Contents

Amendments to the law on the prevention of money laundering

Background
The Fourth Directive (EU) on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing (2015/849) has been implemented in Slovakia by the amendment to the Act No. 297/2008 of the ECR on the prevention of the legalisation of the proceeds of crime and terrorist financing. The amendments to the law came into force on 15/03/2018.

Obligated people and the end user of the benefits
In the new regulations, the so-called “obligated people” have first been identified, to whom special obligations have been imposed. These include banks, lawyers, tax consultants, auditors, but also commercial companies that carry out cash transactions in excess of EUR 10,000.00 and legal and individuals who are entitled to broker the sale, rental or sale of real estate.

In the first step, the limit for cash transactions that the obligated people may carry out with their customers was reduced from EUR 15,000.00 to EUR 10,000.00. It was also introduced in case of cash payments of EUR 1,000.00 or more, the customers/clients must always be identified.

Furthermore, every obligated person must draw up a written programme on his own activities against the legalisation of such income by 15/05/2018 at the latest.

The determination of the “beneficial owner” required by the EU Regulation was defined as the determination/review of the “end user of the benefits”. One of the issues to be examined is whether international enforcement measures have already been initiated against the person concerned. The “end user of the benefits” must also be entered in an appropriate register.

With effect from 01/11/2018, all legal entities entered in the Commercial Register (eg commercial companies, non-profit organisations, foundations) must enter the information on the “end users of the benefits”. From this date, the information can be registered in the register. Entries must be made by 31/12/2019 at the latest.

However, registration of the “end-user of the benefits” in the competent register does not replace the obligation to identify and further register end-users in accordance with Act No. 315/2016 of the ECR on the Register of Public Sector Partners. Information on end-users must be regularly updated and kept in the register for a period of five years after the end of the “end-user of the benefits” status.

Sanctions
A person may be fined up to EUR 200,000.00 for a violation of the law and up to EUR 1,000,000.00 for a serious violation. At the same time, the sanctions may be published on the website of the tax office for a period of five years. This should have a significant sanctioning effect for the companies concerned.

Author: Veronika Pinterova