WIREDGOV

EU ambassadors recently (01 December 2021) agreed on a mandate to negotiate with the European Parliament on a proposal to update existing rules on information accompanying transfers of funds. The update aims to extend the scope of the rules to certain crypto-assets.

Andrej Šircelj, Slovenian Minister for Finance recently said:

Today’s agreement is an important step towards closing the gaps in our financial systems that are malevolently used by criminals to launder unlawful gains or finance terrorist activities. Crypto-assets are more and more at risk of being exploited for money laundering and criminal purposes, and I’m glad the Council could make swift progress on this urgent proposal.

The aim of the proposal is to introduce an obligation for crypto-asset service providers to collect and make accessible full information about the sender and beneficiary of the transfers of virtual or crypto assets they operate. This is what payment service providers currently do for wire transfers. The purpose is to ensure traceability of crypto-asset transfers, so as to be able to better identify possible suspicious transactions and if necessary blocking them.

The modifications introduced by the Council in its position streamline and clarify the Commission’s proposal, in particular by introducing requirements for crypto-asset transfers between crypto-asset service providers and un-hosted wallets. It also requires that the full set of originator information travel with the crypto-asset transfer, regardless of the transaction amount. Given the urgent need to ensure traceability of crypto-asset transfers, the Council in its position aims to synchronise the application of the proposal on transfer of funds and the market in crypto-assets regulation (MiCA).

Background

This proposal is part of a package of legislative proposals to strengthen the EU's anti-money laundering and countering terrorism financing (AML/CFT) rules, presented by the Commission on 20 July 2021. The package also includes a proposal to create a new EU authority to fight money laundering.

This proposal aligns EU legislation with key standards of the Financial Action Task Force.

• Council negotiating mandate with the European Parliament on information accompanying transfers of funds and certain crypto-assets
• Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on information accompanying transfers of funds and certain crypto-assets (recast)
• Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing the Authority for Anti-Money Laundering and Countering the Financing of Terrorism and amending Regulations (EU) No 1093/2010, (EU) 1094/2010, (EU) 1095/2010
• Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the mechanisms to be put in place by the Member States for the prevention of the use of the financial system for the purposes of money laundering or terrorist financing and repealing Directive (EU) 2015/849
• Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing
• The EU's response to terrorism (background information)

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