EMA publications

EMA comments on 4MLD implementation in Latvia

We set out our position on the implementation of customer due diligence and local point of contact provisions in 4MLD in a letter sent to the Latvian Ministry of Finance on 27 September.

The letter made a number of comments similar to those set out in previous responses to other EEA member states. These included:

• Article 12exemption from CDD for some e-money products: we set out a compelling argument for the retention of this provision. While the exemption does not create vulnerabilities, products issued under this Article benefit, for example, the financially excluded segment of the population;
• Articles 15, 16 and Annex IIthat allow SDD for low-risk products; we emphasised the importance of these provisions for EMIs that rely on the risk-based approach under Article 15 to onboard new customers;
• disproportionality of the local point of contact requirement under Article 45(9), highlighting that someone located at the central office (e.g. compliance officer or MLRO) would be more knowledgeable and better able to engage with the Latvian regulator.

Read full letter here.

EMA response to Austrian consultation on 4MLD

We submitted a letter to the Austrian Ministry of Finance on 27 September, welcoming their proposals to no longer include EMIs passporting into Austria on a cross-border basis within the scope of the AML laws.

Although the draft law included the SDD provisions set out in Article 15, it did include the Article 12 e-money exemption. In setting out our arguments, we urged the regulator to consider implementing the exemption.

Regarding the requirement for a local point of contact, we provided arguments similar to those in previous EMA responses to member states’ 4MLD consultations, highlighting that the exchange of information can be facilitated effectively without imposing such a requirement.

The full response can be found here.

The EMA submitted a letter to the Austrian Ministry of Finance on the implementation of 4MLD in Finanzmarkt-Geldwäschegesetz – FM-GwG on 27 September 2016.

View the full letter here

The EMA responded to the Maltese Consultation on the implementation of the Common Reporting Standards (“CRS”) and the US Foreign Account Tax Compliance Act (“FATCA”) on 13 September 2016.

View the full response here

The EMA responded to the Luxembourg Consultation on the implementation of the Common Reporting Standards and the Foreign Account Tax Compliance Act on 16 September 2016.

View the full response here

The EMA responded to the Irish Department of Finance Consultation on implementation of PSD2 on 12 September 2016.

View the full response here

The EMA welcomed an opportunity to provide input to the implementation of 4MLD in Luxembourg, and submitted a letter on 25 August.

The letter set out the EMA’s position on the customer due diligence and local point of contact provisions:

• providing rationale and support for applying the Article 12 e-money exemption from CDD;
• setting out the importance of implementing the Article 15 simplified due diligence provisions as only a limited type of product can benefit from the Article 12 exemption;
• emphasising that someone from an issuer’s home office e.g. MLRO, would be better placed to provide a convenient point of engagement in the context of the local point of contact requirement.

We also commented on the implementation of Fund Transfer Regulation Article 2(5)(b), in support of exercising the member state option to exempt national transactions under EUR 1000 for goods and services where the transaction has a unique identifier.

Full details of the EMA’s letter can be found here.

4MLD implementation: EMA’s letter to Denmark

We continued to provide input to the implementation of 4MLD in different EEA Member States, and submitted a response to the Danish consultation on 18 August.

We welcomed their proposals to implement the simplified due diligence provisions in Article 15 of 4MLD and expressed our views on the exemption from customer due diligence for e-money issuers in Article 12.

We also set out EMA’s position on the local point of contact provision for e-money issuers having distributors in Denmark, strongly discouraging the regulator from applying this requirement.

See the full response of the EMA here.

Application of CRS and FATCA: EMA letters to Luxembourg and Malta 

We sent a letter to the Director of the Luxembourg Tax Administration (l’Administration des Contributions Directes) arguing that payment accounts held by PIs and e-money accounts – whether issued by EMIs or CIs – should be exempt from reporting requirements under both FATCA and the CRS. This is because such payment products do not amount to deposit-taking activity.

In Malta, the FATCA and CRS guidelines state that relevant exclusions in the Banking Act will also influence the scope of the amended ‘Cooperation with other Jurisdictions on Tax Matters Regulations 2015’. However in considering whether an entity is conducting banking or similar business, an assessment of the actual activities will be made to make such a determination. We used these provisions in our letter to the Director General of the International Tax Unit of the Maltese Inland Revenue to argue for the exemption pf PIs, and of EMIs and CIs issuing e-money.

The EMA’s letter can be found here.