The report:
• provides an overview of Member States’ implementation of EU anti-money laundering (AML) and counter-terrorist financing (CTF) requirements in relation to the issuance, distribution and redemption of electronic money;
• identifies areas where differences in the national implementation of European legislation could affect the integrity of the AML/CTF regime; and
• recommends action by the European Commission to address inadequacies in the legislation and its implementation during the current revisions of the 2nd E-money Directive and 3rd Money Laundering Directive.
Differences in implementation
The report reveals that significant differences existed in the national implementation of the 2nd E-Money Directive (2nd EMD) and in the application of AML/CTF legislation to e-money issuers, their agents and distributors.
These differences are caused by inadequate or ambiguous provisions in the 2nd EMD and 3rd Money Laundering Directive, including such issues as:
• the definition of the point in time where e-money is issued;
• the definition of e-money agents and distributors;
• the application of passporting rules and guidelines to e-money entities; and
• the distribution of powers between home and host AML/CTF supervisors.
Executive Summary
The Joint Committee is a forum for cooperation that was established on 1st January 2011, with the goal of strengthening cooperation between the European Banking Authority, European Securities and Markets Authority and European Insurance and Occupational Pensions Authority, collectively known as the three European Supervisory Authorities. Through the Joint Committee, the three European Supervisory Authorities cooperate regularly and closely and ensure consistency in their practices. One of the areas the Joint Committee works in is regarding measures combating money laundering.
This paper provides an overview of Member States’ implementation of European anti-money laundering and counter-terrorist financing requirements in the context of the issuing, distribution and redemption of electronic money. It describes Member States’ approaches to the Anti-Money Laundering and Counter Terrorist Financing supervision of e-money issuers, their agents and distributors providing services on their domestic territory and/or across the European Union and identifies areas where differences in the national transposition of European legislation could affect the integrity of Europe’s Anti-Money Laundering regime.
The analysis of Member States’ approaches revealed significant differences in Member States’ interpretation of the 2nd E-Money Directive and the treatment of e-money issuers, their agents and distributors for Anti-Money Laundering and Counter Terrorist Financing purposes. These differences are the result of legal uncertainty, caused by insufficient or ambiguous consideration, in the 2nd EMoney Directive and 3rd Money Laundering Directive, of concepts that are key to the understanding and regulation of the electronic money market. These include the definition of the point in time where e-money is issued; the definition of e-money agents and distributors; the application of passporting rules and guidelines to e-money entities; and the distribution of powers between home and host AntiMoney Laundering supervisors.
The Joint Committee considers that the Commission should take the opportunity afforded by the ongoing revisions to the 3rd Money Laundering Directive and 2nd E-Money Directive to address these issues as a matter of priority.
Link to the detailed report : click here