The European Parliament approved the legislative reform for a more effective fight against money laundering

Emil Radev: The new supervisory body we are creating will be operational next year

The European Parliament gave the green light to the large-scale reform undertaken in the EU for a more effective fight against money laundering and terrorist financing. A key element in the legislative package is the creation of a new supervisory authority, which was backed by MEPs with an overwhelming majority of 482 votes in favour. The rapporteurs on the file for the first time were two Bulgarians – Emil Radev (EPP/GERB) from the Committee on Civil Liberties, Justice and Internal Affairs and his colleague from the Committee on Economic and Monetary Affairs Eva Maria Popcheva (“Renew Europe”), who represents Spain in the EP.

“When we started work on the anti-money laundering and counter-terrorist financing package, it was clear that we were not ready for a fight, we had to fight a war. Today, I am confident that with the new legislation we are giving the EU an arsenal with which to more effectively protect its financial stability”, commented MEP Emil Radev, recalling that dirty financial flows generate billions in losses, and the detection rate of these crimes so far is only 1 %.

“Expectations for the future agency, which will be operational in the middle of next year, are huge. We have managed to provide it with the necessary broad powers and capacity so that it can be a guarantor of more financial security through better cooperation with national supervisory authorities and financial intelligence units in a cross-border environment where risks are constantly growing,” assured Radev. He reported that the new Anti-Money Laundering Authority (AMLA) will directly supervise the riskiest companies in the financial sector, as well as crypto-asset providers that operate in at least 6 member states and have a high residual risk. The agency will also monitor whether they apply the financial sanctions, such as the EU has taken against Russia. AMLA will assist financial intelligence units with the analysis of suspicious transactions and the detection of money laundering cases. The agency will be able to intervene in case of omissions of the national supervisory authorities and play the role of a mediator in cases of misunderstanding between them, and then its decisions will be binding.

“For the effectiveness of the new body, it is important to rely on the increased cooperation with other agencies such as Europol, Eurojust, the European Prosecutor’s Office and the European Anti-Fraud Office”, Emil Radev also pointed out. He defined the participation of the European Parliament in the selection of the seat of AMLA as a historic moment and expressed hope that its role will continue to deepen.

From the rostrum of the EP, the MEP was categorical that there is still work to be done and in today’s very dynamic environment, the legislation should not be viewed as a closed page. “The normative act unites the member states in a common front against dirty money”, declared Radev in conclusion and thanked everyone who participated in the 3-year long difficult legislative process, showing the commitment of the European institutions to find working long-term solutions for more financial security in the EU .

The debates in the plenary hall confirmed the political will to reach a consensus on the legislative package. European Commissioner Mareide McGuinness, who is responsible for financial stability, financial services and the capital markets union, pointed out that the scale of the reform is unprecedented because it concerns all sectors that are at risk and covers the entire legal framework, as well as themselves institutions involved in the fight against money laundering. Maraid McGuinness expressed her satisfaction with the intensive work that made it possible to pass the legislation before the end of the mandate. It was reported that by stopping dirty money, the EU is also countering the violent crimes they finance, such as trafficking in people, arms and drugs, terrorism, etc.

The speakers highlighted the impact of Russian military aggression in Ukraine on the activities of criminal groups in Europe. Criticizing the previous passive approach in the background of high-profile scandals of recent years, they unanimously emphasized the urgent need to fill the “holes” by strengthening supervision, through more cooperation, modernization and harmonization of measures in the Member States.

At the last plenary session for this mandate, the amendments for a wider application of digital tools in company law were also approved, with which Emil Radev was also involved as a reporter. They ease the administrative burden for around 16 million limited liability companies and 2 million collecting societies in the single market and are estimated to save them €437 million a year.