In July 2021, the European Commission (the Commission) adopted three proposals for regulations and one proposal for a directive of the European Parliament and of the Council in relation to reforms to the EU’s anti-money laundering (AML) and counter-terrorist financing (CTF) regime. The proposals serve to implement aspects of the Commission’s May 2020 action plan in respect of the same, with a view to addressing weaknesses in these areas. The key reforms include a new EU AML and CTF authority and a new EU single AML and CTF rulebook.
On 22 September 2021, the EU’s independent data protection authority, the European Data Protection Supervisor (EDPS), Wojciech Wiewiórowski, published an opinion on the Commission’s proposals, alongside a press release.
Overall, the EDPS’ opinion of the proposals is positive, welcoming the AML package and its objective to increase the effectiveness of AML and CTF. In particular, Mr Wiewiórowski praised the envisaged increased harmonisation of the AML and CTF framework at EU level, which includes the creation of a European authority.
He does, however, set out a number of recommendations for improvements from a data protection perspective, including clearer definition of roles in respect of those involved in the supervision model. He also notes that the risk-based approach adopted by the proposed AML package will require further clarifications to minimise intrusion into individuals’ privacy and full compliance with data protection laws, though he welcomes the approach more broadly.
It is further noted that the AML package should specify what categories of personal data should be processed by obliged entities, and the EDPS strongly recommends that the member states consider adding an express reference to the protection of personal data to the list of risks to be considered by member states.
There is also a call for the legislator to reassess the necessity and proportionality of the extensive proposed access rights for financial intelligence units (FIUs) in regard to access to information related to criminal offences and other financial information.
The deadline for stakeholders responding to the Commission’s July 2021 consultations on the legislative proposals is currently 5 November 2021. However, this deadline has already been extended a number of times from its original date of 17 September 2021. The legislative proposals are expected to be adopted in 2022.