Legal Arrangements Similar to Trusts in Estonia under the EU's Anti-money-laundering Directive

Author:Katrin Sepp
Pages:56-65
SUMMARY

According to EU Directive 2015/849, all Member States must establish a central register of data on ultimate beneficial owners of corporate legal entities and also of trusts and legal arrangements similar to trusts. First of all, this requires identification of the latter arrangements in the individual Member States, which is not an easy task: the definition related to being ‘similar to trusts’ is quite vague.... (see full summary)

 
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56 JURIDICA INTERNATIONAL 26/2017
Katrin Sepp
Doctoral student
University of Tartu
Legal Arrangements
Similar to Trusts in
Estonia under the EU’s
Anti-money-laundering Directive
1. Introduction
To identify terrorists and money-launderers hiding behind legal entities or arrangements, EU Directive
2015/849*1 (4AMLD) introduced the ‘UBO register’. In consequence, all Member States (MSs) have to
establish a central register containing data on ultimate bene cial owners (UBOs)*2 of corporate legal enti-
ties and also of trusts and legal arrangements similar to trusts (hereinafter ‘SAs’).
However, before 4AMLD was transposed into the national law of the various MSs, amendments to it –
referred to by the name ‘5AMLD’ and begun with the European Commission’s ‘Proposal for a Directive of the
European Parliament and of the Council amending Directive (EU) 2015/849 on the prevention of the use
of the nancial system for the purposes of money laundering or terrorist nancing and amending Directive
2009/101/EC of 5 July 2016’ (referred to below as ‘the Proposal’) – were already on the table*3. The nal
tex t of 5AMLD has not yet been agreed on, but it seems rather likely that it is going to usher in some seri-
ous changes pertaining to trusts and SAs. Inter alia, it probably will list such contractual devices as ducie,
Treuhand, and deicomiso as examples of SAs*4. The 4AMLD terms explicitly speci ed only foundations
Directive / of the European Parliament and of the Council of  May  on the prevention of the use of the
nancial system for the purposes of money laundering or terrorist nancing, amending Regulation (EU) No / of
the European Parliament and of the Council, and repealing Directive //EC of the European Parliament and of the
Council and Commission Directive //EC, .., L /.
Generally, ‘any natural person who exercises ownership or control over a legal entity’ (Recital ); more precise de nitions
are given in articles  (on corporations) and  (on trusts and SAs).
Available at http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com///
COM_COM()_EN.pdf (most recently accessed on ..). Since the release of the proposal, the Council of the
EU has published several Presidency compromise texts amending and updating it. Additional parliamentary meetings and
various counterproposals have contributed to the compromise texts. Several committees have reviewed the amendments – e.g.,
the European Economic and Social Committee (EESC) and the Economic and Monetary A airs and Civil Liberties (EMACL)
committees. After the vote by the EMACL group, the European Parliament gave the go-ahead, at the March plenary session,
to start negotiations among said parliament, the Commission, and the Council on the details for the legislation. Voting in
the European Parliament's plenary session is tentatively scheduled for October . See http://www.europarl.europa.eu/
oeil/popups/ cheprocedure.do?reference=/(COD)&l=en (most recently accessed on ..).
See the Proposal (see Note )’s p. , proposed Recital  (p. ), and proposed amendments to Article  (p. ).
https://doi.org/10.12697/JI.2017.26.06

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