Several EU Member States have been warned of non-compliance with 5th Anti-Money Laundering Directive

The report on infringements of different EU acts committed by some Member States has been published on 14 May 2020 in the website of European Commission. Such infringements include non-compliance of national anti-money laundering and combating terrorist financing (AML/TF) legislation of several Member States with the requirements of the EU Directive 2018/843, which is applicable in the territory of the EU.

In may 2020, the following Member States were notified that not all provisions of EU Directive 2018/843 which must be implemented obligatorily have been transposed to the national laws: Austria, Belgium, Greece, Ireland, Luxembourg, Poland, Czech Republic and Estonia. Also, the same notification has be sent to the United Kingdom, as this state has not completed yet all the steps necessary to exit the EU finally.

Earlier, in January 2020, 8 Member States were warned about their inconsistency with current European AML/TF standards: Cyprus, Hungary, Netherlands, Portugal, Romania, Slovakia, Slovenia and Spain. Both January and May reports do not specify which provisions of the EU Directive 2018/843, also known as 5th Anti-Money Laundering Directive, have not been implemented by some of the states properly. Most probably, obligations to establish the detailed rules of preventing money laundering with the use of electronic assets such as cryptocurrencies and to restrict servicing of shell companies in banks and other financial institutions in the EU have been considered as such.

As prescribed by recently published EU AML/TF Action Plan, all Member States must implement EU rules in this sphere to their legislation effectively and ensure their practical enforceability. This is the very first step to complete mentioned Action Plan, and consequently the following steps will be made in the EU: creation of single rules of the EU Directive 2018/843 application in practice, arrangement of supervision, establishment of co-operation mechanism for Member states, exchange of information and promotion of EU global role in prevention of money laundering in the world.

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