Source: AMLA consultation paper draft
- Anti-money laundering
AMLR supplemental acts
- RTS on group-wide minimum requirements and additional measures for third-country subsidiaries and branches
Article 21 Conditions for the application of group-wide requirements to structures sharing common ownership, management or compliance control
This is a draft act
This text has been parsed from the AMLA consultation paper draft as published on 16 April 2026. While we run a suite of validations, the automated parsing can result in errors. Also, before it is finally adopted by the Commission, its wording, numbering and references may change, and entire articles might be removed or added.
Summary What does Article 21 of the RTS on group-wide minimum requirements and additional measures for third-country subsidiaries and branches say?
This article extends the reach of group-wide AML/CFT requirements beyond formal corporate groups to cover a broader range of organisational arrangements.
Building on the group-wide obligations established in Article 16 of Regulation (EU) 2024/1624, it ensures that obliged entities operating within structures such as partnerships, networks, or franchises — which share common ownership, management, or compliance control but do not meet the formal definition of a group — must nonetheless apply equivalent standards.
The article also provides detailed criteria for determining when such common ownership, management, or compliance control exists, casting a wide net to prevent regulatory arbitrage through the use of looser organisational arrangements.
Important points:
- Apply group-equivalent AML/CFT policies, procedures and controls if your organisation operates within a structure sharing common ownership, management, or compliance control with other obliged entities, even where no formal group relationship exists.
- The scope of qualifying structures is broad, covering partnerships, networks, and franchises, with multiple indicators across ownership, management, and compliance dimensions used to determine whether the threshold is met.
- Non-obliged entities within a structure, such as franchisors or network members, cannot be used as a reason to avoid applying group-equivalent requirements to the obliged entities within that structure.
Springlex's summary of the article, a reading aid, not a substitute for the legal text.
The parent undertaking identified in this Section and obliged entities within the structures identified in this Article shall apply requirements equivalent to the group-wide requirements set out in Article 16(1), (2) and (3) of Regulation (EU) 2024/1624 and in this Regulation, taking into account the obliged entities´ size, complexity and risks.
Structures which share common ownership, management or compliance control shall be, among others, partnerships, networks or franchises as defined in Article 2 of this Regulation that do not fall under the definition of a group pursuant to Article 2(1) number (41) of Regulation (EU) 2024/1624, and that fulfil at least one of the following conditions:
Common ownership by any of the following:
two or more obliged entities share any common majority shareholder(s) or partner(s) exercising ownership rights or control on their activities in the structure, including situations where the parent undertaking in the Union is not an obliged entity;
two or more obliged entities share the ownership or control of the structure.
Common management by any of the following:
two or more obliged entities are legally dependent parts of an entity in the Union or an entity in a third country and carry out all or some of the transactions or activities or services inherent in the business of an obliged entity as referred to in Article 3 of Regulation (EU) 2024/1624;
two or more obliged entities have a common management body or the majority of members thereof and are subject to a homogeneous business strategy and/or business model;
two or more obliged entities have a common structure or mechanism in place to share profits or revenues or results or losses or to transfer remunerations, revenues or costs for services or activities provided;
two or more obliged entities have level of reporting equivalent to groups such as the case of obliged entities required to report to the management body or senior management of one of them or another obliged entity or another entity or person;
two or more obliged entities have in place arrangements requiring them to implement and operate activities and operations based on common policies and procedures;
two or more obliged entities conferred the responsibility for developing mandatory group-equivalent policies and procedures related to anti money laundering and counter terrorism financing to one of them or to another obliged entity or to another natural or legal person.
Common compliance control by any of the following:
two or more obliged entities operate under common policies, procedures or controls managed by a control function;
two or more obliged entities are obliged to periodically report to a connected obliged entity, legal or natural person on control functions matters such as compliance or risk management;
two or more obliged entities have in place a system of periodic central compliance operations or compliance costs managed by one of them or by another obliged entity or a natural or legal person;
two or more obliged entities share audit or reporting functions overseeing the implementation of controls, policies and procedures;
two or more obliged entities have common branding, marketing or franchising arrangements and share the same audits, reviews, risk assessments or control functions related to such branding, marketing or franchising arrangements.
Entities within the structure, including franchisors, partners or network members, which are not obliged entities, shall not prevent the application of group-equivalent policies, procedures and controls to obliged entities within the structure.
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
senior management
Definition
franchise
- at least two obliged entities establish a relationship between each other and/or with a third entity in exchange for direct or indirect financial benefits exploiting a brand, the know‑how, and/or business systems owned or managed by a franchisor for the purposes of marketing specific types of goods and/or services; and
- the relationship is established in a structure under common ownership, common management or common compliance control.
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
partnership
- at least two obliged entities exercise an activity in common with a view to profit or cost-sharing or achieving a common purpose; and
- the relationship is established in a structure under common ownership, common management or common compliance control.
Definition
property
Definition
management body
Definition
terrorist financing
Definition
group
Definition
money laundering
Definition
structure
- includes at least two obliged entities;
- is not a group with a parent undertaking within the meaning of Article 2(1), point (42) of Regulation (EU) 2024/1624; and
- has the objective of establishing a common framework of business, professional or commercial relationships connecting two or more obliged entities.
Definition
network
- at least two obliged entities carry out their activities in a framework which aims at cooperation and common profit- or cost-sharing, or has in place a common business strategy, or shares common compliance policies, procedures or controls, or uses a common brand or marketing name; and
- the relationship is established in a structure under common ownership, common management or common compliance control.
Definition
third country
Definition
management body in its management function
Definition
control function