International cooperation: Comments and recommendations by the NBB

Book IV of the Anti-Money Laundering Law includes a Title 5, inserted by the Law of 20 July 2020, which is devoted to the cooperation between the relevant authorities and defines the limits of the professional secrecy to which they are bound, in particular by lifting it where it could constitute an obstacle to cooperation. Similarly, Article 36/13 of the Law of 22 February 1998 establishing the organic statute of the National Bank of Belgium sets out the exceptions to the NBB’s obligation of professional secrecy which are applicable in the context of its mission to prevent money laundering and terrorist financing. Book IV, Title 5 of the Anti-Money Laundering Law comprises three chapters: the first containing provisions common to the two following chapters (Articles 120/2 and 120/3), the second one pertaining to national cooperation (see the page “National cooperation”) and the last one to international cooperation (Articles 130 to 131/5).

1. Provisions common to national and international cooperation

Article 120/2 of the Anti-Money Laundering Law defines a number of concepts used in Title 5. This provision should be read in conjunction with Article 4, 17° of the Anti-Money Laundering Law, which in particular defines the concept of “supervisory authorities” as the authorities referred to in Article 85 of the Law. On the basis of this definition, Article 120/2 specifies two categories of supervisory authorities in particular: the “financial supervisory authorities” (1°), on the one hand, and the “supervisors” (7°), on the other. This distinction is theoretical in Belgium: both terms refer to the same authorities, namely the NBB, the FSMA and the FPS Economy. They will sometimes be qualified as supervisors and sometimes as financial supervisory authorities, depending on whether reference is made to their competence to supervise compliance with anti-money laundering provisions, or with rules of a financial nature, also known as “prudential” rules when referring to the rules supervised by the NBB.

Article 120/3 of the Law introduces a principle of finality for the financial supervisory authorities in relation to the way they use the confidential information of which they become aware in their capacity as AML/CFT supervisory authority. The same principle is also expressed in Article 36/12/4 of the Law of 22 February 1998 establishing the organic statute of the National Bank of Belgium.

2. Provisions specific to international cooperation

2.1. Anti-Money Laundering Law

2.1.1. Cooperation between Belgian and foreign supervisory authorities

Article 130 of the Anti-Money Laundering Law first sets out the general principle of cooperation and information exchange between the Belgian and foreign supervisory authorities competent with regard to AML/CFT. This principle is then illustrated in different situations where the Belgian supervisory authorities, including the NBB, are required in particular to cooperate with foreign supervisory authorities.

For instance, the following applies in particular to the NBB in the context of its scope ratione personae as defined in Article 85 of the Anti-Money Laundering Law:

  • Where the entity concerned is a branch, a subsidiary or other form of establishment on the Belgian territory (particularly a network of agents or distributors) of a foreign financial institution, this entity is subject, in Belgium, not to the AML/CFT law of its country of origin but to the Belgian Anti-Money Laundering Law, and the authority competent for monitoring compliance with this Belgian legislation is not the supervisory authority of the country of origin but the NBB; nevertheless, this territorial supervisory power should be exercised taking into account the dependence of the supervised entity on its registered office or its parent company, which is itself an obliged entity that is supervised in its country of origin. For example, the efficiency of the Belgian entity’s AML/CFT governance arrangements is dependent on the compliance thereof with those of the parent company. Conversely, the AML/CFT situation of the Belgian entity could impact that of its parent company in its country of establishment. Article 130, § 2, 1°, of the Anti-Money Laundering Law therefore requires the NBB to cooperate and exchange all useful information with the supervisory authority of the country of origin that is competent with regard to the parent company.
  • In the same situation, both the FATF standards and Directive 2015/849 stipulate that the parent company should establish internal AML/CFT policies and procedures that apply to all entities of the group, including the Belgian entity; the authority competent for monitoring compliance with this obligation is the authority of the country of origin. However, Article 130, § 2, 2°, of the Anti-Money Laundering Law requires the NBB to cooperate with this foreign authority to monitor the effective implementation of the group policy and procedures by the Belgian entity.
  • Article 130, § 2, 3°, of the Anti-Money Laundering Law contains provisions mirroring those described above, which apply where the Belgian entity is the parent company of a group that has established obliged entities in other Member States or in third countries;
  • Article 130, § 2, 3°, of the Anti-Money Laundering Law is formulated in such a way that, in the case of a Belgian obliged entity belonging to a foreign group, this provision also constitutes the legal basis enabling the NBB to cooperate with the competent supervisory authorities of Member States or third countries, other than the country of establishment of the group’s parent company, in which this group has other establishments.

The conditions under which the NBB is required, in its capacity as AML/CFT supervisory authority, to exchange information with foreign AML/CFT supervisory authorities as part of the cooperation described above are specified in Article 131 of the Anti-Money Laundering Law. Where the foreign supervisory authority is not itself bound by a legal obligation of professional secrecy at least equivalent to that to which the NBB is subject, the NBB may in essence only share information on the condition that a Memorandum of Understanding (MoU) is concluded beforehand on the basis of the principle of reciprocity. This Memorandum should prohibit the authority receiving the information shared by the NBB from using it for purposes other than AML/CFT supervision and from transmitting this information to third parties without the NBB’s consent.

However, this condition does not apply to the cooperation between the NBB and the AML/CFT financial supervisory authorities of another EEA Member State, for which Directive 2018/843 has introduced a harmonised professional secrecy regime. Information sharing between these authorities is subject only to the condition that the authority receiving the information does not transmit it to a third-country authority without the consent of the authority that transmitted the information to it (in this case the NBB). Conversely, a financial supervisory authority of a Member State that has received information from the NBB may share this information with a financial supervisory authority of another Member State without the NBB’s consent.

2.1.2. International cooperation between financial supervisory authorities and supervisors

Article 131/1, § 1, of the Anti-Money Laundering Law establishes the obligation for competent AML/CFT financial supervisory authorities, including the NBB, to cooperate with foreign supervisors competent for the “prudential” supervision of financial institutions (including the European Central Bank) and to exchange with them all information (including confidential information) useful for the exercise of their respective supervisory powers.

Article 131/1, § 2, of the Anti-Money Laundering Law introduces the same obligation for Belgian supervisors, including the NBB in its capacity as prudential supervisor, i.e. the obligation to cooperate and exchange all useful information with foreign AML/CFT financial supervisory authorities.

The conditions under which the NBB is required, in its capacity as AML/CFT supervisory authority, to exchange information with foreign supervisors are specified in Article 131/2 of the Anti-Money Laundering Law. Where the foreign supervisor is not itself bound by a legal obligation of professional secrecy at least equivalent to that to which the NBB is subject, the NBB may in essence only share information on the condition that a Memorandum of Understanding (MoU) is concluded beforehand on the basis of the principle of reciprocity. This Memorandum should prohibit the supervisor receiving the information from using it for purposes other than prudential supervision and from transmitting this information to third parties without the NBB’s consent.

However, this condition does not apply to the cooperation between the NBB and the supervisors of another EEA Member State competent for the supervision of certain financial institutions (credit institutions, stockbroking firms and insurance companies), for which European directives relating specifically to the supervision of these institutions have introduced a harmonised professional secrecy regime. Information sharing between these authorities is subject only to the condition that the authority receiving the information does not transmit it to a third-country authority without the consent of the authority that transmitted the information to it (in this case the NBB). Conversely, a supervisor of a Member State that has received information from the NBB may share this information with a supervisor of another Member State without the NBB’s consent.

2.1.3. International cooperation between supervisory authorities and the authorities responsible for the supervision of financial markets

Articles 131/3 and 131/4 impose and organise, in a similar way as in the above-mentioned Articles, cooperation between the AML/CFT supervisory authorities, including the NBB, and the authorities responsible for the supervision of financial markets of the other EEA Member States. Here, too, the principle applies that the authorities concerned should exchange all information useful for the exercise of their respective tasks.

2.1.4. International cooperation between supervisory authorities and the ESAs

Article 36/13, § 1, 8°, of the Law of 22 February 1998 establishing the organic statute of the National Bank of Belgium provides that the NBB may, by way of derogation from its professional secrecy obligation, communicate confidential information received in the exercise of its AML/CFT supervisory tasks (as referred to in Article 36/2, § 2, of that Law), within the limits of European Union law, to the European Securities and Markets Authority, the European Insurance and Occupational Pensions Authority and the European Banking Authority. This exception to the NBB's professional secrecy enables it, in particular, to provide the EBA with confidential information, including nominative information, as required by the European regulations defining its AML/CFT tasks.

It should also be noted that, pursuant to Article 131/5 of the Anti-Money Laundering Law, the NBB is required to inform the ESAs (in particular the EBA) of cases where it is itself informed, by a financial institution subject to the Anti-Money Laundering Law which has a subsidiary, branch or other form of establishment in a third country, that the law of this third country does not permit the implementation within those establishments of the AML/CFT policies and procedures in force at group level, including the policies and procedures on data protection and intra-group information sharing for AML/CFT purposes. In such a situation (as referred to in Article 13, § 3, third paragraph, of the Law), the NBB and the ESAs should cooperate in finding a solution.

2.2. ESAs joint guidelines on AML/CFT colleges

The establishment of “AML/CFT colleges” aims to create a permanent structure for enhanced cooperation and information sharing between European and third-country authorities responsible for the AML/CFT supervision of the same financial institution operating on a cross-border basis. These AML/CFT colleges are intended to provide AML/CFT supervisory authorities with a forum where they can work together to improve their understanding of the ML/FT risks associated with the financial institution concerned, exchange information to inform each other on the supervisory approach to be adopted and coordinate their supervisory actions where necessary.

As such, the NBB should henceforth, in its capacity as AML/CFT supervisory authority:

  • periodically organise AML/CFT colleges for the groups of financial institutions for which it is the “lead supervisor”; and
  • participate in other AML/CFT colleges of which it is a permanent member.

The relevant ESAs are also invited to participate in the colleges as permanent members. In addition, cooperation is foreseen with the prudential supervisors of the Member States concerned, who are invited to participate in the AML/CFT colleges as observers.

For more information on this subject, particularly the conditions for establishing an AML/CFT college, please refer to the ESAs Joint Guidelines on AML/CFT colleges (see the page “Main reference documents”).

Where the conditions for setting up an AML/CFT college are not met, competent authorities should ensure cooperation and information exchange on a bilateral basis.

Disclaimer: This English text is an unofficial translation and may not be used as a basis for solving any dispute