Wholesalers are no longer liable under the Anti-Money Laundering Measures Act

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On January 13th, 2021, amendments to the Anti-Money Laundering Measures Act (AMLMA) were adopted at second reading at the Parliament. According to the changes wholesale traders are no longer obliged under this act. They will no longer have the obligations to perform complex due diligence on their clients, to collect and store information about suspicious transactions and operations, etc.

The MPs who submitted the project point out that the changes are aimed at reducing the administrative burden for a certain category of obligated entities – wholesalers, without affecting the objectives pursued by the law. In view of this, it was necessary to repeal the text of Art. 4 item 19 of the AMLMA, which explicitly stated that the measures for prevention of the use of the financial system for the purposes of money laundering are mandatory for wholesalers.

On the grounds of the bill finally adopted (since another large-scale project was also submitted by the Council of Ministers*), regarding wholesale traders – the MPs state that the law does not distinguish the different Bulgarian traders according to the type and value of the goods, by treating them unequally as compared  to their European colleagues. Furthermore, a major argument was brought-up stating that the European anti-money laundering directive as of 2015 does not explicitly include wholesalers, but imposes requirements for “other persons trading with goods when cash payments are made or received in the amount of EUR 10,000 or more ”.

At the same time, according to the Restrictions on Cash Payments Act, these amounts in Bulgaria are limited to BGN 10,000, equal to EUR 5,112.92 at the fixed exchange rate of the BNB, therefore, the requirement under the EU directive is not applicable.

The traders of arms, oil and petroleum products remain within the scope of the AMLMA (Art. 4, item 20 of the AMLMA), as there is a clear specification regarding the nature of the goods traded.


* A bill for amendment of the same act has been submitted by the Council of Ministers. The latter proposes exclusion of wholesalers, but, as well as that, it excludes other entities obliged, such as: privatization bodies, reinsuring cojmpanies, tender procedure assignors, ministers and mayors upon conclusion of concession contracts. The government also offers exclusion to all professional sports clubs, except for football clubs. At the same time, the Anti – Corruption Commission refused to agree to this project precisely in the part for traders, reinsuring companies, ministers and mayors. This draft is still under discussion withing the Parliament at first reading.

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