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July 11, 2017

Will progress be made on the direction of the EU anti-money laundering reform?

By Stephanie Wix

The most recent negotiation between the European Parliament, Council of Member States and European Commission has failed to agree on a deal on the 5th reform of the EU anti-money laundering directive (AMLD).

The European Parliament’s committees on Economic & Monetary Affairs (ECON) and Civil Liberties Justice & Home Affairs (LIBE) voted on the revision of the Anti-Money Laundering Directive on the 28 February to curb money laundering and financial crimes. Since then the European Parliament has been negotiating with the Maltese president to agree on improving the legislation framework.

There are some key disagreements between the European Parliament, the Council and the Commission. The Parliament wants information of beneficial owners to be publicly accessible as well as for trusts to be treated in the same way as companies. However, the Commission wants public registers not to apply to not for profit companies and for the different between public and private trusts to be a relevant factor.

Greens/EFA group financial and economic policy spokesperson Sven Giegold said: “It is unacceptable that member states want trusts to be regulated more lightly than companies even if they serve the same purposes to administer private wealth.”

Nominee directors will not be accepted as beneficial owners, and business relationships must be terminated if a beneficial owner cannot be identified, the Green assessment agreed. The Council however, wants the opposite, for nominee directors to be identified as beneficial owners with no relationship termination.

Also, politically exposed persons (PEPs) should be in public lists in all member states, according to the European Parliament, but the Council suggested that PEPs should not always be subject to enhanced due diligence.

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