The EBA advises the European Commission on the foundations of the new anti-money laundering/countering the financing of terrorism regime

The European Banking Authority (EBA) today responded to the European Commission’s Call for Advice on the key components of the new anti-money laundering/countering the financing of terrorism (AML/CFT) framework. This advice puts forward a risk-based and proportionate approach that will support the swift and effective start of the Anti-Money Laundry Authority (AMLA) operations.

In March last year, the European Commission asked the EBA to advise it on six regulatory mandates that the new AML Authority, AMLA, will ultimately adopt. This ‘Call for Advice’ related to:

• Draft regulatory technical standards (RTS) on the methodology national supervisors will use to assess the inherent and residual risk profiles of obliged entities;
• Draft RTS on the risk assessment AMLA will use to determine which institutions it will directly supervise;
• Draft RTS on the information obliged entities will have to obtain as part of the customer due diligence process under the new AML/CFT regime;
• Draft RTS on the way supervisors will classify breaches of the new regime by severity, and the criteria they will apply when setting the level of pecuniary sanctions or taking administrative measures, or when imposing periodic penalty payments;
• Preparatory work on two additional mandates relating to information exchange within a group and on the base amounts for pecuniary fines.

Where legally possible, the EBA opted for an approach to regulation that fosters effective and efficient outcomes. This approach was informed through extensive stakeholder consultations and close cooperation with EU competent authorities, thus ensuring that the final recommendations are both robust and operationally sound.

Once adopted by AMLA and endorsed by the European Commission, these instruments will provide a solid foundation for a resilient and effective EU AML/CFT system, in line with AMLA’s mandate and statutory objectives.

Legal basis, background and next steps

The EBA has a legal mandate to contribute to preventing the use of the financial system for the purposes of money laundering and terrorist financing. On 31 December 2025, the EBA will transfer this mandate to AMLA. The EBA will remain responsible for tackling financial crime from a prudential perspective and cooperate closely with AMLA.

The EBA’s work on these six regulatory mandates mentioned above stems from the European Commission’s Call for Advice of 12 March 2024.