Money laundering: EU institutions agree on central registers

On 16 December 2014, the European Parliament (‘EP') and the EU Council have reached political agreement on the revision of the EU AntiMoney Laundering Directive (‘AMLD').

According to the revised draft AMLD, EU Member States would have to maintain central registers listing information on the ultimate beneficial owners of corporate and other legal entities as well as trusts. Such registers would put an end to the anonymity of offshore companies that could be used to shelter obscure financial dealings. The aim is to enhance transparency of business structures and fight money laundering schemes and tax evasion.

Central registers would include beneficial ownership information such as the beneficial owner's name, month and year of birth, nationality, residency and details on ownership. They would be accessible by (i) the competent authorities, (ii) professional individuals or entities entrusted with anti-money laundering obligations such as tax advisers and banks, and (iii) any person or organisation with a ‘legitimate interest' such as investigative journalists and other citizens concerned. Access of the public may be subject to online registration and payment of a fee.

The draft agreement also provides for additional measures on ‘politically-exposed persons', i.e. people at a higher risk of corruption due to the political positions they hold (e.g. heads of State, members of government, Supreme Court judges and members of parliament, their family members). On the basis thereof, the source of wealth and funds may have to be established within the framework of high-risk business relationships with such persons.

The revised draft AMLD would require banks, auditors, lawyers, real estate agents and casinos to be more vigilant about suspicious transactions made by their clients.

The agreement still needs to be formally endorsed by the competent committees of the EP, the EP plenary and the EU Council.

Click here to read the EP press release.