Background
On March 26, 2025 final amendments to the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations and creation of a new regulation were officially published in the Canada Gazette (SOR/2025-67 and SOR/2025-68). This round of anticipated changes introduces three company types that will become reporting entities. Additionally, the amendments bring in changes related to reporting of goods, information sharing, and beneficial ownership discrepancy reporting.
In traditional fashion, to make reading these changes a little easier, we (thanks Rodney) have created a redlined version of the regulations, with new content showing as tracked changes, which can be found in a combined document here.
While there are no substantial changes to the requirements from the draft amendments published on November 30, 2025 in the Canada Gazette, one noteworthy change is that the in-force date of most requirements was moved from October 1, 2025, to April 1, 2025, which will likely leave companies scrambling.
The incoming requirements are meant to improve Canada’s anti-money laundering (AML), anti-Terrorist Financing (ATF) and sanctions regime, and implement measures announced in Budget 2022, Budget 2023, Budget 2024, the 2023 Fall Economic Statement, and Canada’s last Parliamentary Review. On February 4, 2025, the Prime Minister issued the Directive on Transnational Crime and Border Security, which stated the urgent need to disrupt profits laundered by organized crime in connection with illegal trade in drugs such as fentanyl. The amendments provided in the finalized regulations were identified as key measures to support this Directive.
The regulatory impact analysis statement (RIAS) accompanying the finalized regulations indicates that these amendments are also needed for Canada to align to Financial Action Task Force (FATF) standards ahead of Canada’s next mutual examination by the FATF later in 2025. The RIAS states that FINTRAC is committed to working with reporting entities to ease the implementation process along this accelerated and exceptional timeline, and will put emphasis on engagement, outreach and guidance activities related to new regulatory obligations.
What’s Changed?
Trade Based Money Laundering (TBML)
The regulatory amendments introduce a new Proceeds of Crime (Money Laundering) and Terrorist Financing Reporting of Goods Regulation.
Under the new regulation, anyone who is importing or exporting goods into or out of Canada needs to file a declaration with the Canada Border Services Agency (CBSA) as follows:
- whether the goods are proceeds of crime as defined by subsection 462.3(1) of the Criminal Code or are goods related to money laundering, to the financing of terrorist activities or to sanctions evasion; and
- that the goods are actually being imported or exported, as the case may be.
The amendments will also include seizure and forfeiture rules. Under the framework, the CBSA will have powers to seize and forfeit goods when they have reasonable grounds to believe that the goods are proceeds of crime or related to money laundering, terrorist financing, or sanctions evasion.
As part of the new requirements, there are substantial record-keeping obligations, including details such as the origin, making, purchase, importation, costs, and value of the goods, as well as records related to payments for the goods.
This change comes into force April 1, 2025.
Information Sharing
The regulatory amendments introduce measures to allow for reporting entities to share information with each other to detect and deter money laundering, terrorist financing, and sanctions evasion, while maintaining privacy protections for personal information.
Reporting entities that wish to share information (it’s voluntary) would be required to establish and implement a code of practice for disclosing, collecting and using personal information without consent. The code must:
- describe the personal information of an individual that may be disclosed, collected or used without their knowledge or consent;
- describe the purposes for which an individual’s personal information may be disclosed, collected or used without their knowledge or consent;
- describe the manner in which an individual’s personal information may be disclosed, collected or used without their knowledge or consent;
- describe the measures to be taken to ensure the protection of personal information, including measures concerning the retention of such information and the keeping of records; and
- include information demonstrating that the code complies with the requirements of the Act.
The Code must be provided to the Office of the Privacy Commissioner of Canada (OPC) for approval, as well as to FINTRAC for comment in advance of use. The OPC must approve the code within 120 calendar days (an increase from the proposed 90 days in the draft amendments). The OPC will continue to have the ability to extend the deadline by an additional 15 days, provided it notifies the reporting entity. Reporting entities would be required to resubmit their Codes to the OPC and FINTRAC every five years regardless of changes or not. The OPC has published guidance on how to submit Codes for review and approval.
This change comes into force immediately.
Discrepancy Reporting
The amendments introduce a requirement for reporting entities dealing with a Canada Business Corporations Act (CBCA) corporation to report any material discrepancies found while obtaining and verifying the accuracy of beneficial ownership information under current AML requirements. The reporting requirement will not apply if the material discrepancy is resolved within 30 days (originally 15 days in the draft amendments) from the date it is identified. Currently, what is deemed to be material is not well defined (outside of missing beneficial owners). There are examples of what is considered not material.
The information with respect to the discrepancy includes:
- Name of reported company and identifying number on its certificate of incorporation, amalgamation or continuance;
- Date on which discrepancy was identified; and
- Description of discrepancy.
This comes into force October 1, 2025.
New Reporting Entities
The regulatory amendments outline the inclusion of three new regulated entities, as announced in Budget 2024, which were highlighted as concerns during Canada’s last FATF mutual evaluation: factoring companies (referred to as “factors”), cheque cashing companies, and financing and leasing companies. These entities will be subject to the PCMLTFA as of April 1, 2025, and must implement compliance programs.
We have created a separate blog post for each of the newly regulated company types (factoring companies, cheque cashing companies, and financing and leasing companies) to make it easier to digest the requirements that apply to each of the new reporting entities.
What Next?
FINTRAC will be issuing and updating guidance related to the changes. While we await guidance, entities should start updating their compliance program and processes to reflect the new requirements as they apply to their business. New reporting entities should start working on developing their compliance program immediately if they have not already done so.
We’re Here To Help
If you would like assistance in understanding what these changes mean to your business, or if you need help in creating or updating your compliance program and processes, please get in touch.