EU Commission overhauls AML & CFT rules
On 20 July 2021 the EU Commission has presented a package of legislative proposals to reform the EU’s anti-money laundering and countering terrorism financing (hereinafter “AML/CFT”) rules. According to the EU Commission, the aim of this package would be to improve the detection of suspicious transactions and activities, and to close loopholes used by criminals to launder illicit proceeds or finance terrorist activities through the financial system.
These new measures shall enhance the existing EU framework by taking into account new and emerging challenges linked to technological innovation including but not limited to virtual currencies: Because only certain categories of crypto-asset service providers are included in the scope of EU AML/CFT rules at present, the proposed reform shall extend these rules to the entire crypto sector, obliging all service providers to conduct due diligence on their customers. According to the EU Commission’s press release, these amendments shall ensure full traceability of crypto-asset transfers, such as Bitcoin, and shall allow the prevention and detection of their possible use for money laundering or terrorism financing. In addition, anonymous crypto asset wallets shall be prohibited.
The legislative package presented also includes the proposal for the creation of a new EU authority to fight money laundering: It shall transform AML/CFT supervision in the EU and enhance cooperation among Financial Intelligence Units (hereinafter “FIUs”). The new EU-level Anti-Money Laundering Authority (AMLA) shall be the central authority coordinating national authorities to ensure the private sector correctly and consistently applies EU rules. According to the plans of the EU Commission, AMLA shall also support FIUs to improve their analytical capacity around illicit flows and make financial intelligence a key source for law enforcement agencies.
To sum up, the package of legislative proposals consists of four legislative proposals:
- A Regulation establishing a new EU AML/CFT Authority;
- A Regulation on AML/CFT, containing directly-applicable rules, including in the areas of Customer Due Diligence and Beneficial Ownership;
- A sixth Directive on AML/CFT, replacing the existing Directive 2015/849/EU (the fourth AML directive as amended by the fifth AML directive), containing provisions that might be transposed into national law, such as rules on national supervisors and Financial Intelligence Units in EU Member States;
- A revision of the 2015 Regulation on Transfers of Funds to trace transfers of crypto-assets (Regulation 2015/847/EU).
In a next step, the legislative package shall be discussed by the European Parliament and Council. Currently, the EU Commission expects the future AML Authority to be operational in 2024.
These are the upcoming dates for our Annual General Meetings:
Thursday, 24 March 2022
Thursday, 23 March 2023