Commission refers Luxembourg to the Court of Justice for not completely implementing EU anti-money laundering rules

Commission refers Luxembourg to the Court of Justice for not completely implementing EU i anti-money laundering rules

The European Commission decided today to refer Luxembourg to the Court of Justice of the EU for transposing only part of the 4th Anti-Money Laundering Directive (Directive 2015/849) into their national law.

The Commission proposed that the Court charges a lump sum and daily penalties until Luxembourg takes the necessary action.

Věra Jourová i, Commissioner for Justice, Consumers and Gender Equality said: "We have stringent anti-money laundering rules at EU level, but we need all Member States to implement these rules on the ground. We don't want any weak point in the EU that criminals could exploit. The recent scandals have shown that Member States should treat this as a matter of urgency."

Member States had to transpose the Directive into national law by 26 June 2018. The 4^th Anti-Money Laundering Directive reinforces the previously existing rules by:

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  strengthening the risk assessment obligation for banks, lawyers, and accountants;
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  setting clear transparency requirements about beneficial ownership for companies and trusts;
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  facilitating cooperation and exchange of information between Financial Intelligence Units from different Member States to identify and follow suspicious transfers of money to prevent and detect money laundering or terrorist financing;
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  establishing a coherent policy towards non-EU countries that have deficient anti-money laundering and counter-terrorist financing rules;
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  reinforcing the sanctioning powers of competent authorities.

Background

Regarding the 4^th Anti-Money Laundering Directive the Commission has opened so far infringement procedures for non-communication of transposition measures against 21 Member States: three are currently at the stage of court referrals (Romania, Ireland and now Luxembourg), with one on hold (Greece), nine at the stage of Reasoned Opinions, and eight at the stage of Letters of Formal Notice.

Today, the European Commission also sent Estonia and Denmark a reasoned opinion and letter of formal notice respectively as part of this same assessment.

Meanwhile, in the wake of the Panama Papers revelations and the terrorist attacks in Europe, the Commission proposed a 5^th Anti-Money Laundering Directive to further step up the fight against money laundering and terrorist financing. These new rules aim at ensuring a high level of safeguards for financial flows from high-risk third countries, enhancing the access of Financial Intelligence Units to information, creating centralised bank account registers, and tackling terrorist financing risks linked to virtual currencies and pre-paid cards. These new rules entered into force on 9 July 2018 following its publication in the EU's Official Journal and Member States will have to transpose the 5^th Anti-Money Laundering Directive into national legislation by 10 January 2020.

For More Information

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  4th Anti-Money Laundering Directive and Funds Transfer Regulation
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  The Supranational Risk Assessment Report
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  The Staff Working Document on Financial Intelligence Units
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  5^th Anti-Money Laundering Directive and factsheet
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  On the key decisions in the November 2018 infringements package, see full MEMO/18/6247
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  On the general infringements procedure, see MEMO/12/12
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  On the EU infringements procedure

IP/18/6251