EU Anti-Money Laundering Directive and Regulation

Georgios Pavlidis, UNESCO Chair & Jean Monnet Chair, Director of the Jean Monnet Center of Excellence AI-2-TRACE-CRIME, Associate Professor of International and EU Law, Department of Law, Neapolis University Pafos (NUP), Cyprus

‘This book is very well researched and documented. The discussion of the international conventions and international institutions provide useful background on AML policy. The treatment of the 6th Anti-Money Laundering Directive is masterful. It discusses the architecture of European law and the evolution of AML directives. The book discusses how to apply and interpret the AMLD6 and anti-money laundering regulations (AMLR) and is accompanied by useful tables on the interaction of the AMLD6 and the AMLR. The book will be extremely valuable for practitioners, academicians, and policymakers.’

• ContentsIntroduction to the EU Anti-Money Laundering Directive and RegulationPART I COMMENTARY ON THE 6TH ANTI-MONEY LAUNDERING DIRECTIVE1 Article 1: Subject matter2 Article 2: Definitions3 Article 3: Identification of exposed sectors at national level 4 Article 4: Requirements relating to certain service providers 5 Article 5: Requirements relating to the granting of residence rights in exchange for investment 6 Article 6: Checks on the senior management and beneficial owners of certain obliged entities 7 Article 7: Risk assessment at Union level8 Article 8: National risk assessment 9 Article 9: Statistics 10 Article 10: Central beneficial ownership registers11 Article 11: General rules regarding access to beneficial ownership registers by competent authori-ties, self-regulatory bodies, and obliged entities 12 Article 12: Specific access rules to beneficial ownership registers for persons with legitimate interest 13 Article 13: Procedure for the verification and mutual recognition of a legitimate interest to accessbeneficial ownership information 14 Article 14: Templates and procedures 15 Article 15: Exceptions to the access rules to beneficial ownership registers 16 Article 16: Bank account registers and electronic data retrieval systems 17 Article 17: Implementing acts for the interconnection of registers18 Article 18: Single access point to real estate information 19 Article 19: Establishment of the FIU 20 Article 20: Fundamental rights officer 21 Article 21: Access to information 22 Article 22: Responses to requests for information 23 Article 23: Provision of information to supervisors 24 Article 24: Suspension or withholding of consent 25 Article 25: Instructions to monitor transactions or activities26 Article 26: Alerts to obliged entities 27 Article 27: FIU annual report 28 Article 28: Feedback by FIU 29 Article 29: Cooperation between FIUs 30 Article 30: Protected channels of communication 31 Article 31: Exchange of information between FIUs 32 Article 32: Joint analyses33 Article 33: Use by FIUs of information exchanged between them34 Article 34: Consent to further dissemination of information exchanged between FIUs 35 Article 35: Effect of criminal law provisions36 Article 36: Confidentiality of reporting37 Article 37: powers and resources of national supervisors38 Article 38: Supervision of forms of infrastructure of certain intermediaries operating under the free-dom to provide services 39 Article 39: Provision of information to obliged entities 40 Article 40: Risk-based supervision 41 Article 41: Central contact points 42 Article 42: Disclosure to FIUs 43 Article 43: Provision of information to FIUs 44 Article 44: General principles regarding supervisory cooperation 45 Article 45: Provision of information on cross-border activities 46 Article 46: Provisions related to cooperation in the context of group supervision 47 Article 47: Supervisory cooperation regarding obliged entities carrying out cross-border activities 48 Article 48: Exchange of information in relation to implementation of group policies in third countries 26649 Article 49: AML/CFT supervisory colleges in the financial sector 50 Article 50: AML/CFT supervisory colleges in the non-financial sector 51 Article 51: Cooperation with supervisors in third countries 52 Article 52: Oversight of self-regulatory bodies 53 Article 53: General provisions 54 Article 54: Supervisory measures towards establishments of obliged entities and certain activitiescarried out under the freedom to provide services 55 Article 55: Pecuniary sanctions 56 Article 56: Administrative measures 57 Article 57: Periodic penalty payments 58 Article 58: Publication of pecuniary sanctions, administrative measures, and periodic penalty payments 59 Article 59: Exchange of information on pecuniary sanctions and administrative measures 60 Article 60: Reporting of breaches and protection of reporting persons 61 Article 61: General provisions 62 Article 62: Communication of the list of the competent authorities 63 Article 63: Cooperation with AMLA64 Article 64: Cooperation in relation to credit institutions or financial institutions 65 Article 65: Cooperation in relation to auditors 66 Article 66: Cooperation with authorities in charge of implementing targeted financial sanctions 67 Article 67: professional secrecy requirements 68 Article 68: Exchange of information among supervisors and with other authorities69 Article 69: AML/CFT cooperation guidelines 70 Article 70: Processing of certain categories of personal data 71 Article 71: Exercise of the delegation 72 Article 72: Committee procedure 73 Article 73: Transitional management of FIU.n et 74 Article 74: Amendments to Directive (EU) 2015/849 75 Article 75: Amendment to Directive (EU) No 2019/1937 76 Article 76: Review 77 Article 77: Repeal 78 Article 78: Transposition 79 Article 79: Entry into force 80 Article 80: Addressees PART II COMMENTARY ON THE ANTI-MONEY LAUNDERING REGULATION81 Article 1: Subject matter 82 Article 2: Definitions83 Article 3: Obliged entities 84 Article 4: Exemptions for certain providers of gambling services 85 Article 5: Exemptions for certain professional football clubs 86 Article 6: Exemptions for certain financial activities 87 Article 7: Prior notification of exemptions 88 Article 8: Notification of cross-border operations and application of national law 89 Article 9: Scope of internal policies, procedures and controls 90 Article 10: Business-wide risk assessment91 Article 11: Compliance functions 92 Article 12: Awareness of requirements 93 Article 13: Integrity of employees 94 Article 14: Reporting of breaches and protection of reporting persons95 Article 15: Situation of specific employees 96 Article 16: Group-wide requirements 97 Article 17: Branches and subsidiaries in third countries 98 Article 18: Outsourcing 99 Article 19: Application of customer due diligence measures 100 Article 20: Customer due diligence measures 101 Article 21: Inability to comply with the requirement to apply customer due diligence measures 102 Article 22: Identification and verification of the identity of customers and beneficial owners103 Article 23: Timing of the verification of the customer and beneficial owner identity104 Article 24: Reporting of discrepancies with information contained in beneficial ownership registers 105 Article 25: Identification of the purpose and intended nature of a business relationship or occasional transaction 106 Article 26: Ongoing monitoring of the business relationship and monitoring of transactions performed by customers107 Article 27: Temporary measures for customers subject to UN financial sanctions 108 Article 28: Regulatory technical standards on the information necessary for the performance ofcustomer due diligence 109 Article 29: Identification of third countries with significant strategic deficiencies in their nationalAML/CFT regimes 110 Article 30: Identification of third countries with compliance weaknesses in their national AML/CFTregimes 111 Article 31: Identification of third countries posing a specific and serious threat to the Union’s financial system112 Article 32: Guidelines on money laundering and terrorist financing risks, trends, and methods 596113 Article 33: Simplified due diligence measures 114 Article 34: Scope of application of enhanced due diligence measures 115 Article 35: Countermeasures to mitigate money laundering and terrorist financing threats fromoutside the Union 116 Article 36: Specific enhanced due diligence measures for cross-border correspondent relationships 117 Article 37: Specific enhanced due diligence measures for cross-border correspondent relationshipsfor crypto-asset service providers118 Article 38: Specific measures for individual third-country respondent institutions 119 Article 39: Prohibition of correspondent relationships with shell institutions 120 Article 40: Measures to mitigate risks in relation to transactions with a self-hosted address 121 Article 41: Specific provisions regarding applicants for residence by investment schemes122 Article 42: Specific provisions regarding politically exposed persons 123 Article 43: List of prominent public functions 124 Article 44: Politically exposed persons who are beneficiaries of insurance policies 125 Article 45: Measures for persons who cease to be politically exposed persons 126 Article 46: Family members and persons known to be close associates of politically exposed persons127 Article 47: Specifications for the life and other investment-related insurance sector 128 Article 48: General provisions relating to reliance on other obliged entities 129 Article 49: Process of reliance on another obliged entity 130 Article 50: Guidelines on reliance on other obliged entities 131 Article 51: Identification of beneficial owners for legal entities 132 Article 52: Beneficial ownership through ownership interest 133 Article 53: Beneficial ownership through control 134 Article 54: Coexistence of ownership interest and control in the ownership structure 135 Article 55: Ownership structures involving legal arrangements or similar legal entities 136 Article 56: Notifications 137 Article 57: Identification of beneficial owners for legal entities similar to express trusts 138 Article 58: Identification of beneficial owners for express trusts and similar legal arrangements 139 Article 59: Identification of a class of beneficiaries140 Article 60: Identification of objects of a power and default takers in discretionary trusts141 Article 61: Identification of beneficial owners of collective investment undertakings 142 Article 62: Beneficial ownership information 143 Article 63: Obligations of legal entities 144 Article 64: Trustee obligations 145 Article 65: Exceptions to obligations of legal entities and legal arrangements 146 Article 66: Nominee obligations 147 Article 67: Foreign legal entities and foreign legal arrangements148 Article 68: Penalties149 Article 69: Reporting of suspicions 150 Article 70: Specific provisions for reporting of suspicions by certain categories of obliged entities 151 Article 71: Refraining from carrying out transactions 152 Article 72: Disclosure to FIU 153 Article 73: Prohibition of disclosure 154 Article 74: Threshold-based reports of transactions in certain high-value goods 155 Article 75: Exchange of information in the framework of partnerships for information sharing 156 Article 76: Processing of personal data 157 Article 77: Record retention 158 Article 78: Provision of records to competent authorities 159 Article 79: Anonymous accounts and bearer shares and bearer share warrants 160 Article 80: Limits to large cash payments in exchange for goods or services 161 Article 81: Cooperation between FIUs and the EPPO 162 Article 82: Requests for information to the EPPO 163 Article 83: Cooperation between FIUs and OLAF 164 Article 84: Requests for information to OLAF 165 Article 85: Exercise of the delegation 166 Article 86: Committee procedure 167 Article 87: Review 168 Article 88: Reports 169 Article 89: Relation to Directive (EU) 2015/849 170 Article 90: Entry into force and application