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European Parliament Votes on Anti-Money Laundering Rules
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Anti-money laundering (AML) rules are important in the real estate sector and CEPI takes a strong interest in the revision of the Third Anti-Money Laundering Directive, a proposal for which was published by the European Commission on 5 February 2013.
After much discussion, the European Parliament voted on 11 March in favour of the proposal with a number of amendments. Of particular interest to real estate professionals is the scope of the directive. Estate agents are obliged entities according to the current Third AML Directive. The Commission proposal extends this to include letting agents. The European Parliament’s resolution refers to estate agents including letting agents in so far as they are involved in financial transactions.
There are differences in practice between countries and in some estate agents limit their role to negotiations between parties and do not take part in financial transactions related to property. Therefore this amendment is of potential significance to the requirements imposed on estate agents by the rules on anti-money laundering. The final version of the text will now have to be negotiated with the European Commission and the European Council. A compromise will need to be reached as at present the presidency compromise text refers only to real estate agents. However these negotiations are not expected to be finalised under the current Greek presidency of the EU and are likely to wait until Italy takes over the rotating EU presidency in the second half of this year.
CEPI’s position is that extending the scope of the directive to include letting agents (without definition) is unnecessary and confusing. However limiting the application to situations where such professionals are involved in financial transactions would go a long way to reduce the impact on professionals in the sector. Therefore this is an issue which CEPI will follow carefully.
In addition the Parliament has added to the Commission proposal several requirements a key change being the listing of the ultimate owners of companies and trusts in public registers which would be interconnected throughout the EU. Further information is available at http://www.europarl.europa.eu/news/en/news-room/content/20140307IPR38110/html/Parliament-toughens-up-anti-money-laundering-rules .
There are differences in practice between countries and in some estate agents limit their role to negotiations between parties and do not take part in financial transactions related to property. Therefore this amendment is of potential significance to the requirements imposed on estate agents by the rules on anti-money laundering. The final version of the text will now have to be negotiated with the European Commission and the European Council. A compromise will need to be reached as at present the presidency compromise text refers only to real estate agents. However these negotiations are not expected to be finalised under the current Greek presidency of the EU and are likely to wait until Italy takes over the rotating EU presidency in the second half of this year.
CEPI’s position is that extending the scope of the directive to include letting agents (without definition) is unnecessary and confusing. However limiting the application to situations where such professionals are involved in financial transactions would go a long way to reduce the impact on professionals in the sector. Therefore this is an issue which CEPI will follow carefully.
In addition the Parliament has added to the Commission proposal several requirements a key change being the listing of the ultimate owners of companies and trusts in public registers which would be interconnected throughout the EU. Further information is available at http://www.europarl.europa.eu/news/en/news-room/content/20140307IPR38110/html/Parliament-toughens-up-anti-money-laundering-rules .