Part 4 of our series on the AML package deals with the changes to the group of obligated parties. In future, the group of obligated parties will be regulated in the directly applicable AML Regulation (AML-R).
Compared to the previous legal situation, the following changes in particular will result:
Crypto asset service providers
Crypto Asset Service Providers (CASPs) have been added to the group of financial institutions (Art. 3 para. 6 AML-R). The inclusion of the definition harmonises the legal situation with the entry into force of Markets in Crypto-assets (MiCAR). The previous German regulation of crypto custodians, which are already obliged entities as financial services institutions (Section 2 para. 1 no. 2 GwG), will thus become obsolete.
Gemstone dealers and dealers in luxury goods
Two new categories of traders have been included:
Firstly, Obligated Persons will in future become dealers in precious stones and high-value metals. A list of such valuable metals and precious stones Annex IVa AML-R (for example: Gold, silver, platinum, palladium and rhodium, diamonds, rubies and sapphires).
On the other hand, obliged entities become traders in luxury goods (currently: Art. 3 para. 3 lit. ea) AML-R). The definition of such goods is based on Annex IIIa AML-R. The list currently includes jewellery or gold or silversmith work with a value of more than EUR 10,000, luxury vehicles with a value of more than EUR 250,000 or aircraft with a value of more than EUR 75,000,000.
Crowdunding service providers and crowdfunding intermediaries
The question of the obligation of crowdfunding service providers was discussed for a long time. The EU Commission’s draft still envisaged defining crowdfunding service providers as obliged entities only if they were not licensed as crowdfunding service providers under the European Crowdfunding Services Providers Regulation (Regulation (EU) 2020/1503, ECSPR). It had already become apparent during the negotiations that the Council and Parliament had other ideas. The agreement now goes even further than the proposals in the Council and Parliament’s negotiating positions. “Crowdfunding service providers” and “crowdfunding intermediaries” are now obliged to fulfil this obligation.
Crowdfunding service providers are those within the meaning of Art. 2 para. 1 ECSPR, i.e. licensed crowdfunding service providers (Art. 2 para. 14 b) AML-R).
Crowdfunding intermediaries are service providers that:
- are not crowdfunding service providers, and who
Transactions between- Promoters seeking funding for specific projects, including specific events or causes, or
- Founders seeking funding to finance projects by taking out (interest-bearing and non-interest-bearing) loans or donations
- via an internet-based information system that is accessible to the public or a limited number of investors.
This definition excludes financing via peer-to-peer loans, which do not fall within the scope of the ECSPR, provided that a consumer or natural person does not take out a loan to finance a specific purpose or cause.
However, according to this understanding, brokering is included under Section 2a VermAnlG.
Loan broker
Intermediaries of consumer loans and property loans are also included in the group of obliged entities (Art. 2 (3) (k) AML-R). In order to avoid double supervision, intermediaries acting on behalf of a credit institution granting a loan are excluded. How the feature “[…] carrying out activities under the responsibility of one or more creditors […]” inserted in the trilogue agreements will be interpreted remains unclear at present, as intermediation does not usually require exclusivity or the like, where the lender is responsible for the intermediation service.
Football clubs and players’ agents
Football clubs (Art. 3 para. 3 lit. lc) and players’ agents (Art. 3 para. 3 lit. lb) have been newly included (with publicity). While players’ agents are obligated parties per se, the obligation for football clubs only applies to certain transactions, including transactions with investors or transactions with sponsors. Furthermore, national states can provide for exemptions for particularly small football clubs with low turnover (Art. 4a).
And what about traders in goods?
There are simplifications for goods traders, who were already subject to due diligence obligations under current law only in certain cases. The introduction of the (widely discussed in the media) cash ceiling (see Art. 59 AML-R) means that the obligation to apply due diligence no longer applies.
Conclusion
This overview is only a small selection of the changes. It will only gradually become clear what changes will result in detail for existing obliged entities (such as lawyers who advise on tax matters) or what effects there will be for the “newcomers” to the group of obliged entities.
