Money Laundering: Parliament and Council Negotiators Agree on Central Registers

Important progress has been made in negotiations concerning the revision of the Third Anti-Money Laundering (AML) Directive. One of the last points under discussion was the creation of central registers in EU countries listing the ultimate owners of companies. On 16 December agreement was reached between the European Parliament and the European Council on central registers and access to the information to be recorded in them. Access to such information is important for all “obliged entities” (including estate agents) who are required to comply with the terms of the directive.

It can be very difficult in practice to identify the beneficial owners of companies and trusts for which a transaction is executed or an activity carried out. The new rules will for the first time oblige EU member states to maintain central registers listing information on the ultimate beneficial owners of corporate and other legal entities, as well as trusts. The central registers would be accessible to the competent authorities and their financial intelligence units, to “obliged entities” and also to the public. Any person who can demonstrate a “legitimate interest” would also be able to access beneficial ownership information such as the beneficial owner’s name, month and year of birth, national, residency and details on ownership. 

In addition further amendments were agreed on data protection and the rules on “politically-exposed persons” who are seen to be at higher than usual risk of corruption due to the political positions they hold. The agreement on the text as a whole still has to be endorsed by the European Council and Parliament, after which it will be put to a vote by the Parliament next year.