Changes from plenary report to adopted text

Removed(c) collective investment undertakings;

Removed(d) credit providers other than credit institutions;

Removed(e) e-money institutions;

Removed(f) investment firms;

Removed(g) payments service providers;

Removed(h) life insurance undertakings;

Removed(i) life insurance intermediaries;

Removed(j) other financial institutions;

Removed(ja) crypto-asset service providers.

Removed4. For each category of obliged entities referred to in paragraph 3, the benchmarks in the assessment methodology shall be based on the risk factor categories related to customer, products, services, transactions, delivery channels, geographical areas, and the risk management systems put in place by the obliged entities. The benchmarks shall be established for at least the following indicators of residual risk in any Member State they operate in:

Removed(a) with respect to customer-related risk: the share of non-resident customers from third countries, the presence and share of customers identified as Politically Exposed persons (‘PEPs’) and the presence and share of customers located in jurisdictions listed in Annex I to the EU list of non-cooperative jurisdictions for tax purposes, in jurisdictions continuously listed in Annex II to the EU list of non-cooperative jurisdictions for tax purposes for a period of more than three years, and in jurisdictions identified and designated as referred to in Chapter III Section 2 of [please insert reference – proposal for Anti-Money Laundering Regulation];

Removed(b) with respect to products and services offered:

Removed(i) the significance and the trading volume of products and services identified as the most potentially vulnerable to money laundering and terrorist financing risks at the level of the internal market in the supra-national risk assessment or at the level of the country in the national risk assessment;

Removed(ii) the volume of the deposit and payment account services provided under the freedom to provide services, together with other products and services identified as potentially vulnerable to ML/FT risks;

Removed(iii) for money remittance service providers, the significance of aggregate annual emission and reception activity of each remitter in a jurisdiction, in particular those with structural weaknesses in their AML/CFT detection and prevention systems under international standards;

Removed(iiia) the volume of products or transactions that might favour anonymity, including crypto-assets which have in-built anonymisation;

Removed(iiib) the significance of privacy wallets, mixers and tumblers and other anonymising software or techniques used for obfuscating transactions;

Removed(c) with respect to geographical areas:

Removed(i) the annual volume of correspondent banking services, or correspondent crypto-asset services, provided by Union financial sector entities in third countries, in particular those identified as vulnerable in its AML/CFT detection and prevention systems under international standards;

Removed(ii) the number and share of correspondent banking or crypto-asset clients from third countries with structural weaknesses in their AML systems identified by global standard setting bodies;

Removed(iii) the volume of activity of crypto-asset service providers registered or licensed in third countries and operating as financial institutions in the Union.

Removed5. The Authority shall develop draft regulatory technical standards setting out the methodology with the benchmarks referred to in paragraph 4 for classifying the residual risk profile of the obliged entities listed in paragraph 3 in each Member State they operate in as low, medium, substantial or high.

RemovedThe Authority shall submit the draft regulatory technical standards to the Commission by [1 January 2025].

RemovedThe Commission is empowered to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Article 38 of this Regulation.

Removed6. The Authority shall review the benchmarks and methodology at least every three years. Where amendments are required, the Authority shall submit amended draft regulatory technical standards to the Commission.

RemovedThe process of listing selected obliged entities

Removed1. For the first selection process, the 40 obliged entities assessed pursuant to Article 12 that have the highest residual risk profile in at least two Member States shall qualify as a selected obliged entity.

RemovedAs of the second selection process, the number of obliged entities that qualify as a selected obliged entity may be increased by up to 10% in every successive selection process, up to a maximum of 60 selected obliged entities. The Commission shall, to that end, provide an impact assessment taking into account the budgetary impact of such an increase.

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Removed1a. Where in a Member State no established, registered or authorised obliged entity or group thereof qualifies as a selected obliged entity under paragraph 1, the obliged entity or group thereof that has the highest residual risk profile pursuant to the methodology referred to in Article 12(3) shall be designated as a selected obliged entity.

RemovedWhere several obliged entities or groups thereof have a high residual risk profile, the selected obliged entities shall be the ones operating in the highest number of Member States through either establishments or under the freedom to provide services. Where several obliged entities or groups thereof operate in the same number of Member States, the selected obliged entities shall be the ones with the highest ratio of transaction volume with third countries to total transaction volume as measured over the last financial reporting year.

Removed2. The Authority shall commence the first selection process on 1 July 2025 and shall conclude the selection within one month. The selection shall be made every three years after the date of commencement of the first selection, and shall be concluded within one month in each selection period. The list of the selected obliged entities shall be published by the Authority without undue delay upon completion of selection process. The Authority shall commence the direct supervision of the selected obliged entities five months after publication of the list.

Removed3. A selected obliged entity shall remain subject to direct supervision by the Authority as long as the entity is listed under paragraph 2.

RemovedCooperation within the AML/CFT supervisory system for the purposes of direct supervision

Removed1. Without prejudice to the Authority’s power pursuant to Article 20(2), point (g), to receive directly, or have direct access to, information reported, on an ongoing basis, by selected obliged entities, financial supervisors shall provide the Authority with all information necessary for carrying out the tasks conferred on the Authority in accordance with this Regulation and other applicable Union law.

Removed1a. Where an obliged entity becomes a selected obliged entity, the Authority and the national competent authority of the obliged entity shall agree on working arrangements to ensure the smooth transition and conduct of their respective supervisory responsibilities.

Removed2. Where appropriate, financial supervisors shall be responsible for assisting the Authority with the preparation and implementation of any acts relating to the tasks referred to in Article 5(2), point (b), as regards all selected obliged entities, including assistance in verification activities. They shall follow the instructions given by the Authority when performing those tasks.

Removed3. The Authority shall develop implementing technical standards specifying the conditions under which financial supervisors are to assist the Authority pursuant to paragraph 2.

Removed4. The Authority shall submit the draft implementing technical standards to the Commission by 1 January 2025.

RemovedThe Commission is empowered to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 42.

RemovedJoint supervisory teams

Removed1. A joint supervisory team shall be established for the supervision of each selected obliged entity. Each joint supervisory team shall be composed of staff from the Authority and from the financial supervisors responsible for supervision of the selected obliged entity at national level. The members of the joint supervisory team shall be appointed in accordance with paragraph 4 and shall work under the coordination of a designated staff member from the Authority (‘JST coordinator’).

Removed2. The JST coordinator shall be stationed in the Authority´s premises and ensure the coordination of the work within the joint supervisory team. Joint supervisory team members shall follow the JST coordinator’s instructions as regards their tasks in the joint supervisory team. This shall be without prejudice to their tasks and duties within their respective financial supervisors. Unless justified, the JST coordinator shall not be from the Member State where the selected obliged entity is established. ▐

Removed3. The tasks of a joint supervisory team shall include the following:

Removed(a) performing the supervisory reviews and assessments for the selected obliged entities;

Removed(b) performing and coordinating on-site inspections at selected obliged entities and preparing the reports, including proposals for adoption of supervisory measures following such reports, where necessary;

Removed(c) taking into account the reviews, assessments and on-site inspections referred to in points (a) and (b), participating in the preparation of draft decisions applicable to the respective selected obliged entity to be proposed to the General Board and Executive Board;

Removed(d) liaising with financial supervisors where necessary for exercises of supervisory tasks in any Member State where a selected obliged entity is established.

Removed4. The Authority shall be responsible for the establishment and the composition of joint supervisory teams. The Authority and the respective financial supervisors shall appoint one or more persons from their staff as a member or members of a joint supervisory team. A financial supervisor staff member may be appointed to more than one joint supervisory team.

Removed5. The Authority and financial supervisors shall consult each other and agree on the use of staff with regard to the joint supervisory teams.

Removed5a. The Authority shall develop internal procedures setting out the composition of joint supervisory teams, notably with regard to staff from each financial supervisor in a home/host context, the status of staff from national supervisors, the allocation of human resources by the Authority to participate in joint supervisory teams, and necessary operational and procedural rules. The Authority shall ensure that the financial supervisors of the Member States in which the selected obliged entity operates are adequately represented in the joint supervisory team and that the joint supervisory team is composed of staff having a sufficient level and diversity of knowledge, background, expertise and experience.

RemovedRequest for information

Removed1. The Authority may require selected obliged entities, legal persons belonging to them, and, if necessary, natural persons, including their employees, as well as third parties to whom the selected obliged entities have outsourced operational functions or activities and natural or legal persons affiliated to them, to provide all information that is necessary in order to carry out the tasks conferred on it by this Regulation and other applicable Union law.

Removed2. The persons referred to in paragraph 1 or their representatives and, in the case of legal persons or associations having no legal personality, the persons authorised to represent them by law or by their constitution, shall supply the information requested in a timely manner. Lawyers duly authorised to act may supply the information on behalf of their clients. The latter shall remain fully responsible if the information supplied is incomplete, incorrect or misleading.

RemovedThe addressees of a request made pursuant to paragraph 1 shall provide the Authority with clear, accurate and complete information without undue delay.

Removed3. Where the Authority obtains information directly from the natural or legal persons referred to in paragraph 1, it shall make that information available to the financial supervisor concerned.

RemovedGeneral investigations

Removed1. In order to carry out the tasks conferred on it by this Regulation, the Authority may conduct all necessary investigations of any selected obliged entity or any natural or legal person employed by or belonging to a selected obliged entity and established or located in a Member State.

RemovedTo that end, the Authority may: