New EU anti-money laundering legislation comes into force

Written by Martin Banks on 3 January 2018 in News

As of 1 January, national tax authorities will have direct access to information on the beneficial owners of companies, trusts and other entities, as well as customer due diligence records of companies.

Photo credit: Press Association

The European Commission has welcomed the entry into force of new rules obliging member states to give tax authorities access to data collected under anti-money laundering legislation.

As of 1 January, national tax authorities will have direct access to information on the beneficial owners of companies, trusts and other entities, as well as customer due diligence records of companies.

The new arrangements should give a major boost to tax authorities in the fight against the types of structures highlighted in the Paradise Papers.

Speaking in Brussels on Wednesday, Pierre Moscovici, European Commissioner for economic and financial affairs, taxation and customs, said, “We want to give tax authorities crucial information on the individuals behind any company or trust.”


He told reporters, “This is essential for them to be able to identify and clamp down on tax evaders. To do this, tax authorities will now have access to anti-money laundering information.”

The new amended rules, enshrined in the directive on administrative cooperation, will, he said, give tax authorities much-needed access and enable them to react quickly and efficiently to cases of tax evasion and avoidance.

The move comes after the European Parliament, Commission and Council successfully concluded trilogue negotiations on the revision to the anti-money laundering directive before Christmas.

The deal was slightly delayed because all parties at the negotiating table had to make final checks before they could give their final consent.  The revised legislation includes a series of important measures for cracking down on money laundering, including the creation of ultimate beneficial ownership registers.

Judith Sargentini,Greens/EFA member of the civil liberties, justice and home affairs committee and co-rapporteur for the European Parliament, has also welcomed the new rules.

She said, “I am delighted we have finally reached a deal on this crucial piece of legislation which will deliver tangible benefits to EU citizens.

“Every year, national governments lose billions to money laundering, with painful consequences for public spending.

“These new measures will help make sure that criminals can’t siphon money away from the real economy. This will mean more money will be available for investment in schools, hospitals and other public services.

“With this agreement, the EU gives a clear response to the problems signalled in the Panama Papers and Paradise papers. Public access to ultimate beneficial ownership registers will be a crucial tool in the fight against money laundering, terrorism financing, tax evasion and avoidance.

“Bringing out into the open the identities of the people hiding behind the opaque structures of companies and trusts will make it much easier to identify and prevent criminal behaviour.

"The benefits will not just be felt in Europe. Combatting money laundering will support developing countries that currently miss out on crucial revenue due to illicit activity.”

About the author

Martin Banks is a senior reporter for the Parliament Magazine

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