Is the Cook Islands on a Grey or Black List?

Cook Islands on the Global Watchlists: What Listing Status Means for YouCopy link to section

If you are weighing whether to incorporate in or hold assets through the Cook Islands, the question of its grey or black list status is a sensible starting point. The short answer is favourable: the Cook Islands does not appear on the EU list of non-cooperative jurisdictions, nor on either of the FATF watchlists, placing it among the cooperative jurisdictions recognised by the EU Council.

This standing matters to foreign owners, investors, and their advisers because list status feeds directly into how banks, payment processors, and tax authorities treat your entity. The sections below set out which bodies maintain these lists, where the Cook Islands sits on each, the history behind its position, and the practical effect on banking and due diligence. It is most relevant if you intend to use a Cook Islands company, trust, or investment structure with cross-border exposure to the EU or to correspondent banking networks.

The Lists That Matter: EU, FATF, OECD and Other Bodies ExplainedCopy link to section

Three frameworks dominate how a jurisdiction's reputation is judged, and each measures something different. Understanding the distinction prevents the common error of treating "blacklisted" as a single global verdict.

The EU list of non-cooperative jurisdictions for tax purposes targets tax abuse and unfair tax competition. It is split into two parts: Annex I, the actual blacklist of non-cooperative jurisdictions, and Annex II, a "state of play" document naming jurisdictions that have not yet complied but have committed to reform.

The EU's criteria align with international tax good governance standards developed by the OECD, drawing on the Global Forum on transparency, the Forum on Harmful Tax Practices, and the Inclusive Framework on BEPS. The list is managed by the Code of Conduct Group for Business Taxation, monitored by the European Commission, and revised twice a year, typically in February and October.

The Financial Action Task Force operates on a separate track focused on money laundering and terrorist financing. Founded in 1989 by the G7, it sets the 40 Recommendations that underpin AML/CFT frameworks worldwide and issues two public documents three times a year.

The Global Forum on Transparency and Exchange of Information for Tax Purposes assesses how well jurisdictions implement the exchange of information on request (EOIR) standard and automatic exchange (AEOI). Its EOIR reviews produce one of four ratings: Compliant, Largely Compliant, Partially Compliant, or Non-Compliant.

A point easily missed: FATF has no enforcement powers of its own. The real consequences come from banks and payment processors, which treat the FATF lists as mandatory inputs to their own risk models.

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Current Standing of the Cook Islands Across Each ListCopy link to section

On every major international list, the Cook Islands is clear. Each body measures a different risk, yet the result is consistent across all three.

For context on the EU side, Annex I held eleven jurisdictions as of October 2025, among them Panama, Vanuatu, Samoa, and the Russian Federation; the Cook Islands does not feature. The grey list contained another eleven, including the British Virgin Islands and the Seychelles, with the Cook Islands again absent.

The FATF blacklist as of June 2025 named only North Korea, Iran, and Myanmar. The net effect is that the Cook Islands is treated as a clean, cooperative jurisdiction across all three frameworks, with the OECD Phase 2 review the one open item.

EU Annex I and Annex II: Cook Islands History and StatusCopy link to section

The Cook Islands was not on the EU list when it first appeared on 5 December 2017. It did, however, spend a period on Annex II.

During 2017 and 2018, the Cook Islands sat on the EU grey list as one of 34 jurisdictions that committed to reform by the end of 2019. The EU's concern was a set of preferential tax regimes it classed as potentially harmful.

To meet that commitment, the territory passed legislation in December 2019 addressing the flagged regimes. In the February 2020 revision it was among twelve jurisdictions delisted entirely, exiting both Annex I and Annex II at once.

A news report in October 2020 described the Cook Islands as "blacklisted" by the European Commission, which conflicts with the official record. The EU Council timeline shows no formal re-listing after February 2020, and a 2022 Pacific Islands Forum Secretariat document confirms its removal alongside Nauru and Niue; the original basis for that report could not be verified against primary sources.

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FATF Grey and Black List Position for the Cook IslandsCopy link to section

The Cook Islands has never appeared on the FATF grey list or blacklist. Its AML/CFT performance has instead run through the mutual evaluation process, which is a separate track from the increased-monitoring lists.

Assessment is carried out jointly by the Asia/Pacific Group on Money Laundering (APG), of which the Cook Islands is a member, and the Group of International Finance Centre Supervisors. The most recent Mutual Evaluation Report followed an on-site visit from 20 November to 1 December 2017 and was published in 2018.

Under that report, the jurisdiction was rated Compliant on 5 and Largely Compliant on 33 of the FATF 40 Recommendations, with 5 of the 11 Immediate Outcomes assessed as Substantially Effective. No outcome reached Highly Effective. Evaluators found a technically sound framework but flagged weaknesses in financial analysis and in how law enforcement prioritised money laundering and terrorist financing matters.

A Financial Transactions Reporting Act enacted in 2017 strengthened risk-based supervision and reporting obligations. FATF began its 5th round of evaluations under a revised 2022 methodology in 2024, and the APG will adopt that methodology in turn; a new evaluation date for the Cook Islands has not been announced in public records.

OECD and Global Forum Assessments of the Cook IslandsCopy link to section

This is the one area with an open milestone. The Global Forum reviewed the Cook Islands' legal and regulatory framework, the Phase 1 EOIR review, in 2022 and found it generally in place for the availability, access, and exchange of relevant tax information, while identifying several areas needing improvement. The OECD issued that as a formal Second Round Peer Review Report.

Since then, the Global Forum Secretariat and the Asian Development Bank have provided technical assistance to close the gaps and prepare the territory for its Phase 2 review, which covers practical implementation. That support was announced in October 2024, and a mock on-site visit was held in Avarua from 8 to 10 October 2024.

The Phase 2 review launched in the fourth quarter of 2024, with findings expected to be published in 2025. As of mid-2026, no Phase 2 rating has been confirmed in available sources.

The Cook Islands is a Global Forum member. A full AEOI (CRS) peer review rating, and the precise CRS commencement date, were not confirmed in the sources reviewed.

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Reasons Cited in Past and Present ListingsCopy link to section

No current listing exists on any of the three frameworks, so there are no live reasons to address. The historical record, however, explains what triggered past attention.

The EU's 2017 to 2020 grey-listing rested on preferential tax regimes the EU judged potentially harmful, which the Cook Islands committed to reform by 31 December 2019 and then legislated away that December.

The 2018 mutual evaluation, while broadly positive, identified several recurring concerns:

• Structural weaknesses in the use of financial analysis and in prioritising money laundering, terrorist financing, and proceeds-of-crime issues by law enforcement.
• An understatement of threats from domestic offences by competent authorities, with vulnerabilities linked to limited resourcing and capacity.
• The asset protection and privacy features of Cook Islands international trust legislation, which draw wealthy individuals primarily from the United States and raise the money laundering risk profile.

In the earlier 2009 evaluation, the jurisdiction had fallen short of Largely Compliant on the recommendations covering confiscation measures and customer due diligence. The 2022 Global Forum Phase 1 review noted areas for improvement in the legal framework, though the specific points were not fully detailed in retrieved sources.

Commitments, Action Plans and the Path to DelistingCopy link to section

The EU exit followed a clear sequence: a reform commitment by 31 December 2019, legislation passed that December, and full delisting in the February 2020 Council revision that removed the territory from both annexes at once.

There is no active FATF action plan, because the Cook Islands has never been formally grey-listed. FATF delisting requires a country to address all action plan items identified at the time of listing, a process that does not apply here.

The Global Forum engagement is forward-looking rather than remedial. The Secretariat and the Asian Development Bank are helping close the Phase 1 gaps and prepare for Phase 2, which reflects proactive compliance rather than a response to a negative rating.

Two domestic measures underpin this position: the 2017 Financial Transactions Reporting Act, which placed risk-based obligations on reporting institutions, and the Financial Intelligence Unit, which moved from an administrative body to one with investigative powers under the FIU Act 2015. No current action plan with the EU, FATF, or Global Forum has been identified, consistent with the territory's clean status.

Practical Consequences for Banking, Due Diligence and Investor PerceptionCopy link to section

For a foreign owner, list status translates into concrete handling by banks and tax authorities. Because the Cook Islands is off all three lists, the mandatory penalties attached to listing do not apply to your entity.

A jurisdiction on EU Annex I exposes connected groups to increased withholding taxes, non-deductibility of payments, inclusion under controlled foreign company regimes, and limits on the participation exemption for dividends. Counterparties in FATF grey or black-listed jurisdictions trigger Enhanced Due Diligence, with deeper checks on source of funds, beneficial ownership, and transaction purpose. None of these list-driven measures attach to Cook Islands counterparties; standard due diligence is the baseline from an EU and FATF perspective.

Two caveats deserve attention. Pacific Island jurisdictions face a general re-listing risk tied to capacity constraints and shifting EU criteria, and this residual risk applies here.

Outlook: Where the Cook Islands Stands Heading ForwardCopy link to section

The territory holds a favourable position: off EU Annex I, off EU Annex II, and off the FATF lists as of mid-2026. For a Pacific offshore financial centre, that is a materially positive compliance standing.

The single variable worth watching is the Global Forum Phase 2 EOIR review, launched in the fourth quarter of 2024 with findings expected in 2025. Because the EU's criteria are explicitly tied to OECD and Global Forum ratings, a poor Phase 2 result could flow into renewed EU Annex II exposure.

The EU's revision cycle after October 2025 fell due in February 2026, and the Cook Islands was not affected by it. On the AML side, FATF's 5th-round methodology, begun in 2024, will eventually produce a fresh evaluation rating once the APG reaches the jurisdiction, though no date has been published.

For advisers, the practical step is to monitor the Global Forum's publications for the Phase 2 outcome. That result, more than any other near-term factor, will determine whether the current clean status holds.

ConclusionCopy link to section

The Cook Islands carries no EU or FATF listing, and its counterparties draw standard rather than enhanced due diligence on that basis, which is a sound footing for cross-border structuring. The one item to track is the pending Global Forum Phase 2 review, since its outcome connects directly to the EU's tax-cooperation criteria. Trust structures may still attract bank-level scrutiny independent of list status, so plan banking relationships with that in mind. For most foreign owners, the territory's standing supports incorporation and asset holding without the friction a listed jurisdiction would bring.

How Expanship Can Help Your Business in Cook IslandsCopy link to section

Expanship advises foreign owners on what Cook Islands list status means for their banking, tax position, and structure, and helps you keep documentation aligned with the transparency standards that govern that status. The same team handles the wider work of setting up and running a foreign-owned entity in the jurisdiction.

• Company formation and entity structuring
• Registered agent and registered office services
• Tax registration and filing
• Ongoing compliance and statutory maintenance
• Accounting and bookkeeping support
• Introductions to banking and payment providers

To discuss your structure, contact Expanship Cook Islands.

Frequently Asked QuestionsCopy link to section