China — Country Risk Report

China (Asia Pacific • East Asia). Risk report as of the 19 Jun 2026 FATF plenary.

High country risk, with governance and transparency concerns. China's country risk score is 6.0/10, placing it in the high-risk band. The principal driver is weak voice and accountability, alongside corruption risk. China is not currently FATF grey- or black-listed. China is not subject to comprehensive country-wide sanctions. Firms should apply additional scrutiny where exposure involves state-linked entities, restricted sectors, sensitive technology, dual-use goods or politically exposed counterparties.

Recommended treatment

Enhanced due diligence.

At a glance

• FATF status: Not currently listed (one indicator only; it does not set the overall country risk rating by itself)
• Comprehensive country sanctions: none identified. Targeted sanctions exposure: programmes in place, screen applicable lists
• Government effectiveness and rule of law: 4.8/10
• Corruption (CPI 2025): 43/100, rank #76 of 182
• Enforcement data: not yet assessed (no RegActions coverage)

Country Risk Score: 6.0/10 (High)

Higher score means higher country risk (global average 4.6). Full information available. Some evidence is older. Enforcement activity and CPI are shown for context but do not change the score.

All three parts of the score are available.

How this score was calculated

• Financial crime controls: 6.0/10 — 50% of this score
• Government effectiveness and rule of law: 4.8/10 — 30% of this score
• International sanctions: 5.9/10 — 20% of this score
• The FATF assessment is more than five years old.
• sector-wide international sanctions means the score cannot be lower than 6.0. This minimum set the final score.

Principal risk drivers

• Sectoral sanctions exposure
• Voice & accountability — 7.2/10
• Corruption (WGI) — 5.0/10

Mitigating factors

• Not currently on the FATF grey or black list.
• No comprehensive country-wide sanctions programme.
• Comparatively stronger political stability (3.7/10).
• Risk is concentrated in specific counterparties, sectors and transactions rather than applying uniformly.

Business impact

• Customer onboarding (High): Additional ownership and control verification may be required.
• Payments and transactions (High): Review transaction purpose, counterparties and geographic routing.
• Trade and export activity (High): Screen goods, end users and potential dual-use exposure.
• Corporate clients (High): Assess state ownership, government links and political exposure.
• Ongoing monitoring (High): Apply alerts for ownership changes, sanctions and geopolitical developments.

Recommended controls

• Verify ultimate beneficial ownership using more than one reliable source.
• Identify state ownership, government influence and politically exposed persons.
• Screen entities, directors and beneficial owners against applicable sanctions lists.
• Apply enhanced review to technology, defence, telecommunications, financial services and dual-use activity.
• Document transaction purpose and source of funds where cross-border structures are complex.
• Escalate unresolved ownership opacity or adverse information to Compliance.

Enhanced due diligence triggers

• State ownership / control
• PEP involvement
• Sensitive / restricted sectors
• Opaque ownership
• Adverse media
• Dual-use goods & technology
• High-risk intermediary routing

FATF status: Not currently listed

China is not on the FATF grey or black list as of the 19 Jun 2026 plenary.

Sanctions: Sectoral

• EU — sectoral: Specific restrictive measures in relation to the events at the Tiananmen Square protests of 1989 (source)
• OFAC — targeted: Chinese Military Companies Sanctions (source)
• UK — sectoral: UK arms embargo on mainland China and Hong Kong (source)

Source details

International sanctions by issuing body

• UN: No
• EU: Yes (Sectoral)
• UK: Yes (Sectoral)
• US: Yes (Targeted)

No means the complete UN, UK, EU and US review found no direct country-level programme. People or organisations may still appear on sanctions lists.

Government effectiveness and rule of law (World Bank 2024, percentile)

• Government Effectiveness: 69/100
• Regulatory Quality: 54/100
• Rule of Law: 47/100

Regulators and legal framework

FATF network

FATF member.

• Asia/Pacific Group on Money Laundering
• Eurasian Group on Combating Money Laundering and Financing of Terrorism

Last mutual evaluation: 2019 · report

National regulators

Regulator profiles not yet available on RegActions.

FIU: Not an Egmont Group member

Framework signals

• FATF listing: Not currently listed
• International sanctions: sectoral exposure
• BO register: Restricted (live since 2024)
• Corruption (CPI 2025): 43/100, rank #76 of 182
• Rule of law (WGI): 4.3/10 risk

Sector exposure

• Banking & payments (Low): No FATF listing, rule-of-law governance within normal range
• Trade & export controls (High): Sectoral sanctions: Specific restrictive measures in relation to the events at the Tiananmen Square protests of 1989
• Crypto & virtual assets (Elevated): Weak accountability governance (WGI 7.2/10 risk)
• Real estate & luxury assets (Low): Corruption indicators within normal range for high-value assets
• State-linked & procurement (Low): Political-stability and corruption governance within normal range

Derived from sanctions tier, FATF listing, World Bank WGI governance and CPI; no per-sector dataset is asserted.

China: analysis

China's profile is driven by a broadly mixed governance picture. Voice and accountability (severe) is the most significant weakness, while political stability (moderate) and rule of law (moderate) sit at moderate levels. Corruption (elevated) is a meaningful risk factor, supported by a CPI reading. No FATF listing or sanctions apply, so the profile reflects governance foundations only. China sits near the global midpoint on the World Bank governance indicators.

Outlook

The governance trajectory is unlikely to improve materially in the near term given structural constraints on accountability. Geopolitical developments and evolving trade and financial regulations may affect the risk environment. Firms should monitor for any sanctions-related policy changes by major imposing jurisdictions, as geopolitical dynamics create non-trivial tail risk, and should maintain proportionate due diligence given the corruption and transparency profile.

Key watchpoints

• Monitor geopolitical developments that could trigger sanctions designations by OFAC, the EU, or UK authorities.
• Track domestic anti-corruption campaign outcomes and their effect on state-linked counterparties.
• Assess beneficial ownership transparency for structures involving state-owned enterprises and politically exposed persons.
• Review sector-specific exposure in technology, financial services, and dual-use goods given evolving export-control and screening requirements.

Assessment currency

• FATF status: Not listed (as of 19 Jun 2026)
• Sanctions exposure: Targeted programmes in place (as of Jul 2026)
• Governance (WGI): Latest dataset incorporated (as of 2024)
• Corruption (CPI): 43/100 (as of 2025)
• RegActions assessment: Reviewed (as of 19 Jun 2026)

Public evidence layer

FATF action: none. No FATF call-for-action or increased-monitoring status was identified at the latest plenary. This does not establish low risk.

Contextual signals (not scored)

• FATF network membership: Direct FATF member (present, as of 2026-07)
• EU non-cooperative tax jurisdictions: Not listed in Annex I (absent, as of 2026-02-17)
• Egmont Group FIU: No Egmont member FIU identified (absent, as of 2026-07-17)
• Beneficial-ownership register: Restricted (live since 2024) (present, as of 2026-07-17)
• Transparency International CPI: 43/100, rank 76 (present, as of 2025)

Evidence freshness

• FATF monitored-jurisdiction status: current; data 2026-06-19
• FATF mutual evaluation and follow-up ratings: current; data 2026-07-31; follow-up 2022-11; base assessment 2019-04
• World Bank governance indicators: current; data 2024
• UN, UK, EU and US sanctions regimes: current; data 2026-08-16

Contextual signals are public evidence only and do not change the immutable v2 score.

Download evidence PDF · CSV · JSON

Regional peer scores

• Myanmar: 9.0/10 (Very high)
• North Korea: 9.0/10 (Very high)
• Afghanistan: 7.0/10 (Very high)
• Hong Kong: 6.0/10 (High)
• Laos: 6.0/10 (High)
• Nepal: 6.0/10 (High)

Source: FATF black & grey lists · World Bank WGI (CC BY 4.0 — World Bank WGI) · TI CPI (CC BY-ND 4.0 — Transparency International, display only)