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Economy Watch: Brussels Tackles Money Laundering and Terrorist Financing

In a bid to crack down on money laundering and terrorist financing, the Belgian authorities have introduced a range of measures aimed at preventing these illicit activities. The new rules, outlined in the ML/TF Act, will impact various sectors, including service providers, real estate agents, diamond traders, finance leasing companies, and more.

Who’s Affected?

The ML/TF Act affects anyone who provides services, conducts transactions, or engages in financial activities in Belgium. This includes professionals like:

  • Lawyers
  • Accountants
  • Notaries
  • Businesses such as:
    • Banks
    • Insurance companies
    • Investment firms

What’s Changing?

Under the new rules, cash payments will be limited to certain amounts, and donations exceeding these limits will also be subject to restrictions. The amounts vary depending on the type of transaction, with some exceptions for consumer transactions and certain financial institutions.

Sanctions for Non-Compliance

Failure to comply with the ML/TF Act can result in:

  • Administrative fines ranging from €250 to €1,250,000 for non-financial professions
  • 5% to 10% of annual net turnover for financial professions
  • Criminal fines of up to €1,800,000 may be imposed in cases where cash payments exceed the permissible limits

Role of the FPS Economy

The Federal Public Service (FPS) Economy plays a key role in monitoring compliance with the ML/TF Act. The agency is responsible for:

  • Setting regulatory standards
  • Ensuring that individuals and businesses subject to the Act comply with their legal obligations
  • Monitoring cash transactions and donations to prevent money laundering and terrorist financing

What’s Next?

As of April 22, 2024, all entities subject to the ML/TF Act must comply with the new rules. The FPS Economy will begin conducting on-site inspections and monitoring cash transactions to ensure compliance.

In conclusion, the Belgian government has taken a significant step towards preventing money laundering and terrorist financing by introducing the ML/TF Act. As of April 22, 2024, businesses and individuals must adapt to the new regulations to avoid severe penalties.