels
Supervisory cooperation and information sharing
Stronger accountability and penalties for AML violations
The AML framework is supported by regulations, regulatory rules, guidance, and sector-specific requirements issued by the People’s Bank of China (PBC) and other competent authorities.
China's AML Regulatory Framework
China’s AML framework can be understood as a hierarchy of legislation and regulatory requirements.
Level | Key component | Purpose |
|---|---|---|
1 | Anti-Money Laundering Law | Primary AML legislation |
2 | Administrative regulations and State Council measures | Supporting legal requirements |
3 | PBC rules and regulatory measures | Detailed AML/CFT obligations |
4 | Sector-specific regulatory requirements | Requirements for particular financial sectors |
5 | Institutional AML policies and controls | Operational implementation |
The People’s Bank of China (PBC) is the central authority responsible for coordinating and supervising AML work, while sector-specific financial regulators and other government authorities have responsibilities within their respective areas.
China’s AML requirements therefore cannot be understood by looking at the AML Law alone. Compliance teams need to consider the law together with applicable PBC rules, sector-specific requirements, reporting rules, beneficial ownership requirements, and other relevant regulations.
Who Regulates AML in China?
Several authorities contribute to China’s AML regulatory and enforcement framework.
People's Bank of China (PBC)
The People’s Bank of China plays the central role in China’s AML framework.
Its responsibilities include developing AML rules and standards, supervising AML compliance, conducting inspections, coordinating AML work, and receiving and analyzing relevant transaction reports.
The PBC also operates the China Anti-Money Laundering Monitoring and Analysis Center, which functions as China’s financial intelligence function for AML reporting and analysis.
National Financial Regulatory Administration (NFRA)
The National Financial Regulatory Administration (NFRA) supervises banking and insurance institutions within its regulatory remit.
For regulated financial institutions, AML compliance therefore needs to be considered alongside broader prudential and sector-specific regulatory requirements.
China Securities Regulatory Commission (CSRC)
The China Securities Regulatory Commission (CSRC) oversees China’s securities and futures markets and has AML/CFT responsibilities within the sectors under its supervision.
State Administration of Foreign Exchange (SAFE)
The State Administration of Foreign Exchange (SAFE) plays an important role in foreign-exchange and cross-border financial activity.
Organizations involved in international transactions may therefore need to consider AML controls together with applicable foreign-exchange and cross-border requirements.
Other authorities
Public security, judicial, market regulation, and other government authorities can also become involved when AML matters overlap with criminal investigations, corporate registration, beneficial ownership, or other regulatory issues.
Key China AML Compliance Requirements
Organizations subject to China’s AML framework should establish controls proportionate to their risks and business activities.
The core requirements include customer identification, customer due diligence, beneficial ownership identification, transaction monitoring, suspicious transaction reporting, recordkeeping, internal controls, and AML/CFT governance.
China AML Compliance Requirements at a Glance
Requirement | What organizations should do | Primary compliance area |
|---|---|---|
KYC | Identify and verify customers | Customer onboarding |
CDD | Assess customer and relationship risk | Ongoing relationship |
Beneficial ownership | Identify ultimate owners/controllers | Entity customers |
Transaction monitoring | Detect unusual or suspicious activity | Ongoing monitoring |
STR | Report qualifying suspicious activity | Regulatory reporting |
Recordkeeping | Maintain required customer and transaction records | Audit and supervision |
CFT | Identify and manage terrorist financing risks | AML/CFT |
Internal controls | Establish governance, procedures, and accountability | AML program |
KYC and Customer Identification
Know Your Customer (KYC) is a fundamental component of China’s AML compliance requirements.
Organizations subject to AML obligations need processes for identifying customers and verifying relevant information before and during a business relationship, as applicable to their regulatory obligations and risk profile.
KYC controls can include:
Customer identity verification
Verification of corporate information
Collection of required identification documents
Assessment of customer information
Identification of beneficial owners
Screening against applicable risk and regulatory lists
Enhanced verification for higher-risk customers
Periodic review and updating of customer information
Digital and remote onboarding processes should also incorporate appropriate identity verification and risk controls.
For financial institutions, the PBC’s customer due diligence framework requires institutions to use reliable and independent information when verifying customer identity and to apply enhanced measures where risk warrants them.
Customer Due Diligence (CDD)
Customer Due Diligence (CDD) goes beyond collecting identification documents.
An effective CDD process should help an organization understand:
Who the customer is
Who ultimately owns or controls the customer
The customer’s business or source of funds
The purpose and expected nature of the relationship
The customer’s AML/CFT risk profile
Whether the customer’s activity remains consistent with the expected profile
China’s framework follows a risk-based approach. Higher-risk relationships may require enhanced due diligence and additional information.
Potential higher-risk factors can include:
Politically exposed persons (PEPs)
Complex ownership structures
Unusual or opaque corporate arrangements
Higher-risk jurisdictions
Complex cross-border activity
Unusual transaction patterns
Products or services presenting elevated AML/CFT risks
CDD should not be treated as a one-time onboarding exercise. Customer information and risk assessments should be reviewed as the relationship develops and when relevant risk factors change.
Beneficial Ownership Requirements in China
Beneficial ownership has become a particularly important part of China’s AML framework.
In 2024, the PBC and State Administration for Market Regulation (SAMR) jointly issued the Measures for the Administration of Beneficial Ownership Information, which established a beneficial ownership information filing system. The measures took effect on November 1, 2024.
Under the measures, covered entities include:
Companies
Partnerships
Branches of foreign companies
Other entities specified by the competent authorities
A beneficial owner generally refers to a natural person who ultimately owns, controls, or receives the ultimate benefits from the relevant entity.
The measures identify criteria including:
Direct or indirect ownership of 25% or more
Entitlement to 25% or more of relevant income or voting rights
Actual control over the entity
The rules also establish circumstances in which certain qualifying small entities can use a simplified commitment-based exemption from filing.
For entities already registered before November 1, 2024, the prescribed transition deadline for filing beneficial ownership information was November 1, 2025. New covered entities are subject to filing requirements linked to their establishment registration.
For AML compliance teams, beneficial ownership information should be considered alongside customer-provided information and other reliable sources. Inconsistencies between corporate ownership records and information obtained during CDD can be an important risk indicator.
Transaction Monitoring in China
Transaction monitoring is a central element of China’s AML compliance framework.
Financial institutions are required to establish transaction monitoring standards that take account of factors such as:
Customer identity and behavior
Transaction amount
Frequency
Direction and flow of funds
Transaction purpose and nature
Customer profile
Business characteristics
Geographic exposure
Institutional AML risk assessments
PBC rules require financial institutions to develop and periodically evaluate their transaction monitoring standards. Transactions identified through monitoring should be analyzed and appropriately documented, including the rationale for excluding an alert from suspicious transaction reporting.
Modern transaction monitoring programs can combine:
Rules-based monitoring
Risk-based thresholds
Customer risk profiles
Behavioral analytics
Scenario-based detection
Network and relationship analysis
Automated alert generation
Analyst investigation workflows
The objective is not simply to generate alerts. Institutions need processes to investigate alerts, document decisions, identify genuinely suspicious activity, and report where required.
Recordkeeping Requirements
Recordkeeping is another important component of China AML compliance.
Financial institutions are required to retain customer and transaction information in accordance with applicable regulatory requirements.
Historical PBC rules, for example, require account information and transaction records to be retained for specified minimum periods. Current requirements should always be checked against the rules applicable to the relevant institution and activity.
A robust recordkeeping framework should support:
Customer identification records
CDD information
Beneficial ownership information
Transaction records
Risk assessments
Monitoring alerts
Investigation records
Suspicious transaction decisions
Regulatory reports
Internal AML reviews and audits
Records should be sufficiently complete to allow the organization and regulators to reconstruct relevant customer and transaction activity.
Suspicious and Large-Value Transaction Reporting in China
China’s AML framework requires financial institutions to report qualifying large-value and suspicious transactions.
The China Anti-Money Laundering Monitoring and Analysis Center receives relevant reports from financial institutions under the applicable reporting framework. PBC rules require financial institutions to establish transaction monitoring standards and report suspicious transactions when the relevant legal conditions are met.
Importantly, suspicious transaction reporting is not determined solely by transaction value.
A transaction can be reportable because of circumstances indicating potential money laundering or terrorist financing even where the amount itself is not unusually large.
Institutions should therefore maintain processes for:
Detecting potentially unusual transactions
Reviewing alerts
Conducting appropriate analysis
Documenting the investigation
Determining whether a suspicious transaction report is required
Submitting the report through the prescribed channels
Maintaining supporting records
PBC rules also require institutions to maintain transaction monitoring standards and periodically assess their effectiveness.
Mandatory filings are required for any large-value transfer within 5 working days of the transaction:
Cash Transactions: Any cash deposit, withdrawal, or exchange exceeding RMB 50,000 (or USD 10,000 equivalent) per day.
Cross-Border Transfers (Individuals): Any cross-border electronic transfer exceeding RMB 200,000 (or USD 10,000 equivalent).
Domestic Transfers (Institutions): Any domestic electronic transaction between legal entities exceeding RMB 2 million (or USD 200,000 equivalent).
Precious Metals/Gemstone Dealers: Under updated rules, cash transactions of RMB 100,000 or more must be reported
Important: Reporting timelines and thresholds can vary according to the applicable rules and may change as regulations are amended. Compliance teams should therefore verify the current PBC requirements rather than relying on a generic reporting deadline.
China AML/CFT and Targeted Financial Measures
China’s AML framework also incorporates measures addressing terrorist financing (CFT).
AML and CFT controls overlap in several areas, including:
Customer due diligence
Transaction monitoring
Risk assessment
Screening
Suspicious transaction reporting
Recordkeeping
Internal controls
Financial institutions may also need to identify and respond to applicable terrorist financing risks and relevant lists or measures under Chinese law.
Organizations with cross-border operations should distinguish between:
Chinese AML/CFT requirements
United Nations measures
Home-jurisdiction requirements
Group-level sanctions policies
Other applicable foreign regulatory obligations
These regimes can overlap, but they are not automatically interchangeable.
For multinational organizations, sanctions and AML screening should therefore be designed around the legal requirements applicable to each business, customer, transaction, and jurisdiction.
China AML Regulations: Key Developments from 2024 to 2026
China’s AML regulatory environment has developed rapidly.
Year | Development | Compliance significance |
|---|---|---|
2024 | Revised Anti-Money Laundering Law adopted | Major modernization of China's AML legal framework |
2024 | Beneficial Ownership Information Management Measures issued | Formalized beneficial ownership information filing |
2024 | Beneficial ownership measures took effect on November 1 | New filing framework became operational |
2025 | Revised AML Law took effect on January 1 | Updated AML obligations and enforcement framework |
2025 | Existing entities subject to beneficial ownership transition requirements | Covered entities had to complete required filings |
2025–2026 | PBC continued updating AML-related rules | Financial institutions need to track implementing requirements |
2026 | Greater focus on operational implementation | Data quality, risk management, technology, and supervisory expectations remain important |
The PBC also amended AML-related rules in 2025. Changes to the Measures for the Reporting of Large-Value and Suspicious Transactions and the Measures for the Supervision and Administration of Anti-Money Laundering and Counter-Terrorist Financing by Financial Institutions took effect on December 1, 2025. These amendments included non-bank payment institutions within the specified reporting framework and made other adjustments to align regulatory rules with the revised AML Law.
This makes regulatory monitoring particularly important for organizations operating in China’s financial sector.
Which Industries Are Covered by China's AML Framework?
China’s AML requirements have historically focused strongly on financial institutions, including:
Banks
Securities companies
Futures companies
Fund management companies
Insurance companies
Trust companies
Finance companies
Financial leasing companies
Consumer finance companies
Other covered financial institutions
Non-bank payment institutions
The revised AML Law also strengthens the framework concerning specified non-financial institutions and professional sectors.
Depending on the applicable legislation and implementing rules, relevant sectors can include areas such as:
Real estate
Accounting
Legal services
Notarial services
Precious metals and gemstones
The exact obligations should be assessed based on the entity, activities, and applicable implementing requirements rather than assuming that every organization in a broad professional category has identical AML obligations.
China AML Compliance Checklist
Organizations operating in China can use the following checklist as a starting point for assessing their AML framework:
Governance
Establish clear AML/CFT responsibilities
Maintain appropriate policies and procedures
Assign qualified AML personnel
Conduct regular risk assessments
Customer Risk Management
Implement KYC controls
Perform customer due diligence
Identify beneficial owners
Apply enhanced due diligence where required
Manage PEP and higher-risk relationships
Transaction Monitoring
Establish risk-based monitoring scenarios
Monitor customer and transaction behavior
Investigate alerts
Document investigation outcomes
Periodically assess monitoring effectiveness
Regulatory Reporting
Identify reportable suspicious transactions
Maintain large-value transaction reporting processes where applicable
Submit reports through prescribed channels
Maintain supporting documentation
Data and Records
Maintain customer records
Maintain transaction records
Keep CDD and beneficial ownership information current
Protect sensitive customer information
Ongoing Compliance
Monitor regulatory changes
Test AML controls
Conduct training
Perform independent reviews or audits where required
Update risk assessments periodically
AML Compliance Challenges and Technology Solutions
China’s evolving AML framework creates operational challenges for compliance teams.
Organizations increasingly need to manage large volumes of customer information, beneficial ownership data, transaction activity, regulatory lists, adverse information, and alerts while maintaining consistent documentation.
Technology can help compliance teams improve the efficiency and consistency of these processes with The Complete AML System and, if you want, fraud + AML (FRAML), The Complete FRAML System.
KYC and AML Screening
PreScreening.io can support customer and entity name screening workflows by bringing together KYC, AML, watchlist, adverse media, and background screening processes.
This can help organizations identify potential risks during customer onboarding and ongoing reviews.
Transaction Monitoring
Transact Comply supports transaction monitoring and payment screening workflows through configurable rules, risk-based thresholds, customer risk assessment, and automated reporting capabilities.
For institutions managing high transaction volumes, automated monitoring can help standardize alert generation and investigation workflows.
Due Diligence and Beneficial Ownership
Due Diliger can support enhanced due diligence and investigative workflows by helping compliance teams assess entities and individuals across multiple risk dimensions.
For complex ownership structures, beneficial ownership analysis can be combined with corporate, regulatory, adverse media, and other due diligence information.
Technology does not replace an organization’s legal or regulatory responsibilities. Instead, it can help compliance teams operationalize regulatory requirements, improve data quality, standardize workflows, and maintain better audit trails.
FAQs About China AML Regulations
What is China's Anti-Money Laundering Law?
China’s Anti-Money Laundering Law is the primary legislation governing the prevention and control of money laundering in Mainland China. The revised law was adopted in November 2024 and took effect on January 1, 2025.
What are the main China AML regulations?
China’s AML framework includes the Anti-Money Laundering Law, PBC rules, administrative regulations, sector-specific requirements, beneficial ownership rules, transaction reporting requirements, and other regulatory measures.
Who regulates AML in China?
The People’s Bank of China plays the central AML regulatory role. Other authorities, including the NFRA, CSRC, SAFE, market regulation authorities, and law enforcement bodies, have responsibilities within their respective areas.
What are China's KYC and CDD requirements?
KYC and CDD requirements generally require covered institutions to identify and verify customers, understand the nature and purpose of relationships, identify beneficial owners, assess risk, and apply enhanced measures where appropriate.
What are China's beneficial ownership requirements?
China’s beneficial ownership framework requires covered entities to file information about their beneficial owners. The 2024 Measures for the Administration of Beneficial Ownership Information established criteria based on ownership, income or voting rights, and actual control.
Does China require suspicious transaction reporting?
Yes. Covered financial institutions must report qualifying suspicious transactions under the applicable PBC reporting framework. They must also maintain appropriate transaction monitoring standards and supporting analysis.
What changed under China's AML Law in 2025?
The revised Anti-Money Laundering Law took effect on January 1, 2025. It strengthened the legal framework around AML obligations, supervision, risk-based controls, accountability, and emerging money laundering risks.
What should organizations focus on for China AML compliance in 2026?
Organizations should focus on implementing the revised AML Law and related regulatory requirements, maintaining accurate customer and beneficial ownership information, strengthening transaction monitoring, managing AML/CFT risks, and keeping their compliance frameworks aligned with regulatory updates.
Does Hong Kong follow China's Mainland AML regulations?
No. Hong Kong has its own AML/CFT regulatory framework. Macao also operates under a separate AML/CFT regime. Organizations with operations across Mainland China, Hong Kong, and Macao should assess the requirements applicable in each jurisdiction separately.
Conclusion
China’s AML framework is moving toward a more comprehensive, risk-based, and technology-enabled compliance model.
For organizations operating in Mainland China, the major areas of focus include:
Understanding the revised Anti-Money Laundering Law, which took effect on January 1, 2025.
Strengthening KYC and customer due diligence, particularly for higher-risk relationships.
Maintaining accurate beneficial ownership information and incorporating it into customer risk assessments.
Improving transaction monitoring and suspicious transaction reporting processes.
Keeping AML/CFT policies, technology, data, and internal controls aligned with regulatory developments.
China AML compliance is therefore not simply a matter of meeting onboarding requirements. Organizations need an ongoing framework that connects customer information, beneficial ownership, risk assessment, transaction monitoring, investigation, reporting, and regulatory change management.
For compliance teams, combining strong governance with reliable data and appropriate technology can help make AML controls more consistent, scalable, and responsive to changing risks.
ZIGRAM’s Risk App Ecosystem (AML+Fraud) solutions, including PreScreening.io, Transact Comply, Entity Hero, Fraud Fighter, and Due Diliger, can support different stages of this compliance lifecycle, from KYC and screening to transaction monitoring and enhanced due diligence.
