AML rules even stricter
The transposition of the new EU directive on the prevention of the use of the financial system for money laundering or terrorist financing purposes is far from complete. However, the European Commission has already submitted a proposal further tightening the rules.
The requirements of mentioned (fourth) Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 (the AML Directive), will be transposed into Czech legislation by an amendment to Act No. 253/2008, on Certain Measures against Legalisation of Proceeds from Crime and Terrorist Financing (the AML Act). The amendment to the AML Act is currently waiting to be discussed in the Czech Senate and foresees numerous changes. However, the European Commission is already working on even stricter rules.
For instance, the proposed amendment to the AML Directive considers platforms for the exchange of virtual currencies also to be obliged entities and sets maximum limits for transactions in some prepaid instruments. Apart from that, it empowers some financial intelligence units – in the Czech Republic the Financial Analytical Authority – to request information potentially concerning money laundering and terrorist financing from any obliged entity; under the proposed amendment, financial intelligence units should also be able to obtain information on bank accounts.
The proposed amendment to the AML Directive introduces a new approach also as regards information on beneficial owners, i.e. individuals who may, factually or legally, exercise control over legal entities. The amendment to the Czech AML Act transposing the AML Directive stipulates the record keeping of beneficial owner information as an auxiliary tool to meet an obliged entity’s duties under the AML Act. Although the records will be kept within the existing public register system maintained by the registration courts, they will not be publicly available at the moment; the records will be accessible in a different regime and only to bodies and entities specified by law. However, under the amended AML Directive, beneficial owner information should under certain circumstances and to a limited extent be publicly accessible.
Record keeping of information on beneficial owners of trusts, also required under the AML Directive, is provided for by an amendment to the Civil Code. The deputies practiced more restraint here, and the amendment so far has only passed the second reading, nearly a year since it was first submitted. However, the European Commission has now suggested that member states should implement the legal framework defined by the fourth AML Directive by 1 January 2017 at the latest, so that they can get ready for further changes ahead.