EU AML/CFT Package close to final deal
On 18 January 2024, the EU Council and European Parliament reached a provisional agreement on two important pieces of the EU anti-money laundering (AML) and countering the financing of terrorism (CFT) package: the new AML/CFT Regulation (which contains directly applicable rules on Beneficial Ownership) and 6th EU AML/CFT Directive.
The fight against money laundering and financing of terrorism remains an important priority at international, EU and national level for both policymakers and civil society organisations alike, yet international and EU legislation in this field has produced a number of unintended consequences on the work of legitimate public-benefit organisations, including public-benefit foundations. These unintended consequences, which include very cumbersome reporting requirements and the inability to access services due to derisking practices by banks, not only limit organisations’ ability to provide humanitarian assistance, social support, aid in the education and culture fields, and contribute to the fight against climate change, but also hold governments accountable and fight corruption.
Ever since the Commission presented its proposals for the new EU anti-money laundering and countering the fight of terrorism package in July 2021, Philea has been closely monitoring the legislative process leading to its adoption.
The content of the provisional agreements is not yet public. Although it seems that at least some of Philea’s and the wider civil society’s concerns were taken on board, for example the exclusion of beneficiaries from the category of beneficial owners, this will need to be confirmed once the texts are approved by member states’ representatives in the Committee of permanent representatives (COREPER) and the European Parliament.
Once approved, the legislative texts will be published in the EU’s Official Journal and enter into force, at which point Philea will work on a detailed briefing of the package.
Update of Supra National Risk Assessment (SNRA) by European Commission
Another area where the EU is moving on the AML/CFT agenda is the update of the third edition of its 2022 Supranational Risk Assessment Report (SNRA) regarding the “risk of money laundering and terrorist financing affecting the internal market and relating to cross-border activities.” The SNRA, which analyses money laundering and terrorism financing risks and recommends a comprehensive action plan to address them, is made up of a report and a detailed Staff Working Document.
As the Commission seeks input from civil society for the update of Chapter V of the Staff Working Document on non-profit organisations, Philea is bringing together a group of these organisations in order to coordinate their input. If you are interested in being involved, contact Lucia Plantamura.
FATF Private Sector Consultative Forum
The Financial Action Task Force (FATF) Private Sector Consultative Forum (PSCF), which represents the financial sector and other businesses and professions submitted to AML/CFT obligations, will convene in Vienna on 4-5 April. Philea holds a seat at the Forum and will be attending.
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