Preamble Recitals

In accordance with Article 46(6)(a) of Directive (EU) 2024/1640, Article 46 of this Directive applies to the supervision of groups of obliged entities operating in both the financial and non-financial sectors. Therefore, this Regulation should specify the respective duties of the supervisors of the home and host Member States, and the modalities of their cooperation, in relation to both these sectors, without prejudice to the provisions applied in relation to the AML/CFT supervisory colleges. In doing so, this Regulation contributes to regulatory simplification by establishing a common, horizontal framework for home and host supervisory cooperation, thereby reducing fragmentation and divergence in supervisory practices across Member States.

Supervisors of the home and host Member States should apply the procedures set out in this Regulation in supervisory cooperation contexts. This may be the case in particular for the cooperation and information exchange between non-financial supervisors responsible for obliged entities in the non-financial sector that are part of structures which share common ownership, management or compliance control, including networks or partnerships.

In the cases covered by Article 2(1), point (42)(b) of Regulation (EU) 2024/1624 of the European Parliament and of the Council of 31 May 2024 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing(³), the parent undertaking and, consequently, the supervisor of the home Member State should be identified according to the criteria specified in the [Delegated Regulation transposing the draft RTS under Article 16(4) of Regulation (EU) 2024/1624](⁴).

To ensure effective supervisory cooperation across all entities within the scope of this Regulation, supervisors of the home and host Member States should apply this Regulation in a proportionate manner, taking into account the risk profile of the supervised obliged entities and groups thereof.

The supervisors of the home and host Member States should cooperate with each other, regardless of their respective nature or status. This cooperation extends throughout the supervisory life cycle and covers the exchange of relevant information that supervisors hold.

Supervisors of the home and host Member States should agree on communication modalities and keep record of their exchanges. Such modalities should be subject to appropriate security, access controls and access logs. During a transitional period and where integrated solutions or IT specfication are not in place, the supervisors may employ temporary means of receiving and transmitting cooperation requests, such as functional mailboxes.

The information that the supervisors exchange or disclose pursuant to this Regulation relates to the exercise of their supervisory tasks and does not, as a general rule, fall within the scope of legal professional privilege. If supervisors of the home and host Member States come into possession of information covered by legal privilege, they should not be required to share or disclose it in the context of group supervision.

Cooperation between supervisors of the home and host Member States may involve conducting inquiries on behalf of a requesting supervisor, or facilitating the conduct of such inquiries. Inquiries include a single request or several requests. Inquiries may include but are not limited to (a) requests by home supervisors to establish how a subsidiary applies group-wide policies, procedures and controls, and requests by supervisors to supervise the compliance of the establishments located in their Member State with Regulations (EU) 2024/1624 and (EU) 2023/1113 of the European Parliament and of the Council of 31 May 2023 on information accompanying transfers of funds and certain crypto-assets and amending Directive (EU) 2015/849(⁵), and (b) requests by supervisors in relation with requests from other comptetent bodies in their Member State, under the conditions of Article 68(3) of Directive (EU) 2024/1640. Supervisors should cooperate when conducting or facilitating the conduct of inquiries as well as regarding the subsequent exchange of the information obtained through such inquiries.

Supervisors of the home and host Member States may agree on cooperating by following a coordinated supervisory approach to the AML/CFT supervision of entities that are part of the same group, by setting out the process to be followed to ensure an effective and consistent supervision of the group. Such coordinated supervisory approach may lead to coordinated supervisory action(s), which may include coordinated or joint inspections conducted by the supervisors of the home and host Member States.

Information provided in accordance with this Regulation should be bound by professional secrecy and confidentiality requirements for all parties involved in the exchange of that information. Hence, specific provisions should be set out in this Regulation as to how this information can be further disclosed. In order to ensure the effective and efficient functioning of cooperation and information exchange between supervisors, information exchanged pursuant to Article 46 of Directive (EU) 2024/1640 may, where justified and except for information originating from third- country counterparts, be disclosed without prior consent to supervisors, including the Authority where it acts as a supervisor, or to the public authorities referred to in Article 52 of Directive (EU) 2024/1640, provided that the supervisor from which the information originated is notified accordingly. Information exchanged pursuant to Article 46 of Directive (EU) 2024/1640 may also be disclosed without the prior consent of the supervisor from which the information originated in other cases where such disclosure is authorised or required under Union law. This includes, in particular, disclosure to Financial Intelligence Units, to the competent authorities referred to in Article 2(1)(44), points (c) and (d), of Regulation (EU) 2024/1624, or to authorities responsible for implementing targeted financial sanctions as referred to in Article 66 of Directive (EU) 2024/1640, as well as the use of information received by a supervisor for the purposes set out in Article 67(3), points (b) and (c), of that Directive. In all such cases, to preserve the trust underpinning the cooperation framework, the supervisor from which the information originated should be notified of the information disclosed and of the rationale of the disclosure, to the extent possible before disclosure and at the latest at the time it takes place.

This Regulation is based on the draft regulatory technical standards submitted to the Commission by the Authority for Anti-Money Laundering and Countering the Financing of Terrorism (the ‘Authority’).

The Authority has conducted an open public consultation on the draft regulatory technical standards on which this Regulation is based and analysed the potential related costs and benefits,