{"id":"circulars/cssf-23-842","title":"Circular CSSF 23/842","type":"circular","date":"2023-10-16","kind":"circular","html":"

Circular CSSF 23/842 is a CSSF circular, published 16 October 2023. Subject: Adoption of the revised guidelines, by the EBA, on money laundering and terrorist financing risk factors – complement of Circular CSSF 21/782.

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Legal basis: Law of 12 November 2004 on anti-money laundering.

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Relevant for: AIFMs, AISPs, Central Securities Depositories (CSDs), Credit institutions, Credit servicers, Crowdfunding service providers, Data Reporting Service Providers (DRSPs), E-money institutions, Investment firms, Investment fund managers, Investment funds and vehicles, Management companies - Chapter 15, Management companies - Chapter 16, Other specific authorisations, registrations and information, Part II UCIs, Payment institutions, Payment institutions/electronic money institutions/AISPs, Pension funds, Securitisation undertakings, SICARs, SIFs, Specialised PFS, Support PFS, UCITS, Virtual asset service providers (VASPs).

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Main topic: Financial crime. Keywords: AML/CFT, Terrorist financing.

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Circular CSSF 23/842 Adoption of the revised guidelines, by the EBA, on money laundering and terrorist financing risk factors – complement of Circular CSSF 21/782

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Circular CSSF 23/842 Adoption of the revised guidelines, by the EBA, on money laundering and terrorist financing risk factors – complement of Circular CSSF 21/782 This circular shall apply to credit and financial institutions as defined in Article 1(3) and (3a) of Title I of Chapter 1 of the Law of 12 November 2004 on the fight against money laundering and terrorist financing, as amended.

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Luxembourg, 16 October 2023 Ladies and Gentlemen, The purpose of this circular is to inform you that the CSSF, in its capacity as competent authority, applies the European Banking Authority (“EBA”) guidelines amending (ref. EBA/GL/2023/03) (“amending Guidelines”) the EBA Guidelines on customer due diligence and the factors credit and financial institutions (“professionals”) should consider when assessing the money laundering and terrorist financing (“ML/TF”) risks associated with individual business relationships and occasional transactions (“Guidelines on ML/TF risk factors”) under Articles 17 and 18(4) of Directive (EU) 2015/849 (EBA/GL/2021/02), published on 31 March 2023. Consequently, the CSSF has integrated the amending Guidelines into its administrative practice and regulatory approach with a view to promoting supervisory convergence in this field at European level.

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  1. The Guidelines Indeed, following the publication, in January 2022, of an Opinion of the EBA on “de-risking” 1, which assessed the scale of de-risking in the EU, and the impact of the professionals’ decisions to refuse to enter into or to terminate business relationships with individual customers or categories of customers associated with higher ML/TF risks, among which not-for-profit organisations (NPOs), and the European Commission’s request to the EBA to issue new guidelines on the steps institutions should take to facilitate access to financial services by NPOs, the EBA prepared dedicated amending guidelines (EBA/GL/2023/03) regarding customers that are NPOs. These have now been added as an annex to the Guidelines on ML/TF risk factors and are referred to under Guideline 2 (Identifying ML/TF risk factors – Customer risk factors), paragraph 2.7.(d) of the main body of the Guidelines on ML/TF risk factors, as amended. The purpose of the annex is to support the professionals in their understanding of the specificities of prospective or existing customers that are NPOs. Thus, they clarify the steps that the professionals should undertake to get a good understanding of how an individual NPO is set up and operates and what factors the professionals should consider when assessing the ML/TF risk associated with a business relationship with customers that are NPOs.
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Opinion of the European Banking Authority on ‘de-risking’ – CSSF

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The Guidelines are annexed to this circular and are also available on the EBA’s website at: https://www.eba.europa.eu/sites/default/documents/files/document_library/Publications/Guideline s/2023/1054143/Amending%20GLs%20to%20the%20RFGLs%20in%20relation%20to%20NPOs.p df The consolidated version of the Guidelines on ML/TF risk factors (EBA/GL/2021/02), as amended, is available on the EBA’s website at: https://www.eba.europa.eu/sites/default/documents/files/document_library/Publications/Guideline s/2023/EBA-GL-2023-03/1061654/Guidelines%20ML%20TF%20Risk%20Factors_conslidated.pdf This circular complements Circular CSSF 21/782.

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    Scope of application This circular shall apply to credit and financial institutions as defined in Article 1(3) and (3a) of Title I of Chapter 1 of the Law of 12 November 2004 on the fight against money laundering and terrorist financing, as amended.

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    Date of application The Guidelines introducing the annex are applicable as of 3 November 2023.

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The text above is the opening of the document; the PDF carries the whole.

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Document page, PDF. Source: Commission de Surveillance du Secteur Financier (CSSF), reproduced with the CSSF's consent. The French text prevails.

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