Regulation (EC) No 1781/2006 of the European Parliament and of the Council of 15 November 2006 on information on the payer accompanying transfers of funds   (Text with EEA relevance)
Date: 2006-11-15
Institutions: Council of the European Union, European Parliament
Subjects: capital transfer, credit transfer, disclosure of information, fight against crime, financial institution, judicial cooperation in criminal matters in the EU, money laundering, terrorism

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I

(Acts whose publication is obligatory)

REGULATION (EC) No 1781/2006 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 15 November 2006

on information on the payer accompanying transfers of funds

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EURO-
PEAN UNION,

Having regard to the Treaty establishing the European Commu-
nity, and in particular Article 95 thereof,

national payments within a Member State and cross-
border payments between Member States. Uncoordinated
action by Member States alone in the field of cross-border
transfers of funds could have a significant impact on the
smooth functioning of payment systems at EU level, and
therefore damage the internal market in the field of finan-
cial services.

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Central Bank (1),

Acting in accordance with the procedure laid down in Article 251
of the Treaty (2),

Whereas:

(1)

(2)

Flows of dirty money through transfers of funds can dam-
age the stability and reputation of the financial sector and
threaten the internal market. Terrorism shakes the very
foundations of our society. The soundness, integrity and
stability of the system of transfers of funds and confidence
in the financial system as a whole could be seriously jeop-
ardised by the efforts of criminals and their associates
either to disguise the origin of criminal proceeds or to
transfer funds for terrorist purposes.

In order to facilitate their criminal activities, money laun-
derers and terrorist financers could try to take advantage
of the freedom of capital movements entailed by the inte-
grated financial area, unless certain coordinating measures
are adopted at Community level. By its scale, Community
action should ensure that Special Recommendation VII on
wire transfers (SR VII) of the Financial Action Task Force
(FATF) established by the Paris G7 Summit of 1989 is
transposed uniformly throughout the European Union,
and, in particular, that there is no discrimination between

(3)

(4)

In the wake of the terrorist attacks in the USA on 11 Sep-
tember 2001, the extraordinary European Council on
21 September 2001 reiterated that the fight against terror-
ism is a key objective of the European Union. The Euro-
pean Council approved a plan of action dealing with
enhanced police and judicial cooperation, developing
international legal instruments against terrorism, prevent-
ing terrorist funding, strengthening air security and greater
consistency between all relevant policies. This plan of
action was revised by the European Council following the
terrorist attacks of 11 March 2004 in Madrid, and now
specifically addresses the need to ensure that the legisla-
tive framework created by the Community for the pur-
pose of combating terrorism and improving judicial
cooperation is adapted to the nine Special Recommenda-
tions against Terrorist Financing adopted by the FATF.

In order to prevent terrorist funding, measures aimed at
the freezing of funds and economic resources of certain
persons, groups and entities have been taken, including
Regulation (EC) No 2580/2001 (3), and Council Regula-
tion (EC) No 881/2002 (4). To that same end, measures
aimed at protecting the financial system against the chan-
nelling of funds and economic resources for terrorist pur-
poses have been taken. Directive 2005/60/EC of the
European Parliament and of the Council (5) contains a
number of measures aimed at combating the misuse of
the financial system for the purpose of money laundering
and terrorist financing. Those measures do not, however,
fully prevent terrorists and other criminals from having
access to payment systems for moving their funds.

(1) OJ C 336, 31.12.2005, p. 109.
(2) Opinion of the European Parliament delivered on 6 July 2006 (not
yet published in the Official Journal) and Council Decision delivered
on 7 November 2006.

(3) OJ L 344, 28.12.2001, p. 70. Regulation as last amended by Com-
mission Regulation (EC) No 1461/2006 (OJ L 272, 3.10.2006, p. 11).
(4) OJ L 139, 29.5.2002, p. 9. Regulation as last amended by Commis-
sion Regulation (EC) No 1508/2006 (OJ L 280, 12.10.2006, p. 12).

(5) OJ L 309, 25.11.2005, p. 15.

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(5)

(6)

(7)

(8)

(9)

In order to foster a coherent approach in the international
context in the field of combating money laundering and
terrorist financing, further Community action should take
account of developments at that level, namely the nine
Special Recommendations against Terrorist Financing
adopted by the FATF, and in particular SR VII and the
revised interpretative note for its implementation.

(10)

(11)

The full traceability of transfers of funds can be a particu-
larly important and valuable tool in the prevention, inves-
tigation and detection of money laundering or terrorist
financing. It is therefore appropriate, in order to ensure
the transmission of information on the payer throughout
the payment chain, to provide for a system imposing the
obligation on payment service providers to have transfers
of funds accompanied by accurate and meaningful infor-
mation on the payer.

The provisions of this Regulation apply without prejudice
to Directive 95/46/EC of the European Parliament and of
the Council (1). For example, information collected and
kept for the purpose of this Regulation should not be used
for commercial purposes.

Persons who merely convert paper documents into elec-
tronic data and are acting under a contract with a pay-
ment service provider do not fall within the scope of this
Regulation; the same applies to any natural or legal per-
son who provides payment service providers solely with
messaging or other support systems for transmitting funds
or with clearing and settlement systems.

It is appropriate to exclude from the scope of this Regu-
lation transfers of funds that represent a low risk of money
laundering or terrorist financing. Such exclusions should
cover credit or debit cards, Automated Teller Machine
(ATM) withdrawals, direct debits, truncated cheques, pay-
ments of taxes, fines or other levies, and transfers of funds
where both the payer and the payee are payment service
providers acting on their own behalf. In addition, in order
to reflect the special characteristics of national payment
systems, Member States may exempt electronic giro pay-
ments, provided that it is always possible to trace the
transfer of funds back to the payer. Where Member States
have applied the derogation for electronic money in
Directive 2005/60/EC, it should be applied under this
Regulation, provided the amount transacted does not
exceed EUR 1 000.

The exemption for electronic money, as defined by
Directive 2000/46/EC of the European Parliament and of
the Council (2), covers electronic money irrespective of
whether the issuer of such money benefits from a waiver
under Article 8 of that Directive.

In order not to impair the efficiency of payment systems,
the verification requirements for transfers of funds made
from an account should be separate from those for trans-
fers of funds not made from an account. In order to bal-
ance the risk of driving transactions underground by
imposing overly strict identification requirements against
the potential terrorist threat posed by small transfers of
funds, the obligation to check whether the information on
the payer is accurate should, in the case of transfers of
funds not made from an account, be imposed only in
respect of
funds that exceed
EUR 1 000, without prejudice to the obligations under
Directive 2005/60/EC. For transfers of funds made from
an account, payment service providers should not be
required to verify information on the payer accompany-
ing each transfer of funds, where the obligations under
Directive 2005/60/EC have been met.

transfers of

individual

(12) Against the background of Regulation (EC) No 2560/2001
of the European Parliament and of the Council (3) and the
Commission Communication ‘A New Legal Framework
for Payments in the Internal Market’, it is sufficient to pro-
vide for simplified information on the payer to accom-
pany transfers of funds within the Community.

(13)

(14)

(15)

In order to allow the authorities responsible for combat-
ing money laundering or terrorist financing in third coun-
tries to trace the source of funds used for those purposes,
transfers of funds from the Community to outside the
Community should carry complete information on the
payer. Those authorities should be granted access to com-
plete information on the payer only for the purposes of
preventing, investigating and detecting money laundering
or terrorist financing.

For transfers of funds from a single payer to several pay-
ees to be sent in an inexpensive way in batch files contain-
ing individual transfers from the Community to outside
the Community, provision should be made for such indi-
vidual transfers to carry only the account number of the
payer or a unique identifier provided that the batch file
contains complete information on the payer.

In order to check whether the required information on the
payer accompanies transfers of funds, and to help to iden-
tify suspicious transactions, the payment service provider
of the payee should have effective procedures in place in
order to detect whether information on the payer is
missing.

(1) OJ L 281, 23.11.1995, p. 31. Directive as amended by Regula-

tion (EC) No 1882/2003 (OJ L 284, 31.10.2003, p. 1).

(2) OJ L 275, 27.10.2000, p. 39.
(3) Regulation as corrected by OJ L 344, 28.12.2001, p. 13.

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(16) Owing to the potential terrorist financing threat posed by
anonymous transfers, it is appropriate to enable the pay-
ment service provider of the payee to avoid or correct such
situations when it becomes aware that information on the
payer is missing or incomplete. In this regard, flexibility
should be allowed as concerns the extent of information
on the payer on a risk-sensitive basis. In addition, the accu-
racy and completeness of information on the payer should
remain the responsibility of the payment service provider
of the payer. Where the payment service provider of the
payer is situated outside the territory of the Community,
enhanced customer due diligence should be applied, in
accordance with Directive 2005/60/EC,
in respect of
cross-border correspondent banking relationships with
that payment service provider.

(17) Where guidance is given by national competent authori-
ties as regards the obligations either to reject all transfers
from a payment service provider which regularly fails to
supply the required information on the payer or to decide
whether or not to restrict or terminate a business relation-
ship with that payment service provider, it should inter
alia be based on the convergence of best practices and
should also take into account the fact that the revised
interpretative note to SR VII of the FATF allows third
countries to set a threshold of EUR 1 000 or USD 1 000
for the obligation to send information on the payer, with-
out prejudice to the objective of efficiently combating
money laundering and terrorist financing.

(21)

(22)

technical limitations should be removed as soon as pay-
ment systems are upgraded.

Since in criminal investigations it may not be possible to
identify the data required or the individuals involved until
many months, or even years, after the original transfer of
funds, it is appropriate to require payment service provid-
ers to keep records of information on the payer for the
purposes of preventing, investigating and detecting money
laundering or terrorist financing. This period should be
limited.

To enable prompt action to be taken in the fight against
terrorism, payment service providers should respond
promptly to requests for information on the payer from
the authorities responsible for combating money launder-
ing or terrorist financing in the Member State where they
are situated.

(23)

The number of working days in the Member State of the
payment service provider of the payer determines the
number of days to respond to requests for information on
the payer.

(24) Given the importance of the fight against money launder-
ing and terrorist financing, Member States should lay
down effective, proportionate and dissuasive penalties in
national law for failure to comply with this Regulation.

(18)

In any event, the payment service provider of the payee
should exercise special vigilance, assessing the risks, when
it becomes aware that information on the payer is miss-
ing or incomplete, and should report suspicious transac-
tions to the competent authorities, in accordance with the
reporting obligations set out in Directive 2005/60/EC and
national implementing measures.

(25)

The measures necessary for the implementation of this
Regulation should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999 laying down the
procedures for the exercise of implementing powers con-
ferred on the Commission (1).

(19)

The provisions on transfers of funds where information
on the payer is missing or incomplete apply without preju-
dice to any obligations on payment service providers to
suspend and/or reject transfers of funds which violate pro-
visions of civil, administrative or criminal law.

(20) Until technical limitations that may prevent intermediary
payment service providers from satisfying the obligation
to transmit all the information they receive on the payer
are removed, those intermediary payment service pro-
viders should keep records of that information. Such

(26) A number of countries and territories which do not form
part of the territory of the Community share a monetary
union with a Member State, form part of the currency area
of a Member State or have signed a monetary convention
with the European Community represented by a Member
State, and have payment service providers that participate
directly or indirectly in the payment and settlement sys-
tems of that Member State. In order to avoid the applica-
tion of this Regulation to transfers of funds between the
Member States concerned and those countries or territo-
ries having a significant negative effect on the economies
of those countries or territories, it is appropriate to pro-
vide for the possibility for such transfers of funds to be
treated as transfers of funds within the Member States
concerned.

(1) OJ L 184, 17.7.1999, p. 23. Decision as

last amended by

Decision 2006/512/EC (OJ L 200, 22.7.2006, p. 11).

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(27)

(28)

In order not to discourage donations for charitable pur-
poses, it is appropriate to authorise Member States to
exempt payment services providers situated in their terri-
tory from collecting, verifying, recording, or sending infor-
mation on the payer for transfers of funds up to a
maximum amount of EUR 150 executed within the terri-
tory of that Member State. It is also appropriate to make
this option conditional upon requirements to be met by
non-profit organisations, in order to allow Member States
to ensure that this exemption does not give rise to abuse
by terrorists as a cover for or a means of facilitating the
financing of their activities.

Since the objectives of this Regulation cannot be suffi-
ciently achieved by the Member States and can therefore,
by reason of the scale or effects of the action, be better
achieved at Community level, the Community may adopt
measures, in accordance with the principle of subsidiarity
as set out in Article 5 of the Treaty. In accordance with
the principle of proportionality, as set out in that Article,
this Regulation does not go beyond what is necessary in
order to achieve those objectives.

(29)

In order to establish a coherent approach in the field of
combating money laundering and terrorist financing, the
main provisions of this Regulation should apply from the
same date as the relevant provisions adopted at interna-
tional level,

HAVE ADOPTED THIS REGULATION:

CHAPTER I

SUBJECT MATTER, DEFINITIONS AND SCOPE

(3)

‘payer’ means either a natural or legal person who holds an
account and allows a transfer of funds from that account,
or, where there is no account, a natural or legal person who
places an order for a transfer of funds;

(4)

‘payee’ means a natural or legal person who is the intended
final recipient of transferred funds;

(5)

‘payment service provider’ means a natural or legal person
whose business includes the provision of transfer of funds
services;

(6)

‘intermediary payment service provider’ means a payment
service provider, neither of the payer nor of the payee, that
participates in the execution of transfers of funds;

(7)

‘transfer of funds’ means any transaction carried out on
behalf of a payer through a payment service provider by elec-
tronic means, with a view to making funds available to a
payee at a payment service provider, irrespective of whether
the payer and the payee are the same person;

(8)

‘batch file transfer’ means several individual transfers of funds
which are bundled together for transmission;

(9)

‘unique identifier’ means a combination of letters, numbers
or symbols, determined by the payment service provider, in
accordance with the protocols of the payment and settle-
ment system or messaging system used to effect the transfer
of funds.

Article 1

Subject matter

Article 3

Scope

This Regulation lays down rules on information on the payer to
accompany transfers of funds for the purposes of the preven-
tion, investigation and detection of money laundering and terror-
ist financing.

This Regulation shall apply to transfers of funds, in any
1.
currency, which are sent or received by a payment service pro-
vider established in the Community.

Article 2

Definitions

This Regulation shall not apply to transfers of funds car-

2.
ried out using a credit or debit card, provided that:

For the purposes of this Regulation, the following definitions
shall apply:

(a)

the payee has an agreement with the payment service pro-
vider permitting payment for the provision of goods and
services;

(1)

(2)

‘terrorist financing’ means the provision or collection of
funds within the meaning of Article 1(4) of Directive
2005/60/EC;

and

‘money laundering’ means any conduct which, when com-
mitted intentionally, is regarded as money laundering for the
purposes of Article 1(2) or (3) of Directive 2005/60/EC;

(b) a unique identifier, allowing the transaction to be traced back

to the payer, accompanies such transfer of funds.

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3. Where a Member State chooses to apply the derogation set
out in Article 11(5)(d) of Directive 2005/60/EC, this Regulation
shall not apply to transfers of funds using electronic money cov-
ered by that derogation, except where the amount transferred
exceeds EUR 1 000.

(b) where there is a debit transfer authorisation between two
parties permitting payments between them through
accounts, provided that a unique identifier accompanies the
transfer of funds, enabling the natural or legal person to be
traced back;

4. Without prejudice to paragraph 3, this Regulation shall not
apply to transfers of funds carried out by means of a mobile tele-
phone or any other digital or Information Technology (IT) device,
when such transfers are pre-paid and do not exceed EUR 150.

5.
This Regulation shall not apply to transfers of funds car-
ried out by means of a mobile telephone or any other digital or
IT device, when such transfers are post-paid and meet all of the
following conditions:

(a)

the payee has an agreement with the payment service pro-
vider permitting payment for the provision of goods and
services;

(b) a unique identifier, allowing the transaction to be traced back

to the payer, accompanies the transfer of funds;

and

(c)

the payment service provider is subject to the obligations set
out in Directive 2005/60/EC.

6. Member States may decide not to apply this Regulation to
transfers of funds within that Member State to a payee account
permitting payment for the provision of goods or services if:

(c) where truncated cheques are used;

(d)

to public authorities for taxes, fines or other levies within a
Member State;

(e) where both the payer and the payee are payment service

providers acting on their own behalf.

CHAPTER II

OBLIGATIONS ON THE PAYMENT SERVICE PROVIDER
OF THE PAYER

Article 4

Complete information on the payer

Complete information on the payer shall consist of his

1.
name, address and account number.

2.
The address may be substituted with the date and place of
birth of the payer, his customer identification number or national
identity number.

3. Where the payer does not have an account number, the
payment service provider of the payer shall substitute it by a
unique identifier which allows the transaction to be traced back
to the payer.

(a)

the payment service provider of the payee is subject to the
obligations set out in Directive 2005/60/EC;

Information accompanying transfers of funds and record
keeping

Article 5

(b)

the payment service provider of the payee is able by means
of a unique reference number to trace back, through the
payee, the transfer of funds from the natural or legal person
who has an agreement with the payee for the provision of
goods and services;

and

(c)

the amount transacted is EUR 1 000 or less.

Member States making use of this derogation shall inform the
Commission thereof.

1.
Payment service providers shall ensure that transfers of
funds are accompanied by complete information on the payer.

2.
The payment service provider of the payer shall, before
transferring the funds, verify the complete information on the
payer on the basis of documents, data or information obtained
from a reliable and independent source.

In the case of transfers of funds from an account, verifica-

3.
tion may be deemed to have taken place if:

(a) a payer’s identity has been verified in connection with the
opening of the account and the information obtained by this
verification has been stored in accordance with the obliga-
tions set out
in Articles 8(2) and 30(a) of Directive
2005/60/EC;

7.

This Regulation shall not apply to transfers of funds:

or

(a) where the payer withdraws cash from his or her own

account;

(b)

the payer falls within the scope of Article 9(6) of Directive
2005/60/EC.

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However, without prejudice to Article 7(c) of Directive
4.
2005/60/EC, in the case of transfers of funds not made from an
account, the payment service provider of the payer shall verify
the information on the payer only where the amount exceeds
EUR 1 000, unless the transaction is carried out in several opera-
tions that appear to be linked and together exceed EUR 1 000.

payer have been completed using the characters or inputs admis-
sible within the conventions of that messaging or payment and
settlement system. Such provider shall have effective procedures
in place in order to detect whether the following information on
the payer is missing:

5.
The payment service provider of the payer shall for five
years keep records of complete information on the payer which
accompanies transfers of funds.

(a)

for transfers of funds where the payment service provider
of the payer is situated in the Community, the information
required under Article 6;

Article 6

Transfers of funds within the Community

1.
By way of derogation from Article 5(1), where both the
payment service provider of the payer and the payment service
provider of the payee are situated in the Community, transfers
of funds shall be required to be accompanied only by the account
number of the payer or a unique identifier allowing the transac-
tion to be traced back to the payer.

(b)

for transfers of funds where the payment service provider
of the payer is situated outside the Community, complete
information on the payer as referred to in Article 4, or where
applicable, the information required under Article 13;

and

2.
However, if so requested by the payment service provider
of the payee, the payment service provider of the payer shall
make available to the payment service provider of the payee com-
plete information on the payer, within three working days of
receiving that request.

(c)

for batch file transfers where the payment service provider
of the payer is situated outside the Community, complete
information on the payer as referred to in Article 4 in the
batch file transfer only, but not in the individual transfers
bundled therein.

Article 7

Transfers of funds from the Community to outside the
Community

1.
Transfers of funds where the payment service provider of
the payee is situated outside the Community shall be accompa-
nied by complete information on the payer.

2.
In the case of batch file transfers from a single payer where
the payment service providers of the payees are situated outside
the Community, paragraph 1 shall not apply to the individual
transfers bundled together therein, provided that the batch file
contains that information and that the individual transfers carry
the account number of the payer or a unique identifier.

Article 9

Transfers of funds with missing or incomplete
information on the payer

1.
If the payment service provider of the payee becomes
aware, when receiving transfers of funds, that information on the
payer required under this Regulation is missing or incomplete, it
shall either reject the transfer or ask for complete information
on the payer. In any event, the payment service provider of the
payee shall comply with any applicable law or administrative
provisions relating to money laundering and terrorist financing,
in particular, Regulations
(EC) No 2580/2001 and (EC)
No 881/2002, Directive 2005/60/EC and any national imple-
menting measures.

CHAPTER III

OBLIGATIONS ON THE PAYMENT SERVICE PROVIDER
OF THE PAYEE

Article 8

Detection of missing information on the payer

2. Where a payment service provider regularly fails to supply
the required information on the payer, the payment service pro-
vider of the payee shall take steps, which may initially include
the issuing of warnings and setting of deadlines, before either
rejecting any future transfers of funds from that payment service
provider or deciding whether or not to restrict or terminate its
business relationship with that payment service provider.

The payment service provider of the payee shall detect whether,
in the messaging or payment and settlement system used to effect
a transfer of funds, the fields relating to the information on the

The payment service provider of the payee shall report that fact
to the authorities responsible for combating money laundering
or terrorist financing.

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Article 10

Risk-based assessment

The payment service provider of the payee shall consider miss-
ing or incomplete information on the payer as a factor in assess-
ing whether the transfer of funds, or any related transaction, is
suspicious, and whether it must be reported, in accordance with
the obligations set out in Chapter III of Directive 2005/60/EC,
to the authorities responsible for combating money laundering
or terrorist financing.

4. Where the intermediary payment service provider uses a
payment system with technical limitations, the intermediary pay-
ment service provider shall, upon request from the payment ser-
vice provider of the payee, make available to that payment service
provider all the information on the payer which it has received,
irrespective of whether it is complete or not, within three work-
ing days of receiving that request.

In the cases referred to in paragraphs 2 and 3, the interme-
5.
diary payment service provider shall for five years keep records
of all information received.

Article 11

Record keeping

The payment service provider of the payee shall for five years
keep records of any information received on the payer.

CHAPTER IV

OBLIGATIONS ON INTERMEDIARY PAYMENT SERVICE
PROVIDERS

Article 12

Keeping information on the payer with the transfer

Intermediary payment service providers shall ensure that all infor-
mation received on the payer that accompanies a transfer of
funds is kept with the transfer.

Article 13

Technical limitations

CHAPTER V

GENERAL OBLIGATIONS AND IMPLEMENTING POWERS

Article 14

Cooperation obligations

Payment service providers shall respond fully and without delay,
in accordance with the procedural requirements established in
the national law of the Member State in which they are situated,
to enquiries from the authorities responsible for combating
money laundering or terrorist financing of that Member State
concerning the information on the payer accompanying trans-
fers of funds and corresponding records.

Without prejudice to national criminal law and the protection
of fundamental rights, those authorities may use that informa-
tion only for the purposes of preventing, investigating or detect-
ing money laundering or terrorist financing.

1.
This Article shall apply where the payment service provider
of the payer is situated outside the Community and the interme-
diary payment service provider is situated within the Community.

Article 15

Penalties and monitoring

2.
Unless the intermediary payment service provider becomes
aware, when receiving a transfer of funds, that information on
the payer required under this Regulation is missing or incom-
plete, it may use a payment system with technical limitations
which prevents information on the payer from accompanying
the transfer of funds to send transfers of funds to the payment
service provider of the payee.

3. Where the intermediary payment service provider becomes
aware, when receiving a transfer of funds, that information on
the payer required under this Regulation is missing or incom-
plete, it shall only use a payment system with technical limita-
tions if it is able to inform the payment service provider of the
payee thereof, either within a messaging or payment system that
provides for communication of this fact or through another pro-
cedure, provided that the manner of communication is accepted
by, or agreed between, both payment service providers.

1. Member States shall lay down the rules on penalties appli-
cable to infringements of the provisions of this Regulation and
shall take all measures necessary to ensure that they are imple-
mented. Such penalties shall be effective, proportionate and dis-
suasive. They shall apply from 15 December 2007.

2. Member States shall notify the Commission of the rules
referred to in paragraph 1 and the authorities responsible for
their application by 14 December 2007at the latest, and shall
notify it without delay of any subsequent amendment affecting
them.

3. Member States shall require competent authorities to effec-
tively monitor, and take necessary measures with a view to ensur-
ing, compliance with the requirements of this Regulation.

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Article 16

Committee procedure

The Commission shall be assisted by the Committee on the
1.
Prevention of Money Laundering and Terrorist Financing estab-
lished by Directive 2005/60/EC, hereinafter referred to as ‘the
Committee’.

2. Where reference is made to this paragraph, Articles 5 and 7
of Decision 1999/468/EC shall apply, having regard to the pro-
visions of Article 8 thereof and provided that the implementing
measures adopted in accordance with this procedure do not
modify the essential provisions of this Regulation.

The period laid down in Article 5(6) of Decision 1999/468/EC
shall be set at three months.

CHAPTER VI

DEROGATIONS

Article 17

Agreements with territories or countries which do not
form part of the territory of the Community

1.
The Commission may authorise any Member State to con-
clude agreements, under national arrangements, with a country
or territory which does not form part of the territory of the Com-
munity as determined in accordance with Article 299 of the
Treaty, which contain derogations from this Regulation, in order
to allow for transfers of funds between that country or territory
and the Member State concerned to be treated as transfers of
funds within that Member State.

Such agreements may be authorised only if:

(a)

the country or territory concerned shares a monetary union
with the Member State concerned, forms part of the cur-
rency area of that Member State or has signed a Monetary
Convention with the European Community represented by
a Member State;

(b) payment service providers in the country or territory con-
cerned participate directly or indirectly in payment and
settlement systems in that Member State;

and

(c)

the country or territory concerned requires payment service
providers under its jurisdiction to apply the same rules as
those established under this Regulation.

Upon receipt by the Commission of an application from a Mem-
ber State, transfers of funds between that Member State and the
country or territory concerned shall be provisionally treated as
transfers of funds within that Member State, until a decision is
reached in accordance with the procedure set out in this Article.

If the Commission considers that it does not have all the neces-
sary information, it shall contact the Member State concerned
within two months of receipt of the application and specify the
additional information required.

Once the Commission has all the information it considers neces-
sary for appraisal of the request, it shall within one month notify
the requesting Member State accordingly and shall transmit the
request to the other Member States.

3. Within three months of the notification referred to in the
fourth subparagraph of paragraph 2, the Commission shall
decide,
in accordance with the procedure referred to in
Article 16(2), whether to authorise the Member State concerned
to conclude the agreement referred to in paragraph 1 of this
Article.

In any event, a decision as referred to in the first subparagraph
shall be adopted within eighteen months of receipt of the appli-
cation by the Commission.

Article 18

Transfers of funds to non-profit organisations within a
Member State

1. Member States may exempt payment service providers situ-
ated in their territory from the obligations set out in Article 5, as
regards transfers of funds to organisations carrying out activities
for non-profit charitable, religious, cultural, educational, social,
scientific or fraternal purposes, provided that those organisations
are subject to reporting and external audit requirements or super-
vision by a public authority or self-regulatory body recognised
under national law and that those transfers of funds are limited
to a maximum amount of EUR 150 per transfer and take place
exclusively within the territory of that Member State.

2. Member States making use of this Article shall communi-
cate to the Commission the measures that they have adopted for
applying the option provided for in paragraph 1, including a list
of organisations covered by the exemption, the names of the
natural persons who ultimately control those organisations and
an explanation of how the list will be updated. That information
shall also be made available to the authorities responsible for
combating money laundering and terrorist financing.

2.
Any Member State wishing to conclude an agreement as
referred to in paragraph 1 shall send an application to the Com-
mission and provide it with all the necessary information.

3.
An up-to-date list of organisations covered by the exemp-
tion shall be communicated by the Member State concerned to
the payment service providers operating in that Member State.

8.12.2006

EN

Official Journal of the European Union

L 345/9

Article 19

Review clause

1.
By 28 December 2011 the Commission shall present a
report to the European Parliament and to the Council giving a
full economic and legal assessment of the application of this
Regulation, accompanied, if appropriate, by a proposal for its
modification or repeal.

2.

That report shall in particular review:

(a)

the application of Article 3 with regard to further experi-
ence of the possible misuse of electronic money, as defined
in Article 1(3) of Directive 2000/46/EC, and other newly-
developed means of payment, for the purposes of money
laundering and terrorist financing. Should there be a risk of
such misuse, the Commission shall submit a proposal to
amend this Regulation;

(b)

the application of Article 13 with regard to the technical
limitations which may prevent complete information on the
payer from being transmitted to the payment service pro-
vider of the payee. Should it be possible to overcome such
technical limitations in the light of new developments in the
payments area, and taking into account related costs for pay-
ment service providers, the Commission shall submit a pro-
posal to amend this Regulation.

CHAPTER VII

FINAL PROVISIONS

Article 20

Entry into force

This Regulation shall enter into force on the 20th day following
the day of its publication in the Official Journal of the European
Union, but in any event not before 1 January 2007.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Strasbourg, 15 November 2006.

For the European Parliament
The President
J. BORRELL FONTELLES

For the Council
The President
P. LEHTOMÄKI