Christmas concord and concensus

Experienced MLROs and other professional AML-ers will be familiar with the pattern of EU AML Directives: in essence, you get a new one every decade.  But thanks to the attacks in Paris in November 2015, and the subsequent realisation that the – at the time – shiny, brand-new MLD4 would not have done anything to prevent the movement of the funds underpinning the attacks, this pattern has accelerated.  Almost immediately a draft MLD5 was issued and trilogue discussions started, between the European Council (the authors of the draft), the European Parliament and the EU Commission.  Still, I panicked not, reasoning that such discussions usually take years.  (In fact, I’m counting on it for Brexit.)

But then came 15 December 2017.  On this date – perhaps keen to beat the festive traffic and get home to the mince pies or the stollen or the panettone – the negotiators came to an unexpected agreement.  Quite what this agreement looks like, we do not yet know, although chances are it’s stained with sherry circles.  But – thanks to the usual crisp summary by the UK Law Society – we do know what were the initial bones of contention when the three parties took their seats at the table:

  • the European Council suggested applying less stringent CDD to EU PEPs (domestic PEPs) than to non-EU PEPs (third country PEPs) – this was strongly opposed by the European Parliament
  • the European Data Protection Supervisor expressed concern about the conflict between beneficial ownership registers and people’s rights to privacy and data protection
  • the European Parliament suggested lowering the definition of beneficial ownership of a corporate entity from 25% to 10% – this was opposed by the European Council
  • the European Parliament said that the European Commission should consider a wider range of factors than heretofore in determining whether a country is a ‘high risk third country’.

We now wait to see how these matters have been resolved.  Although if it’s anything like the spirited scoring arguments we had during our family Christmas charades tournament, it may be some time before anyone suggests another Directive…

This entry was posted in AML, Legislation, Money laundering and tagged , , , , , , , , . Bookmark the permalink.

2 Responses to Christmas concord and concensus

  1. CDWOS says:

    In the light of the “thorny” issues you outline by resolving to defer everything to 2018 or another date to be agreed??!!

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