What the EU is doing and why
It is essential that gatekeepers (banks and other obliged entities) apply measures to prevent money laundering and terrorist financing. Traceability of financial information has an important deterrent effect.
The European Commission carries out risk assessments in order to identify and respond to risks affecting the EU internal market.The European Union adopted robust legislation to fight against money laundering and terrorist financing. The first anti-money laundering Directive was adopted in 1990 in order to prevent the misuse of the financial system for the purpose of money laundering. It provides that obliged entities shall apply customer due diligence requirements when entering into a business relationship (i.e. identify and verify the identity of clients, monitor transactions and report suspicious transactions).
The EU laws have been constantly revised in order to mitigate new risks relating to money laundering and terrorist financing.
The legislative framework not only covers a range of areas posing such risks, including virtual assets and crowdfunding, but also complements other regulations such as Markets in Crypto-Assets Regulation (MiCA).
The new Regulation on the Traceability of Transfers of Funds (TFR) ensures the traceability of crypto-assets transfers and the authentication of users, aligning with FATF standards. It will apply as of December 2024.
The Commission ensures effective application of this legislation by reviewing transposition of EU law and cooperating with competent authorities.
Terrorists and criminals have demonstrated their ability to transfer funds quickly between different banks, often in different countries, but lack of timely access to financial information means that many investigations come to a dead end. There is therefore a clear need to enhance cooperation between authorities responsible for combating terrorism and serious crime when financial information is a key part of an investigation.
Directive (EU) 2019/1153 enhances the use of financial information by giving law-enforcement authorities direct access to information about the identity of bank-account holders contained in national centralised registries. In addition, it gives law enforcement the possibility to access certain information from national Financial Intelligence Units (FIUs) – including data on financial transactions – and also improves the information exchange between FIUs as well as their access to law enforcement information necessary for the performance of their tasks. These measures will speed up criminal investigations and enable authorities to combat cross-border crime more effectively.
The Commission publishes every year a supranational risk assessment report. It assesses the vulnerability of financial products and services to risks of money laundering and terrorist financing. This risk analysis is conceived as a key tool to identify, analyse and address money laundering and terrorist financing risks in the EU. It aims at providing a comprehensive mapping of risks on all relevant areas, as well as recommendations to Member States, European Supervisory Authorities and obliged entities to mitigate these risks. This risk analysis support Member States and obliged entities when carrying out their respective risk assessments.
The Commission’s services work closely with the European Supervisory Authorities in the implementation of the AML/CFT rules. The joint committee of the European Supervisory Authorities on AML/CFT issues guidelines and opinions to help national competent authorities to understand the regulatory expectations.
As part of its legal obligation stemming from the 4th Anti-Money Laundering Directive the Commission adopted Delegated Regulations in relation to the following regulatory technical standards that have been developed by the European Supervisory Authorities (ESAs)
- Regulatory technical standards for the minimum action and the type of additional measures credit and financial institutions must take to mitigate money laundering and terrorist financing risk in certain third countries
- Regulatory technical standards on the criteria for the appointment of central contact points for electronic money issuers and payment service providers and with rules on their functions
The new Regulation on the Anti-Money Laundering Authority (AMLA) will create a new EU authority (AMLA). It will transform AML/CFT supervision in the EU and support the cooperation among financial intelligence units (FIUs). Furthermore, it will be the central authority coordinating national authorities to ensure the private sector correctly and consistently applies EU rules.
The new Regulation on the Anti-Money Laundering Authority (AMLA) will create a new EU authority. It will establish a new coordination mechanism for AML/CFT supervision in the EU and support cooperation amongst financial intelligence units (FIUs).
- An Expert Group on Money Laundering and Terrorist Financing meets regularly to share views and help the Commission define policy and draft new legislation
- A Committee on the Prevention of Money Laundering and Terrorist Financing may also be convened to give its opinion on implementing measures put forward by the Commission
- The European Commission also organises meetings of an Expert group (the EU FIU's Platform) that brings Financial Intelligence Units together in order to facilitate cooperation among national FIUs and to provide advice and expertise to the Commission
- The European Commission organises meetings of an Expert Group on eID and remote Know-Your-Customer (KYC) processes that brings public and private experts together to explore issues relating to electronic identification and remote KYC processes to provide advice and expertise to the Commission
Policy making timeline
- 10 January 2024Seat selection procedure - AMLA
- 18 December 2023Call for application - AMLA
- 10 November 2023Call for application - AMLA
The call for applications to Member States came to an end, with applications for the selection of the seat of AMLA received from 9 countries.
- 28 September 2023Call for application - AMLA
At the request of the co-legislators, which have agreed on the selection criteria, the Commission has launched a call for applications to Member States for the selection of the seat of AMLA.
Deadline: 10 November 2023
- 27 October 2022Staff working document - Public-private partnerships
- 29 June 2022Legislation - Transfer of Funds Regulation
The agreement provides for an obligation for all crypto service providers involved in crypto transfers to collect data on the originators and beneficiaries of the crypto-assets transfers they operate, and make them available to the competent authorities in charge of the fight against money laundering and terrorism financing.
- 22 February 2022Manuals - Financial crime
The European Commission presented a trainers’ manual and its corresponding user’s manual for those who train lawyers on anti-money laundering (AML) and counter terrorist financing (CTF) rules at EU level.
- 20 July 2021Legislative proposal - Financial crime
The European Commission presented an ambitious package of legislative proposals to strengthen the EU’s anti-money laundering and countering the financing of terrorism (AML/CFT) rules. The package harmonises AML/CFT rules across the EU. It also proposes the creation of a new EU authority to fight money laundering (AMLA).
- 16 September 2020Report - Trusts and similar legal arrangements
The European Commission adopted a report assessing whether Member States have duly identified and made subject to the obligations of Directive (EU) 2015/849 all trusts and similar legal arrangements governed under their laws. Directive (EU) 2015/849 (the 5th anti-money laundering Directive) indeed extended to trusts and similar legal arrangements the transparency rules and obligations applicable to legal entities, requiring Member States to identify and notify trusts or trust-like arrangements governed under their legal framework.
- 7 May 2020Action plan - Financial crime
The European Commission adopted an action plan for a comprehensive Union policy on preventing money laundering and the financing of terrorism built on six pillars. To gather the views of citizens and stakeholder on these measures, the Commission launched a public consultation in parallel to the adoption of this action plan.
- 24 July 2019Communication - Financial crime
The European Commission adopted a Communication entitled ‘Towards better implementation of the EU's anti-money laundering and countering the financing of terrorism framework’ accompanied by 4 reports.
- 12 September 2018Communication - Anti-money laundering supervision
Communication on strengthening the Union framework for prudential and anti-money laundering supervision, including targeted changes to the three Regulations establishing the Supervisory Authorities.
- 9 July 2018Legislation - AMLD V
Entry into force of the 5th Anti-Money Laundering Directive (Directive (EU) 2018/843), which amends the 4th Anti-Money Laundering Directive.
These amendments introduced substantial improvement to better equip the Union to prevent the financial system from being used for money laundering and for funding terrorist activities.
These amendments were introduced to
- enhance transparency by setting up publicly available registers for companies, trusts and other legal arrangements
- enhance the powers of EU Financial Intelligence Units, and provide them with access to broad information for the carrying out of their tasks
- limit the anonymity related to virtual currencies and wallet providers, but also for pre-paid cards
- broaden the criteria for the assessment of high-risk third countries and improve the safeguards for financial transactions to and from such countries
- set up central bank account registries or retrieval systems in all Member States
- improve the cooperation and enhance of information between anti-money laundering supervisors between them and between them and prudential supervisors and the European Central Bank
- 25 June 2015Legislation - AMLD IV
Entry into force of the 4th Anti-Money Laundering Directive (Directive (EU) 2015/849).
Transposition by EU Member States
- Transposition status of the AMLD V by EU Member States
- Transposition history of the AMLD V by EU Member States
- Text of the AMLD IV (2015/849/EU)
- Summary of the legislation: Preventing abuse of the financial system for money laundering and terrorism purposes
Delegated and implementing acts
Transposition by EU Member States
- The AMLD IV was transposed by all EU Member states into their national law.
- Transposition history of the AMLD IV by EU Member States
- Text of the Use of Financial Information Directive (2019/1153/EU)
- Summary of the legislation: Using financial information for preventing, detecting, investigating and prosecuting criminal offences
Transposition by EU Member States
- Original legislative proposal for the Use of Financial Information Directive
- Impact assessment accompanying the legislative proposal for the Use of Financial Information Directive
- Executive summary of the impact assessment accompanying the legislative proposal for the Use of Financial Information Directive