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« Strikes, Collective Agreements and Freedom to Provide Services: Case C-341/05 | Main | Reform Treaty - Institutional Changes, part 5: Qualified Majority Voting »

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anon

Can anyone help with the following legal analysis?

It appears that Estonia has managed to implement EU DIRECTIVE 2005/60/EC in such an incompetent manner that they are most probably in breach of EU law.

Article 8 of EU DIRECTIVE 2005/60/EC provides, "Article 8
1. Customer due diligence measures shall comprise:
(a) identifying the customer and verifying the customer's identity on the basis of documents, data or information obtained from a reliable and independent source;
(b) identifying, where applicable, the beneficial owner and taking risk-based and adequate measures to verify his identity
so that the institution or person covered by this Directive is satisfied that it knows who the beneficial owner is, including, as regards legal persons, trusts and similar legal arrangements, taking risk-based and adequate measures to understand the ownership and control structure of the
customer;
(c) obtaining information on the purpose and intended nature of the business relationship;
(d) conducting ongoing monitoring of the business relationship including scrutiny of transactions undertaken throughout the course of that relationship to ensure that the transactions being conducted are consistent with the institution's or person's knowledge of the customer, the business and risk profile, including, where necessary, the source of funds and ensuring that the documents, data or information held
are kept up-to-date.
2. The institutions and persons covered by this Directive shall apply each of the customer due diligence requirements set
out in paragraph 1, but may determine the extent of such measures on a risk-sensitive basis depending on the type of customer, business relationship, product or transaction. The institutions and persons covered by this Directive shall be able
to demonstrate to the competent authorities mentioned in Article 37, including self-regulatory bodies, that the extent of
the measures is appropriate in view of the risks of money laundering and terrorist financing."

While the Estonian legislation has,

"Due diligence measures
15. Distinct measures for credit and financial institutions
(1) When opening an account or using another service for the first time in a credit or financial instutution, the person's identity must be verified while being in the same place with him [= face to face, customer physically present]

(8) provider of alternative payment system is required to:
1) verify every customer's identity in the same place with him when establishing a business relationship or when making a transaction with the amount exceeding 15000 EEK (~1000 EUR) in one month."

The problem is the 'face-to-face' identification procedure. It isn't practical for non-Estonian nationals to use financial institutions in Estonia.

Can anyone comment on the legal liabilities of the Estonian government?

Links - Directive http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/oj/2005/l_309/l_30920051125en00150036.pdf
Estonina legislation http://www.riigikogu.ee/?page=pub_ooc_file&op=emsplain&content_type=text/html&u=20080102124617&file_id=216274

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