Anti Money Laundering (AML)
Is used in the context of the fight against so-called "money laundering".
The rights and obligations are regulated by Act No 297/2008 Coll., On Selected Measures against the Legitimisation of Proceeds of Crime and Financing of Terrorism. AML rights and obligations apply to persons who encounter larger amounts of money in the course of their activities and are defined in the law, these are so-called obliged persons such as a bank, accountant, tax advisor, auditor, etc.
An obliged person has several obligations:
• to assess whether the business to be conducted is unusual,
• identify and verify the client,
• to refuse to enter a trade and to withhold an unusual business transaction
• to draw up and update in writing a programme of own activities aimed at combating money laundering and terrorist financing, etc.
The AML Law as amended on 1 November 2020 has introduced several substantial changes such as modifying the scope of application of the AML Law to obliged persons or changes regarding due diligence - the AML Amendment sets out the minimum measures an obliged person will have to take in the case of simplified due diligence (instead of none). This scope has also been extended to so-called "politically exposed persons".
Also, the obligation to ascertain the final beneficiary in the exercise of primary care has been made mandatory. Data and documents on transactions linked to the identification obligation must be kept for at least 10 years after the transaction or the termination of the business relationship if the value of the transaction was EUR 10 000 or more, otherwise for 5 years after the termination of the transaction. An obliged person may be guilty of an administrative offence by failing to comply with the obligation to identify the client and a fine of up to EUR 1 000 000 may be imposed under the law for that administrative offence.
It also introduces an obligation to increase the degree and nature of monitoring of the business relationship to determine whether there is a suspicion that the client is preparing or carrying out an unusual business transaction in the above-mentioned transaction.
If you have any questions regarding AML, please do not hesitate to contact our Tax department at Crowe Slovakia.
An obliged person has several obligations:
• to assess whether the business to be conducted is unusual,
• identify and verify the client,
• to refuse to enter a trade and to withhold an unusual business transaction
• to draw up and update in writing a programme of own activities aimed at combating money laundering and terrorist financing, etc.
The AML Law as amended on 1 November 2020 has introduced several substantial changes such as modifying the scope of application of the AML Law to obliged persons or changes regarding due diligence - the AML Amendment sets out the minimum measures an obliged person will have to take in the case of simplified due diligence (instead of none). This scope has also been extended to so-called "politically exposed persons".
Also, the obligation to ascertain the final beneficiary in the exercise of primary care has been made mandatory. Data and documents on transactions linked to the identification obligation must be kept for at least 10 years after the transaction or the termination of the business relationship if the value of the transaction was EUR 10 000 or more, otherwise for 5 years after the termination of the transaction. An obliged person may be guilty of an administrative offence by failing to comply with the obligation to identify the client and a fine of up to EUR 1 000 000 may be imposed under the law for that administrative offence.
It also introduces an obligation to increase the degree and nature of monitoring of the business relationship to determine whether there is a suspicion that the client is preparing or carrying out an unusual business transaction in the above-mentioned transaction.
If you have any questions regarding AML, please do not hesitate to contact our Tax department at Crowe Slovakia.