The UK has voted to leave the EU. I am devastated, of course, but that is a personal sadness. From a professional point of view, my concern is what will happen to the AML legislation that we in the UK have already, and what will happen to the new legislation that is making its way towards us. Bearing in mind that I am not a lawyer, my understanding of the situation is quite simplistic – and if you are making big plans for change, you will certainly want to check with a lawyer before doing anything based on my overview.
But – as I understand it – the process of leaving the EU will not start until the UK PM (whoever he or she may be in the coming months) invokes Article 50 of the Lisbon Treaty, which contains the rules for exit. Once that happens, the requirement is for the exit process to be completed within two years.
Until exit is complete, the UK is still fully (politically, financially and legally, if not emotionally) part of the EU, and still covered by the requirements of EU legislation (e.g. the Third Money Laundering Directive, as reflected in the UK’s Money Laundering Regulations 2007).
The transposition of the Fourth Money Laundering Directive into UK legislation – with a transposition deadline of 26 June 2017 – is however in doubt, as the UK government has yet to say what it will do about EU legislation that is only partway through the transposition process. The UK is only the second nation ever to leave the EU, and so models of how it should work are thin on the ground. It may be that the UK – in line with other countries that are not EU anyway, such as Guernsey – will decide to keep the provisions of MLD4. Or it may be that it will decide to plough its own furrow (I should imagine that the beneficial ownership register – the PSC register – is looking a bit rocky at the moment). Or it may be (and I fear that this is the most likely) that the new government will be so overworked, confused and chaotic that AML will drop to such a low point on their agenda that we will not see it again for a decade. But I will keep you posted.