Luxembourg Introduces A Bill Of Law To Implement The 4th Anti-Money Laundering And Terrorist Financing Directive

On 26 April 2017, the Bill of Law n.7128 (Bill of Law), which will implement into national legislation some provisions of the 4th AML Directive and reinforce measures of the Regulation on information accompanying transfers of funds, was introduced to the Chamber of Deputies.

This legal alert will only treat the provisions of the 4th AML Directive that will mainly be implemented by amending the law of 12 November 2004 on the fight against money laundering and terrorist financing (AML Law).

Credit institutions, professionals of the financial and insurance sector, pension funds, management companies, alternative investment fund managers, undertakings for collective investment (UCIs, UCITS, SIFs, RAIFs) and investment companies in risk capital (SICAR), statutory auditors, accountants and accounting professionals, real estate agents, notaries, court bailiffs, lawyers, tax and economic advisers, traders of goods and other obliged entities subject to the AML Law: What will your new obligations be?

The Bill of Law will amend the Luxembourg legal framework to ensure:

The implementation of provisions of the Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (4th AML Directive) that relate to the obliged entities' professional obligations and the monitoring of their respect. The reinforcement of measures of the Regulation (EU) 2015/847 of the Parliament and of the Council of 20 May 2015 on information accompanying transfers of funds (Regulation on information accompanying transfers of funds). Below you will find the main amendments to the AML Law proposed by the Bill of Law.

Scope

The following entities and professionals will explicitly be subject to the AML Law:

Foreign credit institutions and financial institutions when they perform their activities in Luxembourg through branches or simply as free service providers. Every person exercising the Family Office activity. Court bailiffs when they proceed to valuation and public sales of furniture, movables and harvestings. Traders of goods

The amount of cash payments, either made or received, for which traders of goods shall implement the obligations of the AML Law, will be reduced from €15,000 to €10,000.

Professional obligations

Risk based approach

All professionals as defined by the AML Law (Obliged Entities) shall:

Take appropriate steps to identify and...