Source: OJ L, 2024/1620, 19.6.2024Current language: EN
- Anti-money laundering
Basic legislative acts
- Anti-money laundering authority regulation (AMLAR)
Article 63 Composition and appointment of the Executive Board
Summary What does Article 63 of the Anti-money laundering authority regulation (AMLAR) say?
This article sets out the composition, appointment process, terms of office, independence requirements, and post-office restrictions for the Executive Board of the Authority.
It is a foundational governance article that works closely with Article 64, which defines the Executive Board's tasks and decision-making powers.
The article establishes a multi-institution appointment process involving the Commission, European Parliament, and Council, and places strong emphasis on the independence of the five full-time members from any external influence.
Important points:
- The Executive Board is composed of the Chair and five full-time members (including a Vice-Chair), with the Commission entitled to participate in debates on certain administrative tasks and the Executive Director attending without voting rights.
- The five full-time members are appointed through an open selection process: the Commission shortlists candidates, the General Board proposes, the European Parliament approves, and the Council formally appoints by qualified majority — with a single possible term extension of four years.
- Former Executive Board members, including the Chair and Vice-Chair, are prohibited for 18 months after leaving office from taking up a gainful activity with a selected obliged entity or any entity where a conflict with the Authority's interests could arise.
Springlex's summary of the article, a reading aid, not a substitute for the legal text.
The Executive Board shall be composed of:
the Chair of the Authority;
five full-time members, including the Vice-Chair.
Where the Executive Board carries out the tasks referred to in Article 64(4), points (a) to (l), a representative of the Commission shall be entitled to participate in the debates and shall only have access to the documents pertaining to those tasks.
The Executive Director shall participate in meetings of the Executive Board without the right to vote.
Where the decisions referred to in Article 64(2) in relation to a selected obliged entity are deliberated upon, the member of the General Board in supervisory composition from the Member State where the concerned selected obliged entity is established may participate in the deliberations during the relevant meetings of the Executive Board.
That member of the General Board shall not be present during the vote following such deliberations.
The Executive Board members referred to in paragraph 1, point (b), shall be selected on the basis of merit, skills, knowledge, integrity, recognised standing and experience in the area of AML/CFT, and other relevant qualifications, following an open selection procedure which shall be published in the Official Journal of the European Union.
The Commission shall prepare a shortlist of candidates for the position of the Executive Board members referred to in paragraph 1, point (b). The European Parliament may conduct hearings of the candidates on that shortlist.
The General Board shall submit a proposal for the appointment of the Executive Board members referred to in paragraph 1, point (b), to the European Parliament, based on the shortlist prepared by the Commission. Following the European Parliament’s approval of that proposal, the Council shall adopt an implementing decision to appoint those Executive Board members. The Council shall act by qualified majority.
Throughout the appointment process, the principles of gender and geographical balance shall be taken into account to the extent possible.
The term of office of the Executive Board members referred to in paragraph 1, point (b), shall be four years. In the course of the 12 months preceding the end of their four-year term of office, the General Board in both compositions or a smaller committee selected among General Board members, including a Commission representative, shall carry out an assessment of those Executive Board members. The assessment shall take into account an evaluation of each Executive Board member’s performance and the Authority’s future tasks and challenges. Based on the assessment, the General Board in both compositions may propose to the European Parliament to extend their term of office. Such extension may be granted only once. Following the European Parliament’s approval of the General Board’s proposal, the Council shall adopt an implementing decision to extend the term of office of the Executive Board member or members concerned. The Council shall act by qualified majority.
The Executive Board members referred to in paragraph 1, point (b), shall act independently and objectively in the interest of the Union as a whole and shall neither seek nor take instructions from Union institutions, bodies, offices or agencies, or from any government or any other public or private body. The Union institutions, bodies, offices and agencies, the governments of Member States and all other public or private bodies shall respect that independence.
If an Executive Board member referred to in paragraph 1, point (b), no longer fulfils the conditions required for the performance of that member’s duties or has been guilty of serious misconduct, the Council may, acting on its own initiative or following a proposal by the European Parliament or the General Board in either composition, adopt an implementing decision to remove that member of the Executive Board from office. The Council shall act by qualified majority.
During a period of 18 months after ceasing to hold office, the former Executive Board members, including the Chair and Vice-Chair of the Authority, shall be prohibited from engaging in a gainful occupational activity with:
a selected obliged entity;
any other entity, where doing so would or could lead to a conflict with the legitimate interests of the Authority.
In its rules for the prevention and management of conflicts of interest in respect of its members, referred to in Article 64(4), point (e), the Executive Board shall specify the circumstances under which such a conflict of interest exists or could be perceived to exist.
Springlex and this text is meant purely as a documentation tool and has no legal effect. No liability is assumed for its content. The authentic version of this act is the one published in the Official Journal of the European Union.
Definition
crypto-asset services
Definition
financial mixed activity holding company
Definition
crypto-asset service provider
Definition
credit institution
- a credit institution as defined in Article 4(1), point (1), of Regulation (EU) No 575/2013;
- a branch of a credit institution, as defined in Article 4(1), point (17), of Regulation (EU) No 575/2013, when located in the Union, whether its head office is located in a Member State or in a third country;
Definition
parent undertaking
- for groups whose head office is located in the Union, an obliged entity that is a parent undertaking as defined in Article 2, point (9), of Directive 2013/34/EU that is not itself a subsidiary of another undertaking in the Union, provided that at least one subsidiary undertaking is an obliged entity;
- for groups whose head office is located outside of the Union, where at least two subsidiary undertakings are obliged entities established in the Union, an undertaking within that group established in the Union that:
- is an obliged entity;
- is an undertaking that is not a subsidiary of another undertaking that is an obliged entity established in the Union;
- has a sufficient prominence within the group and a sufficient understanding of the operations of the group that are subject to the requirements of this Regulation; and
- is given the responsibility of implementing group-wide requirements under Chapter II, Section 2 of this Regulation;
Definition
selected obliged entity
Definition
crypto-asset
Definition
property
Definition
group
Definition
financial institution
- an undertaking other than a credit institution or an investment firm, which carries out one or more of the activities listed in points (2) to (12), (14) and (15) of Annex I to Directive 2013/36/EU of the European Parliament and of the Council(32), including the activities of currency exchange offices (bureaux de change), but excluding the activities referred to in point (8) of Annex I to Directive (EU) 2015/2366, or an undertaking the principal activity of which is to acquire holdings, including a financial holding company, a mixed financial holding company and a financial mixed activity holding company;
- an insurance undertaking as defined in Article 13, point (1), of Directive 2009/138/EC of the European Parliament and of the Council(33), insofar as it carries out life or other investment-related assurance activities covered by that Directive, including insurance holding companies and mixed-activity insurance holding companies as defined, respectively, in Article 212(1), points (f) and (g), of Directive 2009/138/EC;
- an insurance intermediary as defined in Article 2(1), point (3), of Directive (EU) 2016/97 where it acts with respect to life insurance and other investment-related insurance services, with the exception of an insurance intermediary that does not collect premiums or amounts intended for the customer and which acts under the responsibility of one or more insurance undertakings or intermediaries for the products which concern them respectively;
- an investment firm as defined in Article 4(1), point (1), of Directive 2014/65/EU of the European Parliament and of the Council(34);
- a collective investment undertaking, in particular:
- an undertaking for collective investment in transferable securities (UCITS) as defined in Article 1(2) of Directive 2009/65/EC and its management company as defined in Article 2(1), point (b), of that Directive or an investment company authorised in accordance with that Directive and which has not designated a management company, that makes available for purchase units of UCITS in the Union;
- an alternative investment fund as defined in Article 4(1), point (a), of Directive 2011/61/EU and its alternative investment fund manager as defined in Article 4(1), point (b), of that Directive that fall within the scope set out in Article 2 of that Directive;
- a central securities depository as defined in Article 2(1), point (1), of Regulation (EU) No 909/2014 of the European Parliament and of the Council(35);
- a creditor as defined in Article 4, point (2), of Directive 2014/17/EU of the European Parliament and of the Council(36) and in Article 3, point (b), of Directive 2008/48/EC of the European Parliament and of the Council(37);
- a credit intermediary as defined in Article 4, point (5), of Directive 2014/17/EU and in Article 3, point (f), of Directive 2008/48/EC, when holding the funds as defined in Article 4, point (25), of Directive (EU) 2015/2366 in connection with the credit agreement, with the exception of the credit intermediary carrying out activities under the responsibility of one or more creditors or credit intermediaries;
- a crypto-asset service provider;
- a branch of a financial institution referred to in points (a) to (i), when located in the Union, whether its head office is located in a Member State or in a third country;
Definition
third country
Definition
funds