Regulation Name: New AML/CFT Laws
Publishing Date: 25 February 2024
Region:  European Union
Agency: European Parliament

In a significant move to fortify the European Union’s arsenal against illicit financial activities, the European Parliament has approved a comprehensive set of laws targeting money laundering and terrorist financing. This legislative package, comprising the sixth Anti-Money Laundering (AML) directive, the EU “single rulebook” regulation, and the Anti-Money Laundering Authority (AMLA) regulation, represents a concerted effort to enhance transparency, bolster enforcement, and mitigate financial risks across the EU.

Central to these reforms is the provision of immediate and unfiltered access to beneficial ownership information for individuals and entities with legitimate interests, including journalists, civil society organizations, and supervisory bodies. This transparency measure, coupled with the inclusion of historical data spanning at least five years in national registries, aims to curb the anonymity often exploited by money launderers and terrorist financiers.

Furthermore, the legislation grants expanded powers to Financial Intelligence Units (FIUs) to analyze and detect suspicious transactions, enabling them to suspend activities associated with money laundering and terrorist financing promptly. Obligated entities, such as banks, asset managers, and real estate agents, will face heightened due diligence requirements, including rigorous identity verification procedures and mandatory reporting of suspicious activities to FIUs.

In a notable expansion of regulatory oversight, professional football clubs engaging in significant financial transactions will now be subject to stringent monitoring and reporting obligations. These measures reflect a proactive approach to mitigating risks associated with high-value transactions in the sports sector, aligning with broader efforts to safeguard the integrity of financial systems.

Additionally, the legislation introduces enhanced vigilance measures targeting ultra-rich individuals and imposes a EUR 10,000 limit on cash payments, with exceptions for non-professional transactions between private individuals. These provisions underscore the EU’s commitment to preventing financial crimes and ensuring compliance with targeted financial sanctions.

To oversee the effective implementation of these measures, the establishment of the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA) in Frankfurt is proposed. AMLA will serve as a central supervisory authority, tasked with monitoring the riskiest financial entities, resolving supervisory disputes, and enforcing targeted financial sanctions.

The adoption of these laws represents a proactive response to the concerns raised by citizens during the Conference on the Future of Europe, particularly regarding tax evasion and corporate taxation. As the legislation progresses towards formal adoption by the Council, the EU reaffirms its commitment to safeguarding financial integrity, combating illicit financial activities, and fostering transparency and accountability across its member states.

Read the full press release here.