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The 5th Anti-Money Laundering Directive compliance date 10th January 2020

Background

  • The 5th AML Directive was adopted by the European Parliament and entered into force on 9th July 2018;
  • Member States now have until 10 January 2020 to implement the new rules into national law;
  • The driver for these changes is as result of and in response to recent terrorist attacks in Europe and the revelations of the Panama Papers scandal;
  • Seeks to address noted gaps in the 4th AML and recent trends in money laundering and terrorist financing; and
  • Addresses the potential money laundering and terrorist financing risks posed by virtual currencies, extending the scope of the European Union’s Regulatory Authority to Virtual Currency Transactions.

 Impact

  • Enhances transparency on the beneficial owners of trusts and companies operating in the EU by making public central registers accessible and available;
  • Creates interconnection of these registers to facilitate cooperation and greater exchange of information between Member States;
  • Enhances the access of financial intelligence Units to information, including centralised bank account registers to facilitate greater cooperation;
  • Enhances cooperation between financial supervisory authorities;
  • Improves the safeguards for financial transactions to and from high risk third countries;
  • Lifts the anonymity of pre-paid cards and limit their use; and 
  • Extends AML rules to virtual currencies, tax related services and traders in works of art.

Timeline

  • Live date for Member States: 10 January 2020

Next Steps

  • Individual Member States are working on national transposition of Directive.

Further Information