BRUSSELS: The United States on Friday welcomed the blocking of a proposal to add a group of countries, including four American territories, to the EU money-laundering blacklist after almost all member states opposed it.

The US ambassador to the European Union, Gordon Sondland, hit out at the “dogmatic posturing” of the European Commission, the bloc’s executive arm.

The commission was behind the ill-fated plan which infuriated Saudi Arabia — which was also among the proposed additions — and exasperated European capitals.

EU diplomats complained that the way the commission had drawn up the list was unclear and potentially vulnerable to legal challenges, with as many as 27 out of 28 member states opposing it in a non-binding test vote on Thursday.

Crisis talks between the commission and the member states on Friday failed to yield any breakthrough and the proposed changes to the list will be formally killed off in a vote in the coming days.

“It’s heartening to see common sense from the member states prevail over the commission’s dogmatic posturing on this issue,” Sondland said in a statement.

He said the US fight against the bid to list the territories of Guam, Puerto Rico, American Samoa and the US Virgin Islands was a “whole of government effort that cut across agencies”.

“It’s a simply ridiculous waste when you think about all the effort that could instead have been spent on increasing GDP and jobs or on advancing the US-EU relationship. Instead, we had to spend our energy killing this bad idea,” he said.

Under the commission proposal, the new countries — which also included Panama — would have joined 16 others seen as doing too little to stop the financing of terrorism and organised crime.

Those blacklisted already include the likes of Iran, Iraq, Pakistan, Ethiopia and North Korea.

Inclusion on the EU list does not trigger sanctions, but it does oblige European banks to apply tighter controls on transactions with customers and institutions in those countries.

A European source said the problem with the commission proposal was “the criteria used to create the list and the way those criteria were applied”.

“If you bear in mind that such lists must stand up in court, then it might give you second thoughts. We must work on the criteria and also on the justification,” the source said.

The US was not the only affected country to mobilise against the list — Saudi Arabia’s King Salman intervened personally, writing to European leaders to protest.

The letter called the move to list the Gulf monarchy “surprising and unexpected” and warned it would damage “trade and investment flows between the kingdom and the European Union”. Commission spokeswoman Mina Andreeva defended the list, insisting that the methodology had been created in consultation with EU member states.

Published in Dawn, March 2nd, 2019