The European Banking Authority (EBA) has published its response to the European Commission's (EC's) proposal to bring virtual currency exchange platforms, pre-paid cards and custodian wallet providers within the scope of the 4th Anti-Money Laundering Directive (4AMLD).

The EC published its proposals on 5 July 2016, although it first announced its action plan for amending the 4AMLD in February this year. Specifically, the EC proposed the following amendments to the 4AMLD:

• to designate virtual currency exchange platforms as obliged entities;
• to set lower maximum transaction limits for certain pre-paid instruments;
• to enable national financial intelligence units (FIUs) to request information on money laundering and terrorist financing from any obliged entity;
• to enable FIUs and competent authorities to identify holders of bank and payment accounts;
• to harmonise the EU approach towards high-risk third countries; and
• to improve access to beneficial ownership information.

Clarification need

The EBA has now called for some of the above amendments to be clarified, in particular the regulatory status of virtual exchange platforms and custodian wallet providers. It added that the competent authorities across the EU “should be equipped with the appropriate tools to be able to effectively supervise the proposed requirements”.

The authority also urges the EC to set deadlines for amending 4AMLD that will facilitate a consistent implementation across the EU.

It also states that “national sanction powers as proposed in the EC's amendments should be retained, while transactions in virtual currencies should remain outside of the scope of the Payment Services Directive”.