Global Trustee and Fiduciary Services News and Views

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Global Trustee and Fiduciary Services News and Views | Issue 47 | 2017 31
1 See
PDF/?uri=CELEX:32005L0060&from=en, last accessed
on 26 October 2016.
2 See
?uri=CELEX:32005L0060&from=en, last accessed on 26
October 2016.
3 See
aml-directive_en.pdf, last downloaded on 26 October 2016.
4 European Banking Authority (EBA) European Insurance and
Occupational Pensions Authority (EIOPA) and the European
Securities and Markets Authority (ESMA). Together, the “ESA’s”.
5 See
2015%20061%20(Joint%20Draft%20Guidelines%20on%20
AML_CFT%20RFWG%20Art%2017%20and%2018).pdf,
last downloaded on 17 November 2016.
information which must be kept on the central
register, particularly in the context of funds
that permit dealing on a regular basis.
Trustees will also be required to obtain and hold
information on beneficial owners. Where the
trust gives rise to “tax consequences” Member
States must also ensure that the beneficial
ownership information held by the trustee is
held on a central register. This will be an entirely
new requirement for fund trustees, as unitholder
register details are normally obtained and
maintained by the fund’s administrator on behalf
of the trust fund, not the trustee of the fund.
It remains to be seen as to the extent to which
certain types of trust fund type arrangements
may be included/excluded from the scope of
domestic legislation in individual Member States
and clarity is being sought by funds industry
bodies as to whether or not certain trust funds
will be caught by the new requirements.
In this regard, it should be highlighted that
in terms of transposing the requirements of
the 4AMLD into the UK legislative framework,
that the transposition of the European level
requirements are fully reflective of UK legal
structures, and further that the responsibilities
under the 4AMLD are correctly and
unambiguously assigned to the parties most
appropriate to perform these tasks.
For example, in the case of collective
investment schemes, whatever their
legal structure — Open-ended Investment
Companies (OEICs), Unit Trusts or Authorised
Contractual Schemes (ACS), responsibility
for executing transactions in units/shares
and maintaining unitholder/shareholder
registers of the applicable scheme would
normally fall on the Authorised Fund Manager
(AFM) as operator of the scheme. Therefore
it would appear practical and appropriate
that it should be the AFM, as operator of the
scheme, who would ensure money laundering
obligations are properly performed.
What action is to be taken
4AMLD is a minimum-harmonisation directive
and Member States have the power to impose
more stringent measures delegated in the form
of delegated acts and technical standards.
Further regulation and guidance can be
expected both at EU and Member State level
between now and June 2017 and beyond. For
example, in Ireland, Article 30(1) of 4AMLD
(which requires companies and other corporate
bodies to gather details on the beneficial
ownership) has just recently been transposed
so as to ensure that the information required to
be sent to the central register will be available
by 26 June 2017. Anyone promoting or servicing
a fund, with responsibility for carrying out CDD
for the fund on an outsourced basis, needs to
consider preparatory work including:
• The requirement for the fund as an “obliged
entity” to carry out an AML/CTF assessment
under 4AMLD and review the impact this may
have on various issues including CDD.
• Reviewing the fund’s AML/CTF policy and
other relevant documentation in the context
of 4AMLD.
• Liaison, in the case of a fund and where relevant,
with the fund administrator to ascertain the
preparatory measures that the administrator is
taking with regard to compliance with 4AMLD,
including as to its identification of the fund’s
beneficial owners and its own policies and
procedures and how they will affect the fund.
Trustees of funds established as trusts also
need to consider the extent to which the trusts
for which they act may be within scope and as
to their potential compliance obligations. At
present, it is not clear which trusts fall within
the scope of 4AMLD and it is hoped that this
uncertainty will be resolved to enable funds and
service providers to comply with the provisions
of 4AMLD on a timely basis.
Patricia Taylor
Partner
William Fry