- Question ID
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2021_6242
- Legal act
- Directive (EU) 2015/849 (AMLD)
- Topic
- Customer Due Diligence
- Article
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3
- Paragraph
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13
- Subparagraph
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N/A
- COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
- EBA/GL/2021/02 - Guidelines on customer due diligence and the factors institutions should consider when assessing the ML /TF risk associated with individual business relationships and occasional transactions under Articles 17 and 18(4) of AMLD
- Article/Paragraph
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18.8 a)
- Type of submitter
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Law firm
- Subject matter
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Identifying the customer of a PISP
- Question
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Is the assessment of who the customer is, from the perspective of a payment initiation service provider (PISP) with a merchant-facing business model (as referred to in Guideline 18.8 a) of EBA/GL/2021/02), affected by the frequency with which a single payer uses the PISP’s services?
- Background on the question
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Guideline 18.8 a) of the EBA ML/TF risk factor Guidelines (EBA/GL/2021/02) provides guidance on how PISPs should determine who their customers are. In the Guideline, it is stated that:
The customer is: a) For PISPs: the customer is the natural or legal person who holds the payment account and requests the initiation of a payment order from that account. In the specific case where the PISP has a business relationship in the meaning of Article 3(13) of Directive (EU) 2015/849 with the payee for offering payment initiation services, and not with the payer, and the payer uses the respective PISP to initiate a single or one-off transaction to the respective payee, the PISPs’ customer for the purpose of these Guidelines is the payee, and not the payer. This is without prejudice to Article 11 of Directive (EU) 2015/849 and Title I of these guidelines especially with regards to occasional transactions, and the PISPs’ obligations under Directive (EU) 2015/2366 and other applicable EU legislation.
This Guideline was amended as part of the development of the Guidelines and the final Guideline was drafted in a manner intended to ensure adequate proportionality and fair recognition of the fact that there are different business models applied by PISPs, not all of which include treating payers as customers (see p. 10 of the EBA’s final report to the ML/TF risk factor Guidelines).
- Submission date
- Final publishing date
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- Final answer
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In the case described by the submitter, to determine whether the payment initiation service provider (PISP) has a business relationship with the payer, the PISP should refer to paragraphs 4.7 and 18.8 a) of the ML/TF risk factor Guidelines (EBA/GL/2021/02) (the ‘guidelines’).
Pursuant to paragraph 18.8 a) of the guidelines, in the case where the PISP has a business relationship in the meaning of Article 3(13) of Directive (EU) 2015/849 (the ‘AMLD’) with the payee for offering payment initiation services, and the payer only uses the respective PISP to initiate a single or one-off transaction to the payee, the PISPs’ customer is the payee, and not the payer. This is without prejudice to Article 11 of the AMLD and Title I of the guidelines, especially with regards to occasional transactions.
Paragraph 4.7 b) (which is part of Title I of the guidelines) indicates that it is firms’ responsibility to set out in their policies and procedures what constitutes an occasional transaction in the context of their business and at what point a series of single or one-off transactions amounts to a business relationship, rather than an occasional transaction. To do so, firms should take into consideration factors such as the frequency and regularity with which the customer returns for occasional transactions, and the extent to which the relationship is expected to have, or appears to have, an element of duration.
This means that, where the PISP has a business relationship with the payee and the payer only uses the PISP to initiate a single or one-off transaction, then in principle the PISP does not have a business relationship with the payer. However, if the payer repeatedly returns for single or one-off transactions, then these transactions may at some point amount to a business relationship.
To determine whether this is the case, the frequency and regularity with which the customer returns for single or one-off transactions are key factors that should be taken into consideration by the PISP.
Consequently, in the case described by the submitter, the assessment of the existence of a business relationship between the PISP and the payer should be affected by the frequency and regularity with which the payer uses the PISP’s services.
It is the PISP’s responsibility to set out in its policies and procedures the way in which the frequency and regularity with which the payer returns for single or one-off transactions should affect its assessment of the existence of a business relationship with the payer, taking into account factors such as the specificities of its business, the level of ML/TF risks associated with the transactions initiated by the payer, and provisions from applicable national legislation.
- Status
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Final Q&A
- Answer prepared by
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Answer prepared by the EBA.