Having been published on 5 June 2015, the latest anti-money laundering Directive (EU) 2015/849 (“AMLD IV”), which shall be transposed into national law and which shall become applicable on 26 June 2017, foresees a stronger framework for combating money laundering and terrorism financing.
On the same date, the revised Wire Transfer Regulation (EU) 2015/847 (“WTR”) was also published in the Official Journal. This regulation sets out the minimum obligations to be fulfilled in order to ensure the traceability of transfer of funds. The WTR will become applicable on the same date as the AMLD IV.
Luxembourg has been a leading country in the early implementation of a number of measures contained in AMLD IV. There are two main novelties of particular interest for the Grand-Duchy.
Firstly, obliged entities incorporated within the territory of a Member State, including trustees, shall obtain and hold adequate, accurate and current information on their beneficial ownership (i.e. those who ultimately own or control a company). Beneficial ownership information shall be stored in a central register located outside the company using, for that purpose, a central database which collects beneficial ownership information (which could be organised under the Trade and Companies Register or another central register). Member States may decide that obliged entities are responsible for filling in the register.
In all cases that information should be made available to (i) competent authorities and Financial Intelligence Units, (ii) obliged entities when taking customer due diligence measures, and (iii) other persons who are able to demonstrate a legitimate interest with respect to money laundering, terrorist financing, and the associated predicate offences, such as corruption, tax crimes and fraud.
Secondly, under AMLD IV, “criminal activity” is considered, among other serious crimes, as all offences, including tax crimes relating to direct and indirect taxes as defined in national law, which are punishable by deprivation of liberty or a detention order for a minimum of more than six months. In the case of Luxembourg, given that the penalty for tax fraud (escroquerie fiscale) is established at a minimum of 1 month, tax fraud would remain out of scope of money laundering. It is very likely, however, that in the course of implementation of AMLD IV, Luxembourg will take specific legal measures (as foreseen in CSSF Circular 15/609) to ensure that tax fraud as a predicate offence is included and thereby render punishable money laundering of tax fraud benefits.