VATICAN CITY (CNS) -- Individuals carrying more than 10,000 euros (about $14,000) into or out of Vatican City State must declare the amount to proper authorities under a new law aimed at meeting international norms against money-laundering and financing terrorism.

The new measures to guarantee financial transparency in the Vatican went into effect April 1 and reflect the latest European Union regulations.

At the end of 2010, Pope Benedict XVI established the Financial Information Authority, an independent agency to oversee monetary and commercial activities of all Vatican-related institutions, including the Vatican bank.

At the same time, the Vatican promulgated a new law that defined financial crimes and established penalties -- including possible jail time -- for their violation.

One provision of the new law required that anytime more than 10,000 euros is brought into or out of Vatican City, whether in the form of cash, coins or checks, it must be declared, the Vatican said in a written statement April 1.

If the money is involved in any kind of transaction with a Vatican office or organization, including the Vatican bank, the declaration goes to the designated administrator in that office, the statement said.

If, however, the currency is to remain in the individual's personal possession and will not be transferred, then the amount must be declared to the Vatican gendarmes at the entrance of Vatican City, it said.

The Vatican gendarmes have the authority to stop and search vehicles, bags or other objects if they have any reason to suspect the required currency declaration has not been made, the statement said.

The declaration of currency of more than 10,000 euros in value is a normal part of most customs and border control duties, Jesuit Father Federico Lombardi, the Vatican spokesman, told journalists. Currency declarations help trace the flow of large amounts of money and prevent or detect money-laundering and other financial improprieties, he added.

The declaration includes a statement of where the money came from and its intended purpose, Father Lombardi said.

The Vatican's Financial Information Authority also sent a memo to all Vatican offices and departments making sure each office had the proper staff and procedures in place to comply with and enforce the new norms and standards of registering and archiving transactions and reporting suspicious activity to the financial authority.

The memo included a list of things staff should be on the lookout for that might indicate suspicious financial operations or activity, the Vatican statement said.

The statement said the financial authority may establish further detailed norms as specific problems or needs arise.

The authority monitors Vatican entities, including the Vatican bank, the Vatican's investment agency, the Vatican pharmacy, supermarket and the Vatican Museums.

Pope Benedict established the oversight agency after Italian treasury police, in a money-laundering probe, seized 23 million euros ($32 million) that the Vatican bank had deposited in a Rome bank account. The Vatican criticized the confiscation, saying the deposit was legitimate and that the Vatican bank was committed to "full transparency" in its operations.

The Vatican has been working for some time with Italian and international authorities to comply with procedures to ensure funds are not used for terrorism or money laundering.