BETA


2021/0239(COD) Prevention of the use of the financial system for the purposes of money laundering or terrorist financing

Progress: Procedure completed

RoleCommitteeRapporteurShadows
Joint Responsible Committee ['ECON', 'LIBE'] HEINÄLUOMA Eero (icon: S&D S&D), CARÊME Damien (icon: Verts/ALE Verts/ALE) BRAUNSBERGER-REINHOLD Karolin (icon: EPP EPP), SEEKATZ Ralf (icon: EPP EPP), ROBERTI Franco (icon: S&D S&D), PÎSLARU Dragoş (icon: Renew Renew), STRUGARIU Ramona (icon: Renew Renew), PETER-HANSEN Kira Marie (icon: Verts/ALE Verts/ALE), WIŚNIEWSKA Jadwiga (icon: ECR ECR), ZĪLE Roberts (icon: ECR ECR), BECK Gunnar (icon: ID ID), GARRAUD Jean-Paul (icon: ID ID), DALY Clare (icon: GUE/NGL GUE/NGL), SCHIRDEWAN Martin (icon: GUE/NGL GUE/NGL)
Committee Opinion JURI
Lead committee dossier:
Legal Basis:
RoP 58, TFEU 114-p1

Events

2024/06/19
   Final act published in Official Journal
2024/05/31
   CSL - Draft final act
Documents
2024/05/31
   CSL - Final act signed
2024/05/30
   EP/CSL - Act adopted by Council after Parliament's 1st reading
2024/04/24
   EP - Text adopted by Parliament, 1st reading/single reading
Details

The European Parliament adopted by 479 votes to 61, with 32 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing.

The European Parliament’s position adopted at first reading under the ordinary legislative procedure amends the proposal as follows:

Obliged entities

In addition to financial institutions, banks, real estate agencies, asset management services, casinos, auditors, accountants and tax advisors, the list of reporting entities also covers lawyers , persons dealing in high-value goods and cultural goods , mortgage and consumer credit intermediaries, mixed non-financial holding companies, football agents and professional football clubs for transactions with an investor, with a sponsor, with football agents or other intermediaries for a football player’s transfer.

Obliged entities wishing to carry out activities within the territory of another Member State for the first time should notify the supervisors of their home Member State of the activities which they intend to carry out in that other Member State.

Business-wide risk assessment

Obliged entities should take appropriate measures, proportionate to the nature of their business, including its risks and complexity, and their size, to identify and assess the risks of money laundering and terrorist financing to which they are exposed, as well as the risks of non-implementation and evasion of targeted financial sanctions. They should take account of information on money laundering and terrorist financing risks provided by competent authorities and information on the customer base.

Group-wide requirements

A parent undertaking should ensure that the requirements on internal procedures, risk assessment and staff apply in all branches and subsidiaries of the group in the Member States and, for groups whose head office is located in the Union, in third countries. To this end, a parent undertaking should perform a group-wide risk assessment, taking into account the business-wide risk assessment performed by all branches and subsidiaries of the group, and establish and implement group-wide policies, procedures and controls to ensure that employees within the group are aware of the requirements arising from this Regulation.

Application of customer due diligence

Reporting entities should apply customer due diligence measures when they carry out, on an occasional basis, a transaction of at least EUR 10 000 , when there is a suspicion of money laundering or terrorist financing or when there are doubts as to whether the person with whom they are interacting is the customer or the person authorised to act on the customer's behalf.

By way of derogation, providers of crypto-asset services should apply customer due diligence measures when carrying out transactions of EUR 1 000 or more . In addition, reporting entities should at least have to apply customer due diligence measures when they carry out an occasional cash transaction of at least EUR 3 000.

Customer due diligence measures

Obliged entities should inter alia :

- identify the customer and verify the customer’s identity;

- verify whether the customer or the beneficial owners are subject to targeted financial sanctions , and, in the case of a customer or party to a legal arrangement who is a legal entity, whether natural or legal persons subject to targeted financial sanctions control the legal entity or have more than 50 % of the proprietary rights of that legal entity or majority interest in it, whether individually or collectively;

- assess and, as appropriate, obtain information on the nature of the customers’ business, including, in the case of undertakings, whether they carry out activities, or of their employment or occupation;

- determine whether the customer, the beneficial owner of the customer and, where relevant, the person on whose behalf or for the benefit of whom a transaction or activity is being carried out is a politically exposed person, a family member or person known to be a close associate;

- verify that any person purporting to act on behalf of the customer is so authorised and identify and verify their identity.

Obliged entities should report to the central registers any discrepancies they find between the information available in the central registers and the information they collect.

Third-country policy

To protect the proper functioning of the Union’s financial system from money laundering and terrorist financing, the Commission should be empowered to adopt delegated acts to identify third countries whose shortcomings in their national AML/CFT regimes represent a threat to the integrity of the Union’s internal market. In order to ensure a consistent identification of third countries that pose a specific and serious threat to the Union’s financial system, while not being publicly identified as subject to calls for actions or increased monitoring by the FATF, the Commission should be able to set out, by means of an implementing act, the methodology for the identification in exceptional circumstances of such third countries.

Enhanced due diligence measures

Where a business relationship that is identified as having a higher risk involves the handling of assets with a value of at least EUR 5 000 000 , or the equivalent in national or foreign currency, through personalised services for a customer holding total assets with a value of at least EUR 50 000 000 , or the equivalent in national or foreign currency, whether in financial, investable or real estate assets, or a combination thereof, excluding that customer's private residence, credit institutions, financial institutions and trust or company service providers should apply enhanced due diligence measures.

Beneficial owners

The amended text harmonises the rules on beneficial owners and makes them more transparent. The beneficial owners of legal entities are natural persons who: (a) have, directly or indirectly, an ownership interest in the corporate entity; or (b) control, directly or indirectly, the corporate or other legal entity, through ownership interest or via other means. Participation in the capital of the company means the direct or indirect holding of at least 25% of the shares, or the holding of at least 25% of the voting rights or any other type of participation in the capital of the company.

Documents
2024/04/24
   EP - Debate in Parliament
2024/04/24
   EP - Decision by Parliament, 1st reading
2024/03/19
   EP - Approval in committee of the text agreed at 1st reading interinstitutional negotiations
Documents
2024/03/19
   EP - Approval in committee of the text agreed at 1st reading interinstitutional negotiations
Documents
2024/02/14
   CSL - Coreper letter confirming interinstitutional agreement
2024/02/13
   EP - Text agreed during interinstitutional negotiations
Documents
2023/04/19
   EP - Committee decision to enter into interinstitutional negotiations confirmed by plenary (Rule 71)
2023/04/17
   EP - Committee decision to enter into interinstitutional negotiations announced in plenary (Rule 71)
2023/04/14
   EP - Committee report tabled for plenary, 1st reading
Details

The Committee on Economic and Monetary Affairs and the Committee on Civil Liberties, Justice and Home Affairs jointly adopted the report by Eero HEINÄLUOMA (S&D, FI) and Damien CARÊME (Greens/EFA, FR) on the proposal for a regulation of the European Parliament and of the Council on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing.

The committee responsible recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the proposal as follows:

Subject matter

Members stated that the proposed Regulation should lay down rules concerning:

- measures to be applied by obliged entities to mitigate and manage the risks of non-implementation and evasion of targeted financial sanctions;

- measures to prevent money laundering and terrorist financing in Member States which allow for citizenship or residence rights in exchange for any kind of investment, including capital transfers, purchase or renting of property, investment in government bonds, investment in corporate entities, donation or endowment of an activity contributing to the public good and contributions to the state budget;

- measures to mitigate risks deriving from anonymous instruments and limit the misuse of bearer instruments.

Obliged entities

The amended text adds wealth managers to the list of entities subject to AML/CFT rules, as well as high-level football clubs, agents in the football sector and Member States’ football associations.

Moreover, the report stressed that the risks of ML/FT involving works of art and other high value goods are well known. Therefore, it proposed to reduce the value of goods from which due diligence obligations apply from EUR 10 000 to EUR 5 000.

Ban on citizenship by investment and minimum requirements regarding citizenship and residence by investment schemes

Member States should not put in place schemes under national law which allow for citizenship rights in exchange for any kind of investment, including capital transfers, the purchase or renting of property, investment in government bonds, investment in corporate entities, donation or endowment of an activity contributing to the public good and contributions to the state budget, and without a genuine link with the Member States concerned.

Register the beneficial owner of these entities in the Union

The concept of beneficial ownership is crucial to increase transparency of complex corporate structures and ease compliance with AML/CFT rules. In this regard, the beneficial ownership (BO) register is a key instrument to grant sufficient transparency and assist obliged entities in their customer due diligence obligations as well as competent authorities in their tasks. However, to reduce the chances to circumvent this tool, it is important to reduce the percentage threshold that serves as indication of ownership of a legal entity from 25% to 15%.

Reporting of suspicions

Members considered that obliged entities should report all suspicions of money laundering, terrorist financing or predicate offences to the FIU, including suspicious attempted transactions. They should reply to a request for information by the FIU within five working days, unless the FIU determines a different deadline.

By three years from the entry into force of this Regulation, AMLA should develop an electronic filing system, (FIU.net one-stop-shop), to be used by obliged entities to submit to the FIU of the Member State in whose territory the obliged entity transmitting the information is established, and to any other concerned FIU, reports of suspicion of money laundering, predicate offences and terrorist financing, including on attempted transactions. The FIU.net one-stop-shop should provide a single access point for reporting of suspicions through protected channels of communications and via a standardised form.

Exchange of data under partnerships for information sharing in AML/CFT field

To combat money laundering and terrorist financing, the amended text suggested that obliged entities and public authorities may participate in partnerships for information sharing in AML/CFT field established under national law in one or across several Member States.

Each Member State may lay down in its national law that, to the extent that is necessary and proportionate, obliged entities, and where applicable, public authorities that are party to the partnership for information sharing in AML/CFT field, may share personal data collected in the course of performing customer due diligence obligations and process that data within the partnership for the purposes of the prevention of money laundering and terrorist financing, provided that at a minimum of requirements are respected.

Limits to large cash payments

The amended text proposed that persons trading in goods or providing services may accept or make a payment in cash only up to an amount of EUR 7 000 (as opposed to EUR 10 000) or equivalent amount in national or foreign currency, whether the transaction is carried out in a single operation or in several operations which appear to be linked. Member States should not discriminate between residents and non-residents with regard to the limits applicable for cash payments.

Payments in crypto-assets without the involvement of a crypto-asset service provider

The report stated that persons trading in goods or providing services may accept or make a transfer in crypto-assets from a selfhosted address only up to an amount equivalent to EUR 1 000 whether the transaction is carried out in a single operation or in several operations which appear to be linked, unless the customer or beneficial owner of such self-hosted address can be identified.

Member States should ensure that appropriate measures, including sanctions, are taken against natural or legal persons acting in their professional capacity which are suspected of a breach of the limit.

Documents
2023/03/28
   EP - Vote in committee, 1st reading
2023/03/28
   EP - Committee decision to open interinstitutional negotiations with report adopted in committee
2022/07/05
   EP - Amendments tabled in committee
Documents
2022/07/05
   EP - Amendments tabled in committee
Documents
2022/07/05
   EP - Amendments tabled in committee
Documents
2022/03/15
   EP - Committee draft report
Documents
2022/02/16
   ECB - European Central Bank: opinion, guideline, report
2022/01/03
   CZ_SENATE - Contribution
Documents
2021/12/16
   EP - Referral to joint committee announced in Parliament
2021/12/08
   ESC - Economic and Social Committee: opinion, report
Documents
2021/11/25
   EP - HEINÄLUOMA Eero (S&D) appointed as rapporteur in ['ECON', 'LIBE']
2021/11/25
   EP - CARÊME Damien (Verts/ALE) appointed as rapporteur in ['ECON', 'LIBE']
2021/11/22
   ES_PARLIAMENT - Contribution
Documents
2021/11/22
   ES_PARLIAMENT - Contribution
Documents
2021/11/22
   ES_PARLIAMENT - Contribution
Documents
2021/11/08
   PT_PARLIAMENT - Contribution
Documents
2021/10/04
   EP - Committee referral announced in Parliament, 1st reading
2021/09/22
   EDPS - Document attached to the procedure
Documents
2021/07/22
   EC - Document attached to the procedure
2021/07/22
   EC - Document attached to the procedure
2021/07/22
   EC - Document attached to the procedure
2021/07/20
   EC - Legislative proposal published
Details

PURPOSE: to lay down rules on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (Single EU Rulebook).

PROPOSED ACT: Regulation of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: money laundering and terrorist financing pose a serious threat to the integrity of the EU economy and financial system and the security of its citizens. Europol estimated that around 1% of the EU’s annual Gross Domestic Product is ‘detected as being involved in suspect financial activity’. The fight against money laundering and terrorist financing is vital for financial stability and security in Europe.

Legislative gaps in one Member State have an impact on the EU as a whole.

It is therefore necessary that rules on matters currently covered in Directive (EU) 2015/849 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing which may be directly applicable by the obliged entities concerned are addressed in a new Regulation in order to achieve the desired uniformity of application.

The EU’s Security Union Strategy for 2020-2025 highlighted the importance of enhancing the EU’s framework for anti-money laundering and countering terrorist financing in order to protect Europeans from terrorism and organised crime.

Furthermore, on 20 July 2021, the European Commission presented an ambitious package of legislative proposals to strengthen the EU’s anti-money laundering and countering the financing of terrorism (AML/CFT) rules. It is part of the Commission’s commitment to protect EU citizens and the EU's financial system from money laundering and terrorist financing. The aim is to improve the detection of suspicious transactions and activities, and close loopholes used by criminals to launder illicit proceeds or finance terrorist activities through the financial system.

CONTENT: the Commission proposal aims to lay down rules on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing with the objective of setting up a single EU rulebook for AML/CFT which will harmonise AML/CFT rules across the EU, including, for example, more detailed rules on customer due diligence, beneficial ownership and the powers and task of supervisors and Financial Intelligence Units (FIUs). Existing national registers of bank accounts will be connected, providing faster access for FIUs to information on bank accounts and safe deposit boxes.

The Commission will also provide law enforcement authorities with access to this system, speeding up financial investigations and the recovery of criminal assets in cross-border cases.

The proposed regulation makes a number of changes to the existing AML/CFT Directive in order to bring about a greater level of harmonisation and convergence in the application of AML/CFT rules across the EU:

- in order to mitigate new and emerging risks, the list of obliged entities is expanded to include crypto-asset service providers but also other sectors such as crowdfunding platforms and migration operators;

- to ensure consistent application of rules across the internal market, requirements in relation to internal policies, controls and procedures are clarified, including in the case of groups, and customer due diligence measures are made more granular, with clearer requirements according to the risk level of the customer;

- the requirements in relation to third countries are reviewed to ensure that enhanced due diligence measures are applied to those countries that pose a threat to the Union’s financial system;

- requirements in relation to politically exposed persons are subject to minor clarifications, particularly as regards the definition of a politically exposed person;

- beneficial ownership requirements are streamlined to ensure an adequate level of transparency across the Union, and new requirements are introduced in relation to nominees and foreign entities to mitigate risks that criminals hide behind intermediate levels;

- to guide more clearly reporting of suspicious transactions, red flags raising suspicion are clarified, whereas disclosure requirements and private-to-private sharing of information remain unaltered;

- in order to ensure full consistency with EU data protection rules, requirements for the processing of certain categories of personal data are introduced and a shorter time-limit is provided for retention of personal data;

- provisions preventing traders in goods or services from accepting cash payments of over EUR 10 000 for a single purchase, while allowing Member States to maintain in force lower ceilings for large cash transactions.

Documents

  • Draft final act: 00036/2024/LEX
  • Text adopted by Parliament, 1st reading/single reading: T9-0365/2024
  • Debate in Parliament: Debate in Parliament
  • Approval in committee of the text agreed at 1st reading interinstitutional negotiations: PE759.083
  • Approval in committee of the text agreed at 1st reading interinstitutional negotiations: PE759.083
  • Coreper letter confirming interinstitutional agreement: GEDA/A/(2024)000995
  • Text agreed during interinstitutional negotiations: PE759.083
  • Committee report tabled for plenary, 1st reading: A9-0151/2023
  • Amendments tabled in committee: PE734.116
  • Amendments tabled in committee: PE734.117
  • Amendments tabled in committee: PE734.118
  • Committee draft report: PE719.945
  • European Central Bank: opinion, guideline, report: CON/2022/0005
  • European Central Bank: opinion, guideline, report: OJ C 210 25.05.2022, p. 0015
  • Contribution: COM(2021)0420
  • Economic and Social Committee: opinion, report: CES2524/2021
  • Contribution: SWD(2021)0190
  • Contribution: SWD(2021)0191
  • Contribution: COM(2021)0420
  • Contribution: COM(2021)0420
  • Document attached to the procedure: N9-0001/2022
  • Document attached to the procedure: EUR-Lex
  • Document attached to the procedure: SEC(2021)0391
  • Document attached to the procedure: EUR-Lex
  • Document attached to the procedure: SWD(2021)0190
  • Document attached to the procedure: EUR-Lex
  • Document attached to the procedure: SWD(2021)0191
  • Legislative proposal published: COM(2021)0420
  • Legislative proposal published: EUR-Lex
  • Document attached to the procedure: EUR-Lex SEC(2021)0391
  • Document attached to the procedure: EUR-Lex SWD(2021)0190
  • Document attached to the procedure: EUR-Lex SWD(2021)0191
  • Document attached to the procedure: N9-0001/2022
  • Economic and Social Committee: opinion, report: CES2524/2021
  • European Central Bank: opinion, guideline, report: CON/2022/0005 OJ C 210 25.05.2022, p. 0015
  • Committee draft report: PE719.945
  • Amendments tabled in committee: PE734.116
  • Amendments tabled in committee: PE734.117
  • Amendments tabled in committee: PE734.118
  • Text agreed during interinstitutional negotiations: PE759.083
  • Coreper letter confirming interinstitutional agreement: GEDA/A/(2024)000995
  • Text adopted by Parliament, 1st reading/single reading: T9-0365/2024
  • Draft final act: 00036/2024/LEX
  • Contribution: COM(2021)0420
  • Contribution: COM(2021)0420
  • Contribution: SWD(2021)0190
  • Contribution: SWD(2021)0191
  • Contribution: COM(2021)0420

Votes

A9-0151/2023 – Eero Heinäluoma, Damien Carême – Provisional agreement – Am 329 #

2024/04/24 Outcome: +: 479, -: 61, 0: 32
FR DE ES IT RO SE NL BE HU BG FI PT CZ AT HR EL DK SK SI LT LV IE LU EE MT PL
Total
69
79
53
46
21
19
27
21
14
13
13
17
21
17
11
12
11
12
7
9
8
12
6
7
4
43
icon: PPE PPE
145

Hungary PPE

1

Denmark PPE

For (1)

1

Slovenia PPE

3

Luxembourg PPE

2

Estonia PPE

For (1)

1

Malta PPE

For (1)

1
icon: S&D S&D
110

Romania S&D

2

Belgium S&D

2

Bulgaria S&D

2

Czechia S&D

For (1)

1

Greece S&D

1

Denmark S&D

2

Slovakia S&D

For (1)

1

Slovenia S&D

2

Lithuania S&D

2

Latvia S&D

2

Luxembourg S&D

For (1)

1

Estonia S&D

2
icon: Renew Renew
89

Sweden Renew

2

Hungary Renew

For (1)

1

Bulgaria Renew

2

Finland Renew

3

Austria Renew

Abstain (1)

1

Croatia Renew

For (1)

1

Greece Renew

1

Slovenia Renew

2

Latvia Renew

For (1)

1

Ireland Renew

2

Luxembourg Renew

2

Estonia Renew

3

Poland Renew

1
icon: Verts/ALE Verts/ALE
65

Spain Verts/ALE

3

Italy Verts/ALE

2

Sweden Verts/ALE

3

Netherlands Verts/ALE

3

Belgium Verts/ALE

3

Finland Verts/ALE

3

Portugal Verts/ALE

1

Czechia Verts/ALE

3

Austria Verts/ALE

3

Denmark Verts/ALE

For (1)

1

Lithuania Verts/ALE

2

Ireland Verts/ALE

2

Luxembourg Verts/ALE

For (1)

1

Poland Verts/ALE

For (1)

1
icon: The Left The Left
31

Belgium The Left

For (1)

1

Finland The Left

For (1)

1

Portugal The Left

4

Czechia The Left

Abstain (1)

1

Greece The Left

2

Denmark The Left

1

Ireland The Left

For (1)

4
icon: NI NI
31

France NI

For (1)

3

Germany NI

For (1)

1

Spain NI

1

Romania NI

For (1)

1

Netherlands NI

Against (1)

1

Belgium NI

For (1)

1

Czechia NI

For (1)

1

Croatia NI

Against (1)

2

Greece NI

For (1)

Against (1)

2

Latvia NI

Against (1)

1
icon: ID ID
43

Czechia ID

Against (1)

1

Austria ID

Against (2)

2

Denmark ID

Against (1)

1

Estonia ID

Against (1)

1
icon: ECR ECR
58

France ECR

Against (1)

1

Germany ECR

1

Romania ECR

1

Sweden ECR

For (1)

3

Netherlands ECR

Abstain (1)

5

Bulgaria ECR

2

Finland ECR

1

Croatia ECR

1

Greece ECR

Abstain (1)

1

Slovakia ECR

Abstain (1)

1

Lithuania ECR

Against (1)

1

Latvia ECR

For (1)

1
AmendmentsDossier
864 2021/0239(COD)
2022/06/22 ECON, LIBE 4 amendments...
source: 734.116
2022/07/04 ECON, LIBE 288 amendments...
source: 734.116
2022/07/05 ECON, LIBE 572 amendments...