AML/CFT Compliance Relief: What New Zealand Businesses Need to Know in 2025

Shaun Cooke
Feb 13
3 min read

Updated: Mar 13

New Zealand’s Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) regime is undergoing significant reform to reduce compliance costs, improve risk-based supervision, and align with global best practices. The government’s AML/CFT legislative reform programme is structured into three key workstreams, with Workstream 1 delivering immediate regulatory relief for businesses facing rigid compliance requirements.

These reforms will reshape AML compliance for financial institutions, lawyers, real estate agents, accountants, and other reporting entities, ensuring that AML/CFT obligations remain effective while minimising unnecessary regulatory burdens.

Overview of the Three AML/CFT Workstreams

Workstream 1 – Immediate Regulatory Relief (2025 Implementation)

Removes unnecessary verification requirements for low-risk customers.
Extends Suspicious Activity Report (SAR) and Prescribed Transaction Report (PTR) timeframes.
Reduces Enhanced Customer Due Diligence (EDD) obligations for low-risk trusts.

Workstream 2 – Restructuring AML/CFT Supervision and Funding (Expected 2025-2026)

Consolidates the three AML/CFT regulators (DIA, RBNZ, and FMA) into a single supervisory authority.
Introduces a new AML compliance levy, shifting costs from the government to businesses.

Workstream 3 – Strengthening AML Regulations and Sanctions Compliance (2026 Onward)

Expands the AML/CFT framework to include proliferation financing and targeted financial sanctions.
Creates a closed beneficial ownership trust register to enhance transparency.
Reforms penalties and compliance expectations for AML reporting entities.

While all three workstreams are critical, Workstream 1 is the most urgent and impactful, particularly for lawyers, accountants, trust service providers, and real estate agents.

Workstream 1: Key AML/CFT Compliance Changes for 2025

Workstream 1 is being implemented through two legislative instruments:

Statutes Amendment Bill (SAB) – Introduction: 17 September 2024, Enactment: 28 April 2025.
Regulatory Services (Justice) Amendment Bill (RSJAB) – No confirmed date yet.

These changes remove unnecessary administrative burdens, improve risk-based compliance, and provide practical solutions for reporting entities managing AML obligations.

1. Removal of Address Verification for Low and Medium-Risk Customers

Current Requirement: All customers, regardless of risk, must provide verified proof of address.
New Rule: Address verification will no longer be required for low and medium-risk customers.

Impact on AML Compliance:

Faster onboarding for new clients.
Less administrative burden on businesses.
Greater focus on high-risk transactions, where verification is most needed.

2. Elimination of Mandatory Enhanced Customer Due Diligence (EDD) for Low-Risk Trusts

Current Requirement: All trusts must undergo Enhanced Due Diligence (EDD), including full verification of all beneficiaries.
New Rule: Low-risk trusts (such as simple family trusts) will no longer require mandatory EDD.

Impact on AML Risk Management:

Reduces unnecessary compliance costs for trust service providers, lawyers, and accountants.
Accelerates transaction processing for low-risk trusts.
Shifts compliance focus to high-risk trusts, such as offshore or complex structures.

3. Extended Prescribed Transaction Report (PTR) Timeframes to 20 Working Days

Current Rule: PTRs must be filed within 10 working days.
New Rule: The reporting timeframe is extended to 20 working days.

Impact on AML Compliance Programmes:

Reduces errors and rushed reporting by giving compliance officers more time to complete reports.
Minimises regulatory penalties for late submissions.
Helps AML compliance teams prioritise high-risk cases.

4. Extended Suspicious Activity Report (SAR) Timeframes for Lawyers

Current Rule: SARs must be submitted within three working days of identifying suspicious activity.
New Rule: Lawyers (and potentially other DNFBPs) will have five working days to submit SARs.

Impact on Legal AML Compliance:

Gives lawyers more time to assess suspicious transactions before reporting.
Aligns with real-world operational challenges in law firms.
Maintains AML/CFT compliance integrity while improving practical implementation.

Why Workstream 1 is a Major Shift for AML Compliance in New Zealand

Balances Compliance with Business Efficiency: AML/CFT obligations remain intact, but businesses will have more flexibility in low-risk scenarios.

Shifts Focus to High-Risk Transactions: Risk-based AML compliance allows reporting entities to prioritise resources where they are most needed.

Reduces Compliance Costs for Businesses: These changes make AML compliance in New Zealand more cost-effective, particularly for law firms, trust providers, and small businesses.

Final Thoughts: Preparing for AML/CFT Changes

New Zealand’s AML/CFT compliance landscape is evolving rapidly. Workstream 1 provides much-needed relief for reporting entities, but businesses must still ensure their AML compliance frameworks remain strong, effective, and aligned with regulatory expectations.

As these changes take effect, businesses should take a proactive approach by updating compliance programmes, training staff on new obligations, and ensuring reporting processes are adjusted to reflect the extended SAR and PTR timeframes. While the reforms will ease compliance burdens, they also require careful implementation to maintain regulatory alignment.

Seamless AML can support your business through this transition by providing expert guidance, compliance reviews, and tailored AML solutions to ensure you remain compliant while benefiting from the regulatory changes. Whether you need assistance updating your AML/CFT risk assessment, compliance programme, or reporting processes, Seamless AML can help you navigate these reforms with confidence.

If you have any questions about how these changes will impact your business, get in touch with Seamless AML today.