The Economic and Monetary Affairs Committee (ECON) has published a draft report on the proposal for a directive amending the Money Laundering Directive (MLD). The salient revisions to the text proposed by the Commission are summarised below.
- Subject persons are to remediate any gaps in existing customer information to bring this in line with the new regime within one year from the date of implementation of the MLDV;
- Exemptions granted in connection with public disclosure of beneficial ownership shall be reassessed at regular intervals to avoid abuse. In addition, when an exemption is granted, this should also be indicated in the public register;
- The previous text proposed by the Commission provided that, for the purposes of the MLD, a trust is to be considered to be administered in each Member State where the trustees are established. The ECON report amends and extends this interpretation by stating that a trust is to be created, administered or operated in a Member State where:
a) it is created according to or governed by the Member State’s law or has its ultimate court of appeal in the Member State’s jurisdiction; or
b) it is connected to the Member State by: i) having one or more of the beneficial owners of the trust resident in that Member State; ii) holding real estate in that Member State; iii) holding shares or voting rights or ownership interest in a legal entity incorporated in that Member State; or iv) holding a bank or payment account in a credit institution situated in that Member State;
- In a continuous push towards individual accountability, Member States shall ensure that where obligations apply to legal persons, penalties can be applied to the members of the management body or to any other individuals who under national law are responsible for the breach.
The position adopted by ECON shall be forwarded to the Council, the Commission and national parliaments. The Commission must refer the matter to the European Parliament again if it intends to amend its proposal substantially or replace it with another text.
The full ECON draft report can be read here.