UK and International Tax news
European Parliament Announces New Rules On Money Laundering And Disclosure Of Ultimate Owners Of Companies
Monday 8th June 2015
The European Parliament has recently announced that the ultimate owners of companies will have to be listed in central registers in EU countries, open both to the authorities and to persons with a “legitimate interest”, such as investigative journalists, under new rules already agreed with the Council and endorsed by Parliament.
The fourth anti-money laundering directive (AMLD) will for the first time oblige EU member states to keep central registers of information on the ultimate “beneficial” owners of corporate and other legal entities, as well as trusts. There will also be specific reporting obligations for banks, auditors, lawyers, real estate agents and casinos, on suspicious transactions made by their clients.
The central registers will be accessible to the authorities and their financial intelligence units, without any restriction, to “obliged entities” such as banks carrying out their “customer due diligence” duties, and to the public, although public access may be subject to online registration of the person requesting it and to a fee to cover administrative costs.
To access a register, a person or organisation (including investigative journalists or NGOs) will have to demonstrate a “legitimate interest” in suspected money laundering, terrorist financing and in “predicate” offences that may help to finance them, such as corruption, tax crimes and fraud. These persons may access information such as the beneficial owner’s name, month and year of birth, nationality, country of residence and details of ownership. Any exemption to the access provided by member states will be possible only “on a case-by-case basis, in exceptional circumstances”.
Central register information on trusts will be accessible only to the authorities and “obliged entities”.
The text clarifies the rules on “politically-exposed” persons”, including persons at a higher than usual risk of corruption due to the political positions they hold, such as heads of state, members of government, supreme court judges, and members of parliament, as well as their family members. Where there are high-risk business relationships with such persons, additional measures should be put in place to establish the source of wealth and source of funds involved, says the directive.
MEPs also approved a “transfers of funds” regulation, which aims to improve the traceability of payers and payees and their assets.
Member states will have two years to transpose the AMLD into their national laws. The transfers of funds regulation will be directly applicable in all member states 20 days after its publication in the EU Official Journal.
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