EU Parliament to institute additional AML laws

Being part of the EU’s commitment to mitigating fraud and money laundering, the laws include improved due diligence measures and checks on customers’ identities. The institution of the package follows reports of suspicious activities to Financial Intelligence Units and other competent authorities from obliged entities, including banks, assets and crypto assets management, as well as real and virtual estate agents. However, crypto policy observers in the EU underlined that the requirements for digital assets tend to be stricter compared to other financial sectors when the authority uncovered a political deal on the package in January 2024. Crypto sector participants raised concerns due to increased customer verification requirements and measures towards decreasing the risks of transactions involving self-hosted wallets and cross-border transfers.

At that time, the provisional deal aimed to combat money laundering in the cryptocurrency and luxury markets, while also unifying the EU member states’ approaches to mitigating this issue. The agreement focuses on preventing fraudsters, organised crime, and terrorists from legitimising their proceeds via the financial system. Also, to further deter money laundering activities, the deal intended to introduce an EU-wide maximum limit of EUR 10,000 for cash payments.

Furthermore, the newly introduced measures are set to provide both individuals and entities with legitimate interests, including journalists, media professionals, civil society organisations, and other authorities, access to beneficial ownership information kept in national registries and interconnected at the EU level. Prior to the plenary vote, a joint parliamentary committee voted on the text of the package in March 2024, with the three files being fundamental to the EU’s fight against money laundering.

However, to become law, the EU Council, which includes lawmakers from all member states, is required to formally adopt the package. Also, by implementing the law, the EU Parliament aims to respond to the demands of citizens, which put forward proposals on preventing tax evasion and cooperating on corporate taxation.

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