To ask the Chancellor of the Exchequer whether local councillors in the UK are included in the category of politically exposed persons under the Third EU Money Laundering Directive. (118231)

I refer my hon. Friend to the answer I gave on 14 December 2006, Official Report, column 1424W, on the effect of Commission Directives 2005/60/EC and 2006/70/EC.

On 22 January the Government published draft Money Laundering Regulations 2007 for consultation. These regulations will implement the directive. Regulation 10 (5) defines a politically exposed person. The draft regulations limit the application of enhanced due diligence measures to politically exposed persons either resident abroad or entrusted with prominent public functions by a foreign state, European or international body.