EU chasing AML harmonisation with new rule package

European Parliament requires PSPs to ensure 10 second transfers
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A new package of anti-money laundering rules has been adopted by the European Council, which has been looking for ways to fill gaps in the EU’s financial framework.

The package confirms the creation of an Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA), a long-term proposal endorsed by EU legislators and the European Commission (EC).

Headquartered in Frankfurt, AMLA will conduct direct and indirect supervision over high-risk entities in the financial sector. Formation of AMLA falls in line with the EU’s goal of harmonising AML and counter-terrorist financing CTF rules across the trade block.

In pursuit of this goal, AMLA will work to create an integrated mechanism with the national authorities of the EU’s 27 member states to ensure compliance with AML obligations in the finance sector, and will have a supporting role in the non-financial sector.

Outside of the regulator, the Council’s directive seeks to improve the organisation of national AML systems by setting out rules for how financial intelligence units (FIUs) work together, furthering its goal of ensuring a coordinated approach across the EU’s member states.

Obligated entities included under the AML rules include crypto sector stakeholders, luxury goods traders, football clubs and agents. Tighter due diligence requirements, regulations of beneficial ownership and a €10,000 limit on cash payments will also be introduced.

Vincent Van Peteghem, Belgian Minister for Finance, commented: “The new and stricter rules will strengthen our systems in the fight against money laundering and terrorist financing. 

“A new agency based in Frankfurt will supervise the work of actors involved. This will ensure that fraudsters, organised crime and terrorists will have no space left for legitimising their proceeds through the financial system.”

A second directive will follow this rule package, due to the first directive creating a single access point for centralised bank account registers only available for FIUs. The second directive will create another access point for regulators.

The next steps for the rules will be publication in the EU’s official journey, which will symbolise the entry into force. The regulations will not apply until three years later, however, giving member states time to adapt any national procedures to the requirements.

Although not fully coming into effect for some time, the rules have received a positive reception from relevant sectors. The European Gaming and Betting Association (EGBA), for example, has stated that the regulations will benefit its betting operator members by promoting standardisation and harmonisation across the EU.

EGBA has also drafted guidelines for operators to follow to better adopt the rules. The association has welcomed previous developments in this area, having spoken favourably about the long-running plans for the creation of the AMLA.

Dr. Ekaterina Hartmann, Director of Legal and Regulatory Affairs, EGBA, said: “We welcome the finalisation of the new anti-money laundering package. EGBA has actively followed and contributed to the revision of the AML rules at EU-level and believes the new rules will benefit Europe’s online gambling operators, especially those operating in multiple jurisdictions, by ensuring a single regulatory approach across EU member states. 

“With finalisation of the new rules, EGBA will review and update its industry guidelines on AML to ensure their alignment with the rules. By signing up to the guidelines, operators can begin preparing themselves for the EU rule changes and join our members in their efforts to proactively and positively contribute to the fight against money laundering in the EU.”