EU Reaches Agreement on AML Authority and Crypto-Asset Proposals
The European Council agreed on its partial position on the proposal for establishing the anti-money laundering and countering the financing of terrorism (AML/CFT) Authority in European Union. The position is partial as the European Council has not yet agreed on the location at which the new Authority will have its seat. Additionally, negotiators from the Council presidency and the European Parliament have reached a provisional agreement on the proposal that updates the rules on information accompanying the transfers of funds by extending the scope of the rules to transfers of crypto-assets.
The introduction of this crypto-asset rule will ensure financial transparency on exchanges in crypto-assets and will provide the European Union with a solid and proportional framework that complies with the most demanding international standards on the exchange of crypto-assets. The aim of this recast is to introduce an obligation for crypto-asset service providers to collect and make accessible certain information about the originator and the beneficiary of the transfers of crypto-assets they operate. The new agreement will enable the European Union to deal with the money laundering and terrorist financing risks that are linked to the new technologies, while reconciling competitiveness, consumer and investor protection, and the protection of the financial integrity of the internal market. The new agreement requires that the full set of originator information travel with the crypto-asset transfer, regardless of the amount of crypto-assets being transacted. There will be specific requirements for crypto-asset transfers between crypto-asset service providers and un-hosted wallets.
Regarding data protection, the co-legislators agreed that the general data protection regulation (GDPR) remains applicable to transfers of funds and that no separate data protection rules will be set up. The improved traceability of transfers of crypto-assets will make it more difficult for persons and entities that are subject to restrictive measures to try to circumvent them. In addition, crypto-asset service providers will have to implement appropriate internal policies, procedures, and controls to mitigate the risks of evasion of national and Union restrictive measures. In due course, member states will have to ensure that all crypto-asset service providers qualify as obliged entities under the fourth Anti-Money Laundering Directive. Co-legislators also agreed on the urgency to ensure traceability of crypto-asset transfers and chose to align the timetable for application of this regulation with that of the markets in crypto assets (MiCA) regulation.
Related Links
Keywords: Europe, EU, Banking, AML CFT, ML TF Risk, MiCA Regulation, Regtech, Securities, MiCA, Crypto-Assets, European Council, European Parliament
Previous Article
Swiss Federal Council Launches Swiss Climate Scores for InvestorsNext Article
FASB Publishes 2021 Agenda Consultation ReportRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
