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House of Commons Hansard
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06 March 2007
Volume 457
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To ask the Chancellor of the Exchequer (1) whether he interpreted the requirements set out in Article 16(1)(a) and (b) of the Third Money Laundering Directive to apply to (a) institutions and persons listed in Article 2 and (b) institutions and persons situated in third countries for the purposes of drafting the Money Laundering Regulations 2007; [125090]

(2) for what reasons the exemption from the requirement to report information received in professionally privileged circumstances in Regulation 7 of the Money Laundering Regulations 2003 is not included in the Draft Money Laundering Regulations 2007;

(3) if he will amend the draft Money Laundering Regulations 2007 to include rules to be followed (a) for calculating the 25 per cent. share of the beneficial interest in property held under a trust, as provided for in Article 3(6)(b)(i), and (b) in determining whether a person exercises control over 25 per cent. of trust property within the meaning of Article 3(6)(b)(iii) of the Third Money Laundering Directive;

(4) if he will amend Regulation 12 of the Draft Money Laundering Regulations 2007 to make explicit that regulated parties may rely on regulated persons situated in other member states for customer due diligence checks including where documents or data are different in form to those required in the UK.

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The Government are currently consulting on draft Money Laundering Regulations 2007. The consultation closes on 2 April. The Government will make final decisions, including in relation to the definition of beneficial owner and the provisions contained in regulation 12, once they have considered all consultation responses.

The Government consider that the requirements set out in article 16(1)(a) and (b) of the Third Money Laundering Directive apply to institutions and persons listed in article 2 and equivalent institutions and persons situated in third countries.

The exemption for legal professional privilege in regulation 7 of the Money Laundering Regulations 2003 is based on the exemption in part 7 of the Proceeds of Crime Act 2002. The draft Money Laundering Regulations 2007, unlike the 2003 regulations, provide for internal reporting procedures in respect of the requirements of part 7 of the Act, and therefore it is unnecessary to set out this exemption or other provisions set out in part 7.