The Ministry plans to introduce new obligations for entrepreneurs – a draft amendment to the Act on Counteracting Money Laundering.

The draft Act on Counteracting Money Laundering, prepared by the Ministry of Finance, introduces a number of additional obligations for obliged institutions. The changes will concern, among others, the application of financial security measures, the fulfilment of new reporting obligations, and the execution of so-called “complex transactions”. Businesses should prepare for the need to implement extensive systemic improvements and redefine their operational models.

The amendment to the Act indicates that financial security measures must be applied, for instance, in the event of a change in the nature or circumstances of a business relationship, or if there is a change in the data of a client or a beneficial owner. It is worth noting that the current wording of the Act does not clarify what kind of changes to client data would require a reassessment of the client’s risk profile. The new provisions may therefore suggest the need to apply the full scope of financial security measures even in the case of minor changes that do not affect the money laundering risk level. This represents a significant shift in the approach to applying financial security measures to counterparties and may significantly slow down the initiation of business relationships and the execution of transactions. Financial security measures include, for example, the identification and verification of the identity of the client and the beneficial owner, as well as the ongoing monitoring of transactions to determine the final risk level of the client.

The Ministry’s draft also emphasises the responsibility of obliged institutions to monitor changes in client and beneficial owner data. It is currently common for obliged institutions to include contractual clauses requiring clients to notify them of any such changes. However, one must remember that the responsibility for the accuracy of client data lies with the obliged institution. It is also required that obliged institutions define the method for periodically verifying this information. From the perspective of entrepreneurs, the most cost-effective solution may prove to be the use of technologies that automatically compare client and beneficial owner data held by the institution with data from commercial registers and the Central Register of Beneficial Owners (CRBR).

Unfortunately, although the register provides open access to beneficial ownership information—facilitating the identification of ownership structures—the amended Act states that the register cannot be treated as the sole reliable source of information. Firms will be obliged to continuously monitor the consistency of CRBR entries with the data they hold, thereby verifying their accuracy. Rather than assisting companies in complying with statutory obligations, the register will impose even more responsibilities on them.

Beneficial owners will also be required to provide documents and information necessary for proper notification to the CRBR. According to the authors of the draft, this is intended to facilitate the acquisition of information from groups controlling Polish companies.

The draft also introduces two new categories of transactions: “complex” and “carried out in an unusual manner”. These will require the application of enhanced financial security measures. However, the draft does not currently include examples of such transactions, which means that the burden of classification will fall on the obliged institutions. They should also attempt to clarify the circumstances of the transaction and intensify the financial security measures related to the ongoing monitoring of the business relationship with the client.

At present, obliged institutions are required to apply enhanced financial security measures in relation to clients from high-risk third countries, as identified in delegated acts adopted by the European Commission, or that are based in such countries, excluding, for example, branches of obliged institutions. According to the draft amendment, the obligation to apply enhanced financial security measures will apply to any transaction or business relationship linked to a high-risk third country. The proposed catalogue of such measures includes, among others, the collection of “additional information” about the client and the beneficial owner, the expected nature of the business relationship, and the reasons and circumstances of the transaction. However, no specific examples of “additional information” are provided. This wording could be interpreted as limiting the risk-based approach to merely selecting appropriate financial security measures. The aim of this provision is to further safeguard the financial system of the European Union against the inflow of funds originating from illegal sources outside its borders.