Council ¦ Taxation: Council Updates the EU List of Non-Cooperative Jurisdictions for Tax Purposes

What the 17 February 2026 Conclusions Mean for Financial Crime Risk

On 17 February 2026 the Council of the European Union approved updated conclusions on the revised EU list of non‑cooperative jurisdictions for tax purposes. The document reiterates the EU’s sustained focus on tax good governance – transparency, fair taxation and measures to prevent tax fraud, evasion and avoidance – and sets out the updated list of jurisdictions deemed non‑cooperative together with the state of play on cooperation from jurisdictions that have committed to reforms. The conclusions also endorse the Code of Conduct Group’s report and annex the EU list and a table of commitments and follow‑up items.

Key takeaways for financial crime practitioners

The Council reaffirms that tax transparency and effective information exchange are central to tackling cross‑border tax abuse and related financial crime. It recognises progress in several jurisdictions that have implemented the required standards, while also underlining persistent gaps in others. Importantly for compliance officers, risk managers and investigators, the conclusions highlight specific jurisdictions and the precise deficiencies that underlie their inclusion – concrete indicators that can be used to calibrate jurisdictional risk ratings and enhanced due diligence measures.

Bastian Schwind-Wagner _Follow

"The Council conclusions of 17 February 2026 reinforce the EU’s focus on tax transparency and fair taxation, identifying ten jurisdictions with shortcomings that increase financial crime and tax abuse risk. Financial institutions and compliance teams should treat the list as a prompt to tighten due diligence, verify substance, and monitor information‑exchange developments.

Jurisdictions that commit to reforms and undergo Global Forum or OECD Forum on Harmful Tax Practices, FHTP, reviews can be removed from the list, so practitioners must track those timelines and outcomes to adjust risk ratings. Immediate steps include updating country risk matrices and preparing contingency plans for cross‑border investigations where information exchange is limited."

Who remains on the EU list and why

The revised list includes ten jurisdictions: American Samoa; Anguilla; Guam; Palau; Panama; the Russian Federation; Turks and Caicos Islands; US Virgin Islands; Vanuatu; and Viet Nam. The Council’s reasoning for each varies but falls into a few recurring categories that matter for financial crime risk assessment.

• Absence or inadequate implementation of automatic exchange of financial account information (AEOI) remains a primary reason for listing. American Samoa, Guam and the US Virgin Islands are specifically noted for not applying automatic exchange, while other jurisdictions face shortcomings in commitments or timelines for implementation. Lack of AEOI materially weakens the ability of tax and law enforcement authorities to identify cross‑border tax evasion, unexplained wealth, and the proceeds of illicit activity.
• Weaknesses in exchange of information on request are another recurring issue. Palau and certain others have not ratified or implemented the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters or have not secured satisfactory Global Forum ratings. That limits the scope and speed of obtaining bank, ownership and transactional information in investigations.
• Harmful tax regimes and preferential regimes that facilitate profit shifting and artificial structures are flagged for Panama, the Russian Federation and US Virgin Islands among others. Where regimes allow foreign‑source income exemptions or preferential treatment for non‑resident entities without requiring real economic substance, they create attractive avenues for layering, hiding illicit proceeds, and eroding the tax base in other jurisdictions.
• Failure to implement or enforce substance requirements is explicitly identified for Anguilla, Turks and Caicos Islands and Vanuatu. Jurisdictions that permit the incorporation of entities that serve largely as letter‑box arrangements, without demonstrable economic activity, raise clear red flags for money laundering and tax crime.

Follow‑up commitments and timelines – what to watch next

The conclusions are not merely punitive: they set out expected remedial steps and timelines for jurisdictions that have made commitments.

Examples include:

• Anguilla, Panama and others have committed to specific steps on exchange of information and to request Global Forum in‑depth reviews by mid‑2026. Monitoring whether these reviews are requested and their outcomes will be a key signal of reduced risk.
• Viet Nam committed to addressing Global Forum recommendations, aiming to be reflected in the Action 13 peer review process in 2027 – relevant for transfer pricing and country‑by‑country reporting compliance.
• Some jurisdictions have been granted narrow extension windows to finalize reforms, such as Brunei Darussalam for specific tax regime reform with retroactive effect from 1 January 2026.
• The Council reiterates a standing concern about Türkiye’s outstanding automatic exchange of information with one EU Member State, repeatedly calling for resolution. In practice that highlights the EU’s insistence that full AEOI relationships are a hard condition for meeting criterion 1.1 of the EU list (AEOI legal and operational frameworks and active automatic information‑exchange relationships).

Implications for compliance programs and investigations

Financial institutions, corporate compliance functions, forensic accountants and law enforcement should treat the conclusions as an updated risk matrix.

Practical implications include:

• Enhanced due diligence and transaction monitoring for clients, counterparties or corporate structures linked to listed jurisdictions, especially where absence of AEOI, weak information‑on‑request mechanisms, or lack of substance is identified.
• Closer scrutiny of entities claiming foreign‑source income exemptions or preferential tax treatments originating in listed jurisdictions, and verification of economic substance and beneficial ownership documents.
• Prioritisation of cross‑border information requests and mutual legal assistance routes where listed jurisdictions are counterparties, with contingency plans for jurisdictions that do not participate in multilateral exchange instruments.
• Using the Council’s timelines and specified committed remedial actions as indicators to downgrade or upgrade jurisdictional risk once reforms are completed or reviews are conducted and published.

Wider policy and enforcement significance

The February 2026 conclusions demonstrate the EU’s continued use of a mix of listing, targeted dialogue through the Code of Conduct Group (business taxation) and reliance on international bodies such as the Global Forum and the Forum on Harmful Tax Practices (FHTP) to push jurisdictions toward compliance. For investigators, the list both signals jurisdictions where tax‑related mechanisms could be facilitating crime and identifies where international cooperation is expected to improve in the near term. The Council’s approach also shows that listings can change – jurisdictions that address transparency and substance can be removed following verification – which matters for strategic allocation of investigative resources.

Conclusion – practical next steps

For practitioners dealing with financial crime and tax risk, the Council conclusions provide actionable intelligence. Update internal country risk ratings in line with the list and the detailed reasons for inclusion. Intensify due diligence for relationships involving listed jurisdictions, verify economic substance and beneficial ownership rigorously, and monitor Global Forum and Forum on Harmful Tax Practices (FHTP) developments and in‑depth review outcomes. Finally, integrate the Council’s timelines into compliance roadmaps so your risk assessments can promptly reflect improvements or continued non‑cooperation.

Dive deeper

• Council of the European Union ¦ Taxation: Council updates the EU list of non-cooperative jurisdictions for tax purposes ¦ Link