Do I need to ID my old clients? (The Pre-Commencement Rule)
"I have 500 landlords on my books. Do I have to ID them all by 1 July?" The answer is NO – but with conditions.
The answer: Section 36 (Pre-Commencement Customers)
Section 36: Pre-Commencement Customer (PCC) Relief
A Pre-Commencement Customer (PCC) is any customer whose business relationship with you existed before 1 July 2026. For PCCs, you only need to perform Initial CDD when:
- A suspicious matter reporting obligation arises
- There is a significant change in the nature or purpose of the relationship resulting in medium or high ML/TF/PF risk
Note: Once you complete Initial CDD on a PCC, their PCC status ends and ongoing CDD applies normally.
What this saves you
This provision potentially saves hundreds of hours of retrospective identification work. You do not need to contact every existing client demanding ID before the commencement date.
Key Takeaway
Section 36 provides relief for Pre-Commencement Customers (PCCs). You do not need to retrospectively ID all existing clients by 1 July 2026. Initial CDD on a PCC is only required if an SMR obligation arises or a significant change results in medium/high risk. Once Initial CDD is completed, PCC status ends.
Read our complete Tranche 2 Guide
Key dates, affected sectors, obligations and how to prepare
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