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Brussels, 17th October 2001

Money laundering: Commission welcomes conciliation agreement on new Directive

The European Commission has welcomed the approval of a compromise text on the proposal to upgrade the EU's money laundering Directive by the European Parliament's delegation in the conciliation procedure with the EU's Council of Ministers. At its October 17th meeting in Brussels, the delegation voted by 12 votes in favour of the compromise text, with one abstention. As this compromise has already been endorsed by the Member States, the conciliation procedure can be formally closed by an exchange of letters between the Parliament and the Council without the need for a meeting of the Conciliation Committee.

"I am delighted that the European Parliament's delegation has endorsed the compromise brokered by the European Commission on amendments to the money laundering Directive", commented Internal Market Commissioner Frits Bolkestein, who attended the meeting of the Parliamentary delegation. "I am now looking forward to its formal adoption by both the Parliament and the Council of Ministers within the next few weeks."

"The new Directive will be a crucially important measure in the fight against the financing of terrorism and organised crime", Mr Bolkestein added. "At the time, the Union's 1991 money laundering Directive already broke new ground and set an example for other countries to follow. Now the new Directive will once more set an international benchmark for the fight against money laundering. Once the Directive has been formally adopted, I hope that Member States will do their level best to implement the new rules ahead of the 18 month deadline."

Wider scope

The proposed Directive (see IP/99/498) would extend the scope of the current Directive on money laundering (91/308/EEC). In particular, the new Directive would oblige Member States to combat laundering of the proceeds of all serious crime (including fraud against the EU budget), whereas the current Directive's obligations apply only to the proceeds of drug offences. The new proposal would also extend the coverage of the current Directive (limited to the financial sector) to a series of non-financial activities and professions that are vulnerable to misuse by money launderers. Requirements as regards client identification, record keeping and reporting of suspicious transactions would therefore be extended to external accountants and auditors, real estate agents, notaries, lawyers, dealers in high value goods such as precious stones and metals or works of art, auctioneers, transporters of funds and casinos.

The EU's Council of Ministers reached political agreement on the proposal in September 2000, and formally adopted its Common Position on 30 November 2000. However, the Parliament voted a series of amendments to the Common Position at its 5 April 2001 plenary session. These amendments were not accepted by the Council, so that a conciliation procedure had to be convened on 18th September 2001 to seek a compromise. Agreement has now been reached on a compromise.

Under the so-called co-decision procedure established by Article 251 of the EC Treaty, the "joint text" approved by the Conciliation Committee must be adopted within six weeks by an absolute majority of votes cast in a plenary session of the European Parliament and by the Council of Ministers, acting by a qualified majority. The six weeks deadline can be extended to eight weeks on the initiative of either the Parliament or the Council.

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