The European Commission has initiated infringement proceedings against Cyprus, issuing a letter of formal notice for failing to properly incorporate EU anti-money laundering laws into national legislation, specifically regarding criminal offenses, penalties, and aggravating circumstances.

Infringement Proceedings Initiated

The European Commission launched on Wednesday infringement proceedings against Cyprus by sending a letter of formal notice over the country's failure to correctly transpose key provisions of the Directive on combating money laundering.

Affected Member States and Directive Specifics

Cyprus is among four member states, alongside Lithuania, Poland and Slovenia, that the Commission says that they have not correctly incorporated parts of the Directive (EU) 2018/1673 into national law, particularly provisions relating to money laundering offences, criminal penalties and aggravating circumstances that allow for tougher sanctions.

Core Objectives of the EU Directive

According to the EU executive, the Directive establishes common EU rules defining money laundering offences and penalties, while strengthening police and judicial cooperation across member states and preventing criminals from exploiting differences between national legal systems.

Prosecution and Penalty Provisions

Among its key provisions, the Directive also allows the prosecution of money laundering without a prior conviction for the underlying criminal offence that generated the illicit proceeds and without proving all the details of that offence. It also permits the prosecution of individuals for laundering the proceeds of their own criminal activities (self-laundering), introduces harsher penalties in specific circumstances, such as when offences are committed by persons or entities with particular professional responsibilities, including banks and notaries, and clarifies jurisdiction in cross-border cases.

Current Deficiencies and Next Legal Steps

According to the Commission, Cyprus has not fully complied with these requirements, prompting the launch of infringement proceedings through a letter of formal notice. Cyprus now has two months to respond and address the shortcomings identified by the Commission. If the response is not considered satisfactory, the Commission may proceed to the next stage of the infringement process by issuing a reasoned opinion.

Source: CNA(ΚΥΠΕ)