Unpacking the new AML Regulation

Robust anti-money laundering (AML) and combating the financing of terrorism (TF) policies and measures play a vital role in upholding the integrity and stability of the global financial system and the economies of Member States. 

On 19 June 2024, the new AML package was published, with the latest laws adopted by the European Parliament. This legislative package is based on three important legal and regulatory pillars, defining what is expected to be a new and stronger era in the fight against money laundering and terrorist financing. The aim is to strengthen financial systems so that fraudsters, organised crime and terrorists have no room to legitimise their proceeds.  

The new AML package will transfer all rules that apply to the private sector to a new directly applicable regulation, while a directive will address the organisation of national competent authorities that combat money laundering and terrorism financing. 

The new Regulation

The new AML approved package substantially modifies the operational regime for obliged entities, establishing a set of common rules for all Member States in the fight against ML/TF. A new supervisory authority has been created and obliged entities are also being required to fulfil new due diligence requirements for the prevention of money laundering and terrorist financing that will come into force gradually.

New AML Regulatory Pillars

1. New Supervisory Authority

The first legal pillar of the new AML package is based on Regulation (EU) 2024/1620 of the European Parliament and the Council of 31 May, establishing the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (AMLA).

AMLA, which will be based in Frankfurt, must be operational by 31 December 2025. It will intervene in the event of supervisory failures, acting as a central platform for supervisory authorities and mediating disputes between them. 

The creation of the AMLA is clear evidence of the EU’s own recognition of the need to adopt a more harmonised approach to the multiple efforts that the Member States have been making in the context of ML/TF.

2. Improved Systems

The second pillar is implemented by the Regulation (EU) 2024/1624 (AMLR), of the European Parliament and the Council of 31 May 2024, and aims to prevent the use of the financial system for money laundering or terrorist financing.  

In this sense, the anti-money laundering rules have been extended to new obliged entities, such as most of the crypto-asset sector, luxury goods traders, football clubs and agents. It also establishes stricter due diligence requirements and sets a limit of 10,000 euros for cash payments, among other things.

3. Integrated Compliance Mechanims

The third pillar is presented in the Directive (EU) 2024/1640 of the European Parliament and the Council of 31 May 2024 (AMLD VI) and concerns the mechanisms to be put in place by Member States to prevent the use of the financial system for ML/TF purposes.  

Given the cross-border nature of financial crime, the new Authority will contribute to increase the efficiency of the AML/CFT framework by establishing an integrated mechanism with national supervisory authorities to ensure that obliged entities comply with ML/FT-related obligations in the financial sector.  

The new Anti-Money Laundering directive also requires that centralised information on bank account records be available through a single access point in EU Member States.