ECON publishes draft legislation on transfer of funds and cryptoassets

The European Parliament (ECON) has published draft legislation on the proposal for a regulation on information accompanying transfers of funds and certain cryptoassets. The draft sets out the suggested amendments to the wording proposed by the Commission.

Cryptoassets have, until now, been outside of the scope of the Transfer of Funds Regulation (EU) 2015/847, which aims to enhance the traceability of transfers of funds by requiring PSPs to ensure the transmission of information on the payer and the payee throughout the payment chain.

The draft puts forward the following key proposals:

  • removal of the de minimis threshold for cryptoasset transfers;
  • clarification that the Regulation also applies to transfers from or to cryptoasset wallets based on a software or hardware not hosted by a third party (‘un-hosted wallets’);
  • obligation for cryptoasset service providers to obtain information on the source and destination of cryptoassets involved in a transfer;
  • requirements on cryptoasset service providers to conduct counterparty due diligence and protect the confidentiality of personal information;
  • requirement on the EBA to maintain a public register of noncompliant cryptoasset service providers; and
  • ‘fast-tracking’ the recast proposal by linking it to the existing Anti-Money Laundering Directive framework until the new regime enters into force.

Emma Bond