Criminal Justice (Money Laundering and Terrorist Financing) Act 2010

PART 4

Provisions Relating to Finance Services Industry, Professional Service Providers and Others

Chapter 1

Interpretation (Part 4)

Annotations:

Editorial Notes:

E11

Part included in definition of “designated enactments” for purposes of Central Bank Act 1942 (22/1942) by Central Bank Act 1942 (22/1942), s. 2(1) and sch. 2 part 1 item 37, as substituted (1.10.2010) by Central Bank Reform Act 2010 (23/2010), s. 14(1) and sch. part 1 items 6 and 82, S.I. No. 469 of 2010.

24.

Definitions.

24.— (1) In this Part—

“barrister” means a practising barrister;

“beneficial owner” has the meaning assigned to it by sections 26 to 30 ;

“business relationship”, in relation to a designated person and a customer of the person, means a business, professional or commercial relationship between the person and the customer that the person expects to be ongoing;

F8 [ business risk assessment has the meaning given to it by section 30A ; ]

F8 [ Capital Requirements Regulation means Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 3 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012; ]

F8 [ collective investment undertaking means

( a ) an undertaking for collective investment in transferable securities authorised in accordance with the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 ( S.I. No. 352 of 2011 ) or otherwise in accordance with the Directive of 2009,

( b ) an alternative investment fund within the meaning of the European Union (Alternative Investment Fund Managers) Regulations 2013 ( S.I. No. 257 of 2013 ),

( c ) a management company authorised in accordance with the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 or otherwise in accordance with the Directive of 2009, or

( d ) an alternative investment fund manager within the meaning of the European Union (Alternative Investment Fund Managers) Regulations 2013; ]

“competent authority” has the meaning assigned to it by sections 60 and 61 ;

F9 [ correspondent relationship means

( a ) the provision of banking services by one bank as the correspondent to another bank as the respondent, including providing a current or other liability account and related services, such as cash management, international funds transfers, cheque clearing, payable-through accounts and foreign exchange services, or

( b ) the relationships between and among credit institutions and financial institutions including where similar services are provided by a correspondent institution to a respondent institution, and including relationships established for securities transactions or funds transfers; ]

“credit institution” means—

F10 [ ( a ) a credit institution within the meaning of point (1) of Article 4(1) of the Capital Requirements Regulation, or ]

( b) An Post in respect of any activity that it carries out, whether as principal or agent, that would render it, or a principal for whom it is an agent, a credit institution as a result of the application of paragraph (a) ;

“customer”—

( a) in relation to an auditor, means—

(i) a body corporate to which the auditor has been appointed as an auditor, or

(ii) in the case of an auditor appointed to audit the accounts of an unincorporated body of persons or of an individual, the unincorporated body or the individual,

( b) in relation to a relevant independent legal professional, includes, in the case of the provision of services by a barrister, a person who is a client of a solicitor seeking advice from the barrister for or on behalf of the client and does not, in that case, include the solicitor, or

( c) in relation to a trust or company service provider, means a person with whom the trust or company service provider has an arrangement to provide services as such a service provider;

“Department” means the Department of Justice, Equality and Law Reform;

“designated accountancy body” means a prescribed accountancy body, within the meaning of Part 2 of the Companies (Auditing and Accounting) Act 2003;

“designated person” has the meaning assigned to it by section 25 ;

F11 [ Directive of 2009 means Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 4 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS); ]

“EEA State” means a state that is a Contracting Party to the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by the Protocol signed at Brussels on 17 March 1993;

F11 [ electronic money means electronic money within the meaning of the European Communities (Electronic Money) Regulations 2011 ( S.I. No. 183 of 2011 ); ]

F12 [ ]

“external accountant” means a person who by way of business provides accountancy services (other than when providing such services to the employer of the person) whether or not the person holds accountancy qualifications or is a member of a designated accountancy body;

F13 [ financial institution means

( a ) an undertaking that carries out one or more of the activities set out at reference numbers 2 to 12, 14 and 15 of the Schedule to the European Union (Capital Requirements) Regulations 2014 ( S.I. No. 158 of 2014 ) or foreign exchange services, but does not include an undertaking

(i) that does not carry out any of the activities set out at those reference numbers other than one or more of the activities set out at reference number 7, and

(ii) whose only customers (if any) are members of the same group as the undertaking,

( b ) an insurance undertaking within the meaning of Regulation 3 of the European Union (Insurance and Reinsurance) Regulations 2015 ( S.I. No. 485 of 2015 ), in so far as it carries out life assurance activities,

( c ) a person, other than a person falling within Regulation 4(1) of the European Union (Markets in Financial Instruments) Regulations 2017 ( S.I. No. 375 of 2017 ), whose regular occupation or business is

(i) the provision to other persons, or the performance, of investment services and activities within the meaning of those Regulations, or

(ii) bidding directly in auctions in accordance with Commission Regulation (EU) No 1031/2010 of 12 November 2010 5 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community on behalf of its clients,

( d ) an investment business firm within the meaning of the Investment Intermediaries Act 1995 (other than a non-life insurance intermediary within the meaning of that Act),

( e ) a collective investment undertaking that markets or otherwise offers its units or shares,

( f ) an insurance intermediary within the meaning of the Insurance Mediation Directive (other than a tied insurance intermediary within the meaning of that Directive) that provides life assurance or other investment-related services, or

( g ) An Post, in respect of any activity it carries out, whether as principal or agent

(i) that would render it, or a principal for whom it is an agent, a financial institution as a result of the application of any of the foregoing paragraphs,

(ii) that is set out at reference number 1 in the Schedule to the European Union (Capital Requirements) Regulations 2014, or

(iii) that would render it, or a principal for whom it is an agent, an investment business firm within the meaning of the Investment Intermediaries Act 1995 (other than a non-life insurance intermediary within the meaning of that Act) if section 2(6) of that Act did not apply; ]

F13 [ group means a group of undertakings which consists of a parent undertaking, its subsidiaries, and the entities in which the parent undertaking or its subsidiaries hold a participation, as well as undertakings linked to each other by a relationship within the meaning of Article 22 of Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 6 on the annual financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC; ]

F11 [ high-risk third country means a jurisdiction identified by the European Commission in accordance with Article 9 of the Fourth Money Laundering Directive; ]

“Insurance Mediation Directive” means Directive 2002/92/EC of the European Parliament and of the Council of 9 December 2002 on insurance mediation 7;

F12 [ ]

“Markets in Financial Instruments Directive” means Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments amending Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the European Parliament and of the Council and repealing Council Directive 93/22/EEC 9;

“member”, in relation to a designated accountancy body, means a member, within the meaning of Part 2 of the Companies (Auditing and Accounting) Act 2003, of a designated accountancy body;

“member”, in relation to the Irish Taxation Institute, means a person who is subject to the professional and ethical standards of the Institute, including its investigation and disciplinary procedures, but does not include a person who is admitted to its membership as a student;

F11 [ monitoring , in relation to a business relationship between a designated person and a customer, means the designated person, on an ongoing basis

( a ) scrutinising transactions, and the source of wealth or of funds for those transactions, undertaken during the relationship in order to determine if the transactions are consistent with the designated person s knowledge of

(i) the customer,

(ii) the customer s business and pattern of transactions, and

(iii) the customer s risk profile (as determined under section 30B),

and

( b ) ensuring that documents, data and information on customers are kept up to date in accordance with its internal policies, controls and procedures adopted in accordance with section 54; ]

F11 [ national risk assessment means the assessment carried out by the State in accordance with paragraph 1 of Article 7 of the Fourth Money Laundering Directive; ]

F14 [ occasional transaction means, in relation to a customer of a designated person where the designated person does not have a business relationship with the customer, a single transaction, or a series of transactions that are or appear to be linked to each other, and

( a ) in a case where the designated person concerned is a person referred to in section 25(1)(h), that the amount of money or the monetary value concerned

(i) paid to the designated person by the customer, or

(ii) paid to the customer by the designated person,

is in aggregate not less than 2,000,

F15 [ ( b ) in a case where the transaction concerned consists of a transfer of funds (within the meaning of Regulation (EU) No. 2015/847 of the European Parliament and of the Council of 20 May 2015 7 ) that the amount of money to be transferred is in aggregate not less than 1,000, ]

F16 [ ( bb ) in a case where the designated person concerned is a person referred to in section 25(1)(i) , that the amount concerned

(i) paid to the designated person by the customer, or

(ii) paid to the customer by the designated person,

is in aggregate not less than 10,000, and ]

( c ) in a case other than one referred to in paragraphs F15 [ (a) , (b) or (bb) ] , that the amount or aggregate of amounts concerned is not less than 15,000; ]

“payment service” has the same meaning as in the Payment Services Directive;

“Payment Services Directive” means Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and 2006/48/EC and repealing Directive 97/5/EC 10;

“professional service provider” means an auditor, external accountant, tax adviser, relevant independent legal professional or trust or company service provider;

“property service provider” means a person who by way of business carries out any of the following services in respect of property located in or outside the State:

( a) the auction of property other than land;

( b) the purchase or sale, by whatever means, of land;

but does not include a service provided by a local authority in the course of the performance of its statutory functions under any statutory provision;

F13 [ public body means an FOI body within the meaning of the Freedom of Information Act 2014 ; ]

F12 [ ]

F13 [ regulated market means

( a ) a regulated market with the meaning of point (21) of Article 4(1) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 8 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU, located within the EEA, or

( b ) a regulated market that subjects companies whose securities are admitted to trading to disclosure obligations which are equivalent to the following:

(i) disclosure obligations set out in Articles 17 and 19 of Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 9 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC,

(ii) disclosure obligations consistent with Articles 3, 5, 7, 8, 10, 14 and 16 of Directive 2003/71/EC of the European Parliament and of the Council of 4 November 2003 10 on the prospectuses to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC,

(iii) disclosure obligations consistent with Articles 4 to 6, 14, 16 to 19 and 30 of Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 11 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive 2001/34/EC, and

(iv) disclosure requirements consistent with EU legislation made under the provisions mentioned in subparagraphs (i) to (iii) ; ]

“relevant independent legal professional” means a barrister, solicitor or notary who carries out any of the following services:

( a) the provision of assistance in the planning or execution of transactions for clients concerning any of the following:

(i) buying or selling land or business entities;

(ii) managing the money, securities or other assets of clients;

(iii) opening or managing bank, savings or securities accounts;

(iv) organising contributions necessary for the creation, operation or management of companies;

(v) creating, operating or managing trusts, companies or similar structures or arrangements;

( b) acting for or on behalf of clients in financial transactions or transactions relating to land;

“relevant professional adviser” means an accountant, auditor or tax adviser who is a member of a designated accountancy body or of the Irish Taxation Institute;

F11 [ senior management means an officer or employee with sufficient knowledge of the institution s money laundering and terrorist financing risk exposure and sufficient seniority to take decisions affecting its risk exposure, and need not, in all cases, be a member of the board of directors; ]

“solicitor” means a practising solicitor;

“State competent authority” has the meaning assigned to it by section 62 ;

“tax adviser” means a person who by way of business provides advice about the tax affairs of other persons;

“transaction” means—

( a) in relation to a professional service provider, any transaction that is carried out in connection with a customer of the provider and that is—

(i) in the case of a provider acting as an auditor, the subject of an audit carried out by the provider in respect of the accounts of the customer,

(ii) in the case of a provider acting as an external accountant or tax adviser, or as a trust or company service provider, the subject of a service carried out by the provider for the customer, or

(iii) in the case of a provider acting as a relevant independent legal professional, the subject of a service carried out by the professional for the customer of a kind referred to in paragraph (a) or (b) of the definition of “relevant independent legal professional” in this subsection;

and

( b) in relation to a casino or private members’ club, a transaction, such as the purchase or exchange of tokens or chips, or the placing of a bet, carried out in connection with gambling activities carried out on the premises of the casino or club by a customer of the casino or club;

F11 [ transferable securities means transferable securities within the meaning of the European Union (Markets in Financial Instruments) Regulations 2017; ]

“trust or company service provider” means any person whose business it is to provide any of the following services:

( a) forming companies or other bodies corporate;

( b) acting as a director or secretary of a company under an arrangement with a person other than the company;

( c) arranging for another person to act as a director or secretary of a company;

( d) acting, or arranging for a person to act, as a partner of a partnership;

( e) providing a registered office, business address, correspondence or administrative address or other related services for a body corporate or partnership;

( f) acting, or arranging for another person to act, as a trustee of a trust;

( g) acting, or arranging for another person to act, as a nominee shareholder for a person other than a company whose securities are listed on a regulated market.

(2) The Minister may prescribe a regulated financial market for the purposes of the definition of “regulated market” in subsection (1) only if the Minister is satisfied that the market is in a place other than an EEA State that imposes, on companies whose securities are admitted to trading on the market, disclosure requirements consistent with legislation of the European Communities.

Annotations:

Amendments:

F8

Inserted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(a), S.I. No. 486 of 2018.

F9

Inserted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 3(b), S.I. No. 486 of 2018.

F10

Substituted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(c), S.I. No. 486 of 2018.

F11

Inserted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(d), (e), (i), (k), (p), (q), S.I. No. 486 of 2018.

F12

Deleted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(f), (j), (n), S.I. No. 486 of 2018.

F13

Substituted Deleted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(g), (h), (m), (o), S.I. No. 486 of 2018.

F14

Substituted (14.06.2013) by Criminal Justice Act 2013 (19/2013), s. 4, S. I. No. 196 of 2013.

F15

Substituted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(l)(i), (iii), S.I. No. 486 of 2018.

F16

Inserted (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 (26/2018), s. 4(l)(ii), S.I. No. 486 of 2018.

Modifications (not altering text):

C4

Definition of “occasional transaction” modified (26.11.2018) by Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 (Section 25) (Prescribed Class of Designated Person) Regulations 2018 (S.I. No. 487 of 2018), reg. 4, in effect as per reg. 1(2).

3. (1) Providers of gambling services are prescribed as a class of persons for the purposes of section 25(1)(j) of the Act of 2010.

(2) In this Regulation, “gambling services” means gambling services within the meaning of Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 20151 other than—

(a) poker games provided at a physical location other than a casino or private members’ club,

(b) lotteries within the meaning of the Gaming and Lotteries Act 1956 (No. 2 of 1956), and

(c) gaming machines (within the meaning of section 43 of the Finance Act 1975 (No. 6 of 1975)) or amusement machines (within the meaning of section 120 of the Finance Act 1992 (No. 9 of 1992)) provided in accordance with section 14 of the Gaming and Lotteries Act 1956 .

4. Insofar as a person is a designated person by virtue of being a member of the class of persons prescribed in Regulation 3, the definition of “occasional transaction” in section 24 of the Act of 2010 shall be modified so that the reference in paragraph (a) of that definition to “a person referred to in section 25(1)(h)” be read as a reference to a member of the class of persons prescribed in Regulation 3.

10 OJ L 319, 5.12.2007, p.1

11 OJ No. L 390, 31.12.2004, p. 38

3 OJ No. L 176, 27.6.2013 p. 1

4 OJ No. L 302, 17.11.2009, p. 32

5 OJ No. L 302, 18.11.2010, p. 1

6 OJ No. L 182, 29.6.2013, p. 19

7 OJ L 9, 15.1.2003, p. 3

8 OJ No. L 173, 12.6.2014, p. 349

9 OJ L 145, 30.4.2004, p. 1