The new AML/CFT Package finally adopted by the EU Parliament

In its 2021 report, the EU Commission and the Council undertook a comprehensive analysis of the efficacy and efficiency of the Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) framework throughout the European Union.

The EU Commission’s analysis revealed several significant challenges:

• over the past three decades, the EU’s AML/CFT policy has been established primarily through Anti-Money Laundering Directives, therefore implementation into national legislation is often a drawn-out process and results in significantly contrasting interpretations and practices in AML/CFT regulations across Member States;
• the fragmented nature of the AML/CFT supervisory framework is an obstacle to effectively addressing cross-border risks; and
• the variety in the mandates and capabilities of national supervisory bodies has resulted in inconsistent levels of oversight quality and efficacy across the EU, potentially exposing the single market to systemic risks arising from deficiencies in supervision by individual Member States.

On 20 July 2021, the EU Commission presented an ambitious AML package that aimed to address all of the identified challenges and help to create a much more consistent framework, thus facilitating compliance for operators subject to AML/CFT rules, including for those that are active cross-border.

On 24 April 2024, after years of negotiations and the adoption of the revised Transfer of Funds Regulation,[1] the remaining three pillars of the much-anticipated AML/CFT Package comprising the Anti-Money Laundering Authority Regulation (AMLA Regulation), the sixth directive on AML/CFT (AMLD6) and the long-awaited EU regulation on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (AMLR) have finally been adopted by the EU Parliament.

[1] Regulation (EU) 2023/1113 of the European Parliament and of the Council of 31 May 2023 on information accompanying transfers of funds and certain crypto-assets and amending Directive (EU) 2015/849

The AML/CFT Package will now be adopted by the Council and then published in the Official Journal of the EU. The AML Package will enter into force on the twentieth day following its publication.

The AMLA should assume most of its tasks and powers by mid-2025. Direct supervision of selected obliged entities should commence as of 2028.

The application of the new AMLR is anticipated by mid-2027, except in relation to football agents and professional football clubs in scope, for which it shall apply as of mid-2029.

Member States will start to apply AMLD6 three years following its entry into force at EU level, at the latest. However, rules on access to beneficial ownership registers will start to apply, at the latest, two years following its entry into force of AMLD6 at EU level.