The Council of the European Union has adopted a package of new rules on anti-money laundering and countering the financing of terrorism (EU’s rules on anti-money laundering and countering the financing of terrorism (AML/CFT)), which harmonizes the rules across the EU for the first time. The package was published in the Official Journal of the European Union on June 19, 2024 and contains two regulations and a directive (AMLD). The Regulation establishing the Anti-Money Laundering and Countering the Financing of Terrorism Authority (AMLAR) creates the new European Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA). AMLA will be based in Frankfurt, will begin its work in mid-2025 and should be fully operational by 2027. The authority was officially founded on June 26.
The Anti-Money Laundering Regulation (AMLR) harmonizes all regulations for the private sector in order to close legal loopholes for fraud.
The directive is intended to improve the organization of national anti-money laundering systems. Member states are obliged to collect, standardize and publish data on AML and CFT measures. It extends AML regulations to new obliged entities, tightens due diligence obligations, regulates beneficial ownership and sets a limit for cash payments. It also sets out clear rules for cooperation between national anti-money laundering systems, which collect information on suspicious or unusual financial activities, and supervisory authorities.
AMLA will have both direct and indirect supervisory powers over high-risk companies in the financial sector. The authority will also support the non-financial sector by coordinating and supervising national anti-money laundering systems. In the event of serious, systematic or repeated violations of directly applicable regulations, the AMLA will impose financial sanctions on the selected companies.
This is the final step in the acceptance procedure. The AML regulation will apply for three years after its entry into force. Member states have two years to implement some parts of the AML regulation and three years for other areas. The AMLA is expected to issue regulatory technical standards on certain aspects of the AMLR and AMLD from 2025.
