On 15 June 2020, the Ministry of Economic Affairs and Digital Transformation published the draft law that will amend Law 10/2010, of 28 April, on the prevention of money laundering and terrorism financing for the purpose of implementing Directive (EU) 2018/843 of the European Parliament and of the Council of 30 May 2018 (V AMLD).

This draft law, which is still subject to comments from market participants and, therefore, to subsequent modifications, presents relevant new features, of which we highlight the following:

New entities/individuals subjects to Spanish AML regulations

One of the main updates of the draft law is the inclusion of new entities and individuals subject to AML regulations:

  • Crowdlending and crowdfunding platforms (plataformas de financiación participativa).
  • Providers engaged in exchange services between virtual currencies and fiat currencies and custodian wallet providers, the latter being those natural or legal persons that provide cryptographic private key safeguarding services on behalf of their clients, for the holding, storage and transfer of virtual currencies in a manner similar to the custody of traditional funds or financial assets.
  • REITs (known in Spain as SOCIMIs).
  • Management companies of securitization funds.
  • Independent external experts in relation to the content of their reports.

In addition, with regard to real estate developers, it is established that they will only be subject when they obtain an annual income higher than EUR 120,000 or a monthly income equal to or higher than EUR 10,000.

A single register is created in the Ministry of Justice that will centralize the information on the ultimate beneficial owner (UBO) contained in the existing registers and databases of the General Council of Notaries and the Commercial Registry and will make it possible to obtain the information directly.

This UBO register shall contain information on the UBO of all Spanish legal persons and entities without legal personality having their headquarters or main activity in Spain. It will also include data on entities or structures without legal personality which, not being managed or administered from Spain or another European Union State, and not being registered by another European Union State, intend to establish business relations, carry out occasional operations or acquire real estate in Spain.

It also establishes the obligation for legal persons and entities without legal personality to obtain, retain and update information on their UBO for a period of 10 years and provide it to authorities and regulated entities. .

Representative to SEPBLAC (MLRO)

Two updates are included in relation to the MLRO. Firstly, it is established that in foreign parent groups comprising several entities subject to Spanish AML regulations, there will be a single MLRO of the entity subject to Spanish AML regulations in the group with the highest volume of business.

Likewise, with regard to entities subject to AML regulations operating in Spain under the freedom to provide services, the obligation that the MLRO must not reside in Spain is maintained, but it is added that they must designate an address in Spain for the purposes of notifications and communications.

Outsourcing of recordkeeping services by financial institutions

Financial institutions are required to notify their supervisors in advance of their intention to contract with recordkeeping service providers. These recordkeeping and processing services shall be provided by service providers within the European Economic Area or, where applicable, in a third country which, according to the European Commission, offers the necessary guarantees to ensure an adequate level of protection equivalent to that offered in the European Union, and provided that the provisions on the transfer of personal data to third countries or international organisations are complied with.

Other relevant updates

  • In relation to the establishment of business relationships or the execution of transactions by telephone, electronic or telematic means, verification of the customer's identity shall be carried out by means of the qualified electronic signature regulated in Regulation (EU) 910/2014 of the European Parliament and of the Council of 23 July 2014.
  • The period in which due diligence measures must continue to be applied to PEPs after they leave their positions is reduced from two years to one.