paragraph 3 of AMLAR, AMLA’s objective will be ‘to protect the public interest, the stability and the integrity of the Union’s financial system and the good functioning of the internal market’. To that end, AMLA shall: i. Prevent the use of the Union’s financial system for the purpose of ML/TF, ii. Contribute to identify and assess risks and threats of ML/TF, both across the internal market and those originating from outside the Union, iii. Ensure high-quality AML/CFT supervision, iv. Contribute to supervisory convergence in AML/CFT across the internal market, v. Contribute to the harmonisation of practices in the detection of suspicious flows of monies or activities by Financial Intelligence Units (‘FIUs’), and vi. Support and coordinate the exchange of information between FIUs and between FIUs other competent authorities. With regard to supervision, AMLA will have a dual role: 1) it shall supervise directly a pre-defined number of SOEs, which shall be selected among the obliged entities (‘OEs’) as defined under the AMLR and 2) it shall act as indirect supervisor for the non-selected obliged entities (‘NSOEs’) and more generally as AML/CFT supervisor for the whole financial sector (e.g. by monitoring developments across the internal market in relation to ML/TF, by collecting and analysing information provided by national authorities, etc., as provided for by Article 5 of AMLAR). It should be noted that AMLA shall also have missions relating to FIUs, as well as to the supervision of the non-financial sector. Those missions are not developed hereunder. Direct supervision of SOEs For SOEs, AMLA shall,
paragraph 2 of AMLAR, ensure compliance of SOEs with the requirements applicable to them pursuant to AMLR and to Regulation (EU) 2023/1113 (TFR, please see the dedicated page), carry out supervisory reviews and assessments at the level of individual entities and at group-wide level, participate in group-wide supervision, develop and keep up to date a system to assess the risks and vulnerabilities of the SOEs by means of structured questionnaires and other tools. For SOEs, joint supervisory teams, involving staff from national authorities of the countries where the SOE operates, shall be created. With regard to, the selection of SOEs, as a preliminary step, AMLA will determine how many SOEs it will directly supervise (that number cannot be lower than 40),
Then, as a first step, AMLA, in collaboration with national financial supervisors, shall carry out an assessment for OEs operating in at least six Member States and classify them according to their risk file as either ‘low’, ‘medium’, ‘substantial’ or ‘high’ risk. The methodology for classifying the inherent and residual risk profile shall be established separately by AMLA depending on the categories of OEs (credit institutions, collective investment undertakings, etc.). For each category of OEs, the ‘assessment methodology shall be based on the risk factor categories related to customer, products, services, transactions, delivery channels and geographical areas’. The OEs that have been selected for this assessment and that are classified as high risk (residual) are eligible OEs, i.e. OEs classified as high risk present in at least six Member States. AMLA will then select for the purposes of direct supervision, among the eligible OEs, considering the following criteria: OEs operating in the highest number of Member States, and if this criterion is not sufficient (for instance, if entities number 39, 40 and 41 all operate in the same number of Member States), OEs that have the relatively highest ratio of transactions with third countries (compared to the total volume of transactions). It should be noted that where in a Member State no high-risk OE qualifies as a SOE, an additional selection process shall be carried out by AMLA in that Member State, so that in every Member State at least one entity be directly supervised by AMLA. Indirect supervision by AMLA In addition to the direct supervision competence of AMLA, AMLA shall also indirectly supervise the whole financial sector for AML/CFT purposes. To that end, AMLA shall especially: monitor developments across the internal market and assess threats, vulnerabilities and risks in relation to ML/TF, collect and analyse information, from its own supervisory activities and those of the national competent AML/CFT authorities, on weaknesses identified in the application of AML/CFT rules by OEs, the risk exposure of OEs, the sanctions imposed, and the remedial actions taken, develop, in cooperation with national competent AML/CFT authorities, a harmonised AML/CFT supervisory methodology detailing the risk-based approach regarding supervision, coordinate thematic reviews to be carried out by national authorities at European level, if relevant, establish and keep up to date a central database of AML/CFT information, including e.g. statistical information, information about administrative measures and pecuniary sanctions, etc., facilitate the functioning of the AML/CFT supervisory colleges in the financial sector, contribute, in collaboration with financial supervisors, to the convergence of supervisory practices and the promotion of high supervisory standards in the area of AML/CFT. Fees for the functioning of AMLA The fees levied by AMLA will impact SOEs, as well as NSOEs which ‘operate in at least six Member States, including the home Member State, either through establishments or under the freedom to provide services in the Member States other than the Member State where the [OE]‘s head office is established, regardless of whether the activities are carried out through an infrastructure in their territory or remotely’,
Article 77 paragraph 5 of AMLAR allows national authorities to continue to levy fees on the OEs which will have to pay fees to AMLA, including the SOEs, as the national authorities will be involved in the joint supervisory teams. There will however be coordination between AMLA and national authorities with regards to the level of the fees,
paragraph 4 of AMLAR, indicating that AMLA ‘shall communicate with the relevant financial supervisor before deciding on the final fee level so as to ensure that supervision remains cost-effective and reasonable for all [OEs] in the financial sector.’ For further information on AMLA please refer to the following page of the European Commission website: AMLA – European Commission (europa.eu). 1 Article 2
AI explanation based on the official legal text. Indicative, not a substitute for legal advice.