---
title: "When the counterparty refuses CDD - can I proceed with transaction under the \"deemed compliance\" carve-out?"
description: "When the counterparty refuses CDD - can I proceed with transaction under the \"deemed compliance\" carve-out - You can still legally proceed."
---

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# When the counterparty refuses CDD - can I proceed with transaction under the "deemed compliance" carve-out?

## Yes for the party you are not acting for, under the deemed compliance provision, but only if reasonable steps.

You can still legally proceed. AUSTRAC has specifically built a "deemed compliance" provision into the Rules (s 6-33) for exactly this scenario, but it only applies to the party you're **not** acting for, and only if you've ticked three specific boxes.

This was added in direct response to industry feedback during the rule-making - agents pointed out they have no contractual leverage over the counterparty, and AUSTRAC accepted that a blanket "no CDD = no service" rule would be unworkable for real estate. AUSTRAC introduced a deemed CDD for real estate agents to address situations where genuine attempts to conduct CDD on counterparties have been unsuccessful. [AUSTRAC](https://www.austrac.gov.au/about-us/legislation/updates-legislation/amendments-amlctf-rules)

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