Key Takeaways
- Vanuatu's standing is tracked across several frameworks at once, including EU Annex I and II, FATF, and OECD transparency ratings.
- Listings stem from specific cited reasons, and removal depends on meeting commitments and completing agreed action plans.
- Being listed creates real friction for foreign owners through enhanced due diligence, banking obstacles, and shifts in investor perception.
- Reviewing the timeline of listings and delistings shows how Vanuatu's compliance status has changed and where it appears to be heading.
Why Vanuatu's Listing Status Matters to Foreign Owners and Advisers
If you own or are considering a company in Vanuatu, the grey and black list position of the jurisdiction affects how your counterparties, banks, and the European Union treat your structure. The country sits on two live European lists: Annex I of the EU list of non-cooperative jurisdictions for tax purposes, and the separate EU list of high-risk third countries for anti-money-laundering. It is not on the FATF grey list or blacklist.
This article explains where the jurisdiction stands across each international body, why it was listed, what its authorities are doing to come off, and what all of this means in practice for a foreign-owned entity. It is most relevant to non-resident investors, their tax advisers, and compliance officers who must account for these statuses when dealing with the country.
The Aggregator: Every Grey and Black List Affecting Vanuatu at a Glance
A single picture helps before the detail. The firm carries two active European listings, has exited FATF monitoring, and holds a recently improved OECD rating that is still short of the top tier.
| Body / List | Status | Notes |
|---|---|---|
| EU Annex I (tax blacklist) | Listed | One of 11 jurisdictions confirmed in the February 2025 update |
| EU AML/CFT high-risk list | Listed | On the EU list since the 2016 first iterations; retained in the December 2025 update |
| FATF grey list | Not listed | Removed June 2018; absent from current FATF publications |
| FATF blacklist | Not listed | Not subject to a call for action |
| OECD Global Forum (EOIR) | Largely Compliant | Upgraded from "Partially Compliant" in April 2026 |
The two EU listings run on separate legal tracks, so progress on one does not automatically clear the other.
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The EU Lists: Vanuatu on Annex I (Blacklist) and Annex II (Greylist)
The harder of the two tax-related instruments is Annex I, the list of non-cooperative jurisdictions for tax purposes. On 18 February 2025, the Council maintained the jurisdiction on that list alongside American Samoa, Anguilla, Fiji, Guam, Palau, Panama, Russia, Samoa, Trinidad and Tobago, and the US Virgin Islands.
The country was first added to Annex I in March 2019, under criterion 2.2, after failing to meet EU requirements by the 31 December 2018 deadline. A second, independent ground was later added under criterion 1.2, following the "Partially Compliant" OECD rating handed down in 2019.
Annex I status carries a concrete reporting consequence. For financial years starting on or after 22 June 2024, EU Public Country-by-Country Reporting requires data to be published for each listed jurisdiction, with a minimum two-year window for any name on Annex I or Annex II.
The cooperative "greylist", Annex II, is a separate matter. The country has never appeared on it; it was placed directly onto the harder Annex I, bypassing the commitment-based track entirely.
A distinct instrument, the EU AML/CFT high-risk list, sits outside the tax framework altogether. Established under the EU's anti-money-laundering directives, this list began applying its own methodology from July 2018, and the jurisdiction was retained on it even after FATF removed the country that same year.
The Annex I tax blacklist and the AML/CFT high-risk list are governed by different rules and different EU bodies. Clearing one does not clear the other, and the December 2025 AML/CFT update kept the country listed.
The FATF Grey List: Vanuatu's Listing, Action Plan, and Delisting History
The Financial Action Task Force grey-listed the jurisdiction in February 2016, after a decade of insufficient AML/CFT progress dating from the first regional on-site visit in 2005. The action plan that followed identified eight strategic deficiencies, backed by high-level political commitments in 2016 and 2017.
Reform moved quickly once it began. Parliament approved 30 legislative bills in June and November 2017, aligning the national framework with the FATF Action Plan and the FATF 40 Recommendations, and a National AML and CTF Coordinating Committee was created to manage delivery.
The FATF's review group judged the action plan substantially complete in February 2018 and scheduled an on-site visit, which took place that May. At the June 2018 plenary, the FATF confirmed the country would no longer be subject to its monitoring process.
The current position is straightforward: the jurisdiction appears on neither the FATF grey list nor the blacklist, a status confirmed by the FATF country page.
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OECD Forum on Transparency and Exchange of Information Ratings
A member of the OECD Global Forum since 2009, the jurisdiction was rated "Partially Compliant" in its 2019 exchange-of-information peer review. That rating was the trigger for the EU's criterion 1.2 listing ground.
Preparation for a fresh assessment was deliberate. A mock on-site visit in Port Vila in April 2024, run with the Global Forum Secretariat and the Asian Development Bank, preceded a supplementary review launched in the final quarter of 2024.
On 29 April 2026, the Global Forum published the supplementary report, upgrading the rating to "Largely Compliant". The improvement reflects better availability of legal, beneficial-ownership, and accounting information.
Two recommendations remain open. The report asks for clearer identification of nominee shareholders and stronger supervision and enforcement around the availability of ownership, accounting, and banking information.
This upgrade matters directly for the EU position, because criterion 1.2 requires a "Compliant" or "Largely Compliant" Global Forum rating. The 2026 result satisfies that criterion in principle.
Other National and Supranational Lists to Watch
Beyond the EU instruments and FATF, a few bodies are worth checking. The country is a founding member of the Asia/Pacific Group on Money Laundering, the FATF-style regional body for the region, and is not subject to any APG membership action.
The OECD's Inclusive Framework on BEPS connects to EU criterion 2.3, and non-membership has been cited as a contributing factor in the listing. No public confirmation has been retrieved that the jurisdiction has since joined the framework.
No public data indicates a US IRS or FATCA designation as non-cooperative, nor a formal UK or Australian national tax blacklist that names the country.
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The Reasons Cited: What Triggered Vanuatu's Listings
The grounds differ by list. For the EU tax blacklist, two criteria are active: criterion 2.2, concerning offshore structures without genuine local economic activity, and criterion 1.2, the OECD rating ground added after the 2019 "Partially Compliant" assessment.
The AML/CFT listing has a different origin. When the EU adopted its own stricter methodology after the 5th Anti-Money Laundering Directive, it kept the jurisdiction listed even though FATF had cleared it. A 2021 letter from the EU's financial-services directorate, DG FISMA, pointed specifically to wider availability of beneficial-ownership information and the identification of nominee shareholder structures.
The historical FATF grey-listing traced back to strategic deficiencies in the AML/CFT legal framework identified across regional on-site visits in 2005 and 2015. Secrecy rules in force before the 2017 reforms had obstructed authorities seeking access to information.
Commitments and Action Plans for Coming Off the Lists
Exit from the EU tax blacklist requires satisfying both listing criteria. Criterion 1.2 is now met through the April 2026 "Largely Compliant" rating, leaving criterion 2.2, on economic substance, as the principal outstanding obstacle.
- Criterion 1.2 (OECD rating) - satisfied by the 2026 upgrade
- Criterion 2.2 (genuine economic substance) - not publicly resolved; no published deadline retrieved
The national regulator, the Vanuatu Financial Services Commission, has confirmed that its beneficial-owner registry is fully implemented, addressing the concern raised in the EU's 2021 letter. That step was acknowledged but did not by itself trigger delisting.
Removal from the AML/CFT high-risk list runs on its own benchmarks. No formal written action plan between the jurisdiction and the European Commission has been published; exchanges appear to have been bilateral and partly informal.
On the OECD side, work continues on nominee-shareholder identification and supervision. A Trust Bill is before Parliament, shareholder-identification forms are expected during 2026, and 2024 amendments clarified the beneficial-ownership definition and reporting obligations.
Practical Consequences: Enhanced Due Diligence, Banking Friction, and Investor Perception
For a foreign owner, the most immediate effect comes from the AML/CFT listing. EU banks and other obliged entities are legally required to apply enhanced customer due diligence to any transaction or relationship connected to the jurisdiction.
In practice, that means more documentation, explanation of the source of funds, closer scrutiny, and more frequent monitoring. These checks attach to your structure regardless of its legitimacy, simply because of the listing.
The Annex I tax status adds regulatory layers. EU taxpayers face Public Country-by-Country Reporting for financial years from 22 June 2024, and under the DAC6 hallmark for cross-border arrangements, payments to recipients in the jurisdiction may trigger a mandatory reporting obligation even where no tax benefit is the main aim.
Listed status can affect access to international payment networks and correspondent banking. Expect longer onboarding, more questions, and the possibility of declined relationships at some institutions.
Perception is the harder cost to quantify. Some EU policymakers have publicly questioned the fairness of the two listings, noting that neither the OECD nor independent observers classify the jurisdiction's tax regime as a tax haven; the presence of a citizenship-by-investment programme nonetheless heightens due-diligence sensitivity for applicants and counterparties.
Timeline of Listings and Delistings: How Vanuatu's Status Has Evolved
| Date | Event |
|---|---|
| Sept 2015 | Regional mutual evaluation notes AML/CFT deficiencies |
| Feb 2016 | Grey-listed by FATF |
| Jul 2016 | EU launches its AML/CFT list, mirroring FATF; jurisdiction included |
| Jun & Nov 2017 | 30 AML/CFT bills passed by Parliament |
| Feb 2018 | FATF review group finds action plan substantially complete |
| Jun 2018 | FATF removes the jurisdiction from its grey list |
| Jul 2018 | EU applies its own AML/CFT methodology; jurisdiction retained |
| Mar 2019 | Added to EU Annex I (tax blacklist) under criterion 2.2 |
| 2019 | OECD rates the jurisdiction "Partially Compliant" |
| Post-2019 | EU adds criterion 1.2 as a further Annex I ground |
| ~2022 | Beneficial-owner registry confirmed fully implemented |
| Q4 2024 | OECD launches supplementary EOIR review |
| Feb 2025 | EU keeps the jurisdiction on Annex I without change |
| Dec 2025 | EU 13th AML/CFT iteration retains the jurisdiction |
| Apr 2026 | OECD upgrades the rating to "Largely Compliant" |
Outlook: Where Vanuatu's Compliance Standing Is Heading
The April 2026 OECD upgrade is the most consequential development in years, because "Largely Compliant" meets EU criterion 1.2 and removes one of the two grounds for the tax blacklist. The result also signals genuine progress on information availability.
Criterion 2.2, on offshore structures and economic substance, has not been publicly resolved and stands as the main barrier to Annex I removal. No published deadline or action plan for that criterion has been retrieved.
Legislative momentum continues, with a Trust Bill before Parliament and new shareholder-identification forms expected in 2026. If enacted and enforced, these measures could support future OECD and EU assessments.
Removal from the AML/CFT high-risk list is the slower question. That track runs on EU-specific benchmarks rather than FATF outcomes, which makes any exit timeline uncertain and non-automatic, and regional bodies continue to characterise the EU assessment process as unilateral and capacity-blind for small Pacific economies.
Conclusion
A foreign-owned company in the jurisdiction operates under two live EU listings and a recently improved OECD rating, with no FATF designation. The practical reality is enhanced due diligence at EU banks, extra reporting for EU counterparties, and some reputational friction, even though the underlying regime is not classed as a tax haven. The 2026 OECD upgrade clears one of two grounds for the tax blacklist, but full delisting from both EU instruments remains some way off and is not on a published schedule. Plan your structure and banking relationships with these statuses in view rather than assuming they will lift in the near term.
How Expanship Can Help Your Business in Vanuatu
Expanship advises foreign owners on what the EU and OECD listings mean for a specific structure, how to prepare for the enhanced due diligence that banks and counterparties will apply, and how to keep beneficial-ownership and reporting records aligned with evolving requirements. Alongside this, we handle the wider lifecycle of a foreign-owned entity in the jurisdiction.
- Company formation and entity setup
- Registered agent and registered office services
- Tax registration and ongoing filings
- Compliance management and beneficial-ownership maintenance
- Accounting and bookkeeping
- Introductions to banking partners
To discuss your situation, contact Expanship Vanuatu.
Frequently Asked Questions
No. The jurisdiction was removed from the FATF grey list in June 2018 after completing its action plan, and it appears on neither the grey list nor the blacklist in current FATF publications.
It sits on EU Annex I under two criteria: criterion 2.2, on offshore structures lacking genuine economic activity, and criterion 1.2, the OECD rating ground. The 2026 upgrade to "Largely Compliant" satisfies criterion 1.2, leaving the economic-substance ground as the remaining obstacle.
EU banks and other obliged entities must apply enhanced customer due diligence to transactions and relationships connected to the jurisdiction. Expect requests for source-of-funds evidence, additional documentation, slower onboarding, and closer ongoing monitoring.
Not on its own. The April 2026 "Largely Compliant" rating clears criterion 1.2, but criterion 2.2 on genuine economic substance must also be resolved before the EU would remove the jurisdiction from Annex I.
Since July 2018 the EU has applied its own methodology rather than mirroring FATF. That is why the jurisdiction remained on the EU AML/CFT list even after FATF removed it, and why exit depends on EU-specific benchmarks rather than FATF compliance alone.
No public target date has been announced for either EU list. Progress is real, particularly the OECD upgrade, but Annex I removal still requires resolving economic-substance concerns, and the AML/CFT track moves independently on its own timetable.
Legal Disclaimer
The information provided in this article is for general informational purposes only and does not constitute legal, tax, or professional advice. While we strive to ensure the accuracy and timeliness of the content, laws and regulations are subject to change, and the application of laws can vary widely based on specific facts and circumstances.
Readers should not act upon this information without seeking professional counsel tailored to their individual situation. Expanship and its authors disclaim any liability for actions taken or not taken based on the content of this article.
For specific advice regarding your business setup, compliance requirements, or any legal matters, please consult with qualified legal and tax professionals in the relevant jurisdiction.
