On 3 February 2020, the Rules for Application of the Provisions of Law no. 129/2019 on the prevention and combatting of money laundering and the financing of terrorism were published in the Official Gazette of Romania by the National Office for the Prevention and Combatting of Money Laundering.
While the rules provide some clarification regarding the obligations on reporting entities, there are still many issues (such as the definition of suspicious transactions and the notion of “doing business”) that require more detail in order to facilitate a proper application of Law no. 129/2019.
The rules also stipulate the following with respect to companies described as reporting entities according to the law:
- the category of entities providing business consultancy services expressly includes those that are actually carrying out activities as per CAEN code 7022 (business and management consultancy activities);
- the service providers for companies category also includes entities that carry out activities as per CAEN codes 6420 (activities of holding companies) and 6820 (leasing and sub-leasing of own or rented real estate).
Furthermore, the rules clarify the different circumstances in which reporting entities are obliged to provide an independent audit function, with a view to verifying internal policies and procedures for the prevention and combatting of money laundering and the financing of terrorism – namely, where at least two of the following criteria are exceeded during the previous financial year:
- total assets: RON 5.000.000;
- total net turnover: RON 10.000.000;
- average number of employees: 30.
There is also further clarification as regards the obligation on reporting entities to retain documents and information obtained from clients, for the purpose of preventing, detecting and investigating cases of money laundering or terrorism financing, for the entire period of their business relationship plus a further period of 5 years following termination of the relationship or the date of the occasional transaction. The competent authorities may request, in writing, the extension of the retention period of documents by up to a maximum of 5 years.
These rules came into effect on 3 February 2020, meaning that companies have only very little or even no time at all to update their anti-money laundering policies and thus comply with the law.
Source: The Rules for Application of the Provisions of Law no. 129/2019 on the prevention and combatting of money laundering and the financing of terrorism, as well as to amend and supplement various legislative acts, for reporting entities overseen and verified by the National Office for the Prevention and Combatting of Money Laundering since 22 January 2020, published in the Official Gazette of Romania, Part I, no. 75, on 3 February 2020.
