On 19 April 2018, the European Parliament adopted the Fifth Anti-Money Laundering Directive (MLD5). In its press release, the European Commission welcome the new measures and states that “ these new rules will bring more transparency to improve the fight against money laundering and terrorist financing across the European Union “.
The proposal was presented by the Commission in July 2016, following some political pressure in the wake of terrorist attacks and the revelations of the Panama Papers scandal, with plans to strengthen rules on money laundering and transparency of financial transactions, and to better counter the financing of terrorism across the EU.
- Enhance the powers of EU financial intelligence units by increasing the information available on the beneficial ownership of companies and trusts;
- Prevent risks associated with the use of virtual currencies for terrorist financing by allowing maximum transaction amounts for electronic money products (e.g. prepaid cards) of EUR 150 when used directly in a shop and of EUR 50 when used online;
- Improve the safeguards for financial transactions to and from high risk third countries by implementing systematic enhanced checks and providing a harmonised list of those countries with low transparency standards or appropriate sanctions;
- Ensure centralised national bank and payment account registers or central data retrieval systems in all Member States, and enhance the access of financial intelligence units to this information; and
- Facilitate cooperation and exchange of information between financial supervisory authorities.
Given the need to urgently implement these measures, the directive must be transposed by Member States into national law within 18 months of the date the text was adopted.
The lack of clarity on how Brexit will be finalised makes UK implementation of MLD5 uncertain. Whilst it is difficult to predict a possible scenario, given the UK’s commitment to anti-money laundering and counter terrorist financing, it is likely that at least similar terms to MLD5 will be implemented.
Here the adopted text of the 5MLD.