REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL assessing the necessity and proportionality of harmonising the information included in the real estate registers and assessing the need for the interconnection of those registers
Date: 2022-03-09
Institutions: Directorate-General for Financial Stability, Financial Services and Capital Markets Union, European Commission
Subjects: access to information, administrative cooperation, approximation of laws, land register, money laundering, real property, terrorism financing

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 9.3.2022  COM(2022) 87 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL assessing the necessity and proportionality of harmonising the information included in the real estate registers and assessing the need for the interconnection of those registers  
 
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

assessing the necessity and proportionality of harmonising the information included in 
the real estate registers and assessing the need for the interconnection of those registers 

1. 

INTRODUCTION  

Article  32b(2)  of  Directive  (EU)  2015/8491  (the  “Anti-Money  Laundering  Directive”  or 
“AMLD”) as amended by Directive (EU) 2018/8432 (“AMLD5”) requires the Commission to 
submit  a  report  to  the  European  Parliament  and  to  the  Council  assessing  the  necessity  and 
proportionality  of  harmonising  the  information  included  in  national  real  estate  registers  of 
Member  States  and  assessing  the  need  for  the  interconnection  of  those  registers. 
Notwithstanding that the deadline for submission of this report was set at 31 December 2020, 
the Commission chose to put its adoption on hold so that the assessment could be taken into 
account  in  the  preparation  of  the  anti-money  laundering  and  countering  the  financing  of 
terrorism (AML/CFT) package of legislative proposals it adopted on 20 July 20213.  

The  AMLD  includes  a  number  of  measures  to  address  and  mitigate  money  laundering  and 
terrorist financing (ML/TF) risks in the real estate sector. These  encompass the inclusion of 
notaries and other legal professionals participating in real estate transactions, as well as real 
estate agents within the scope of the entities subject to AML/CFT obligations and, following 
changes  introduced  by  AMLD5,  making  information  on  real  estate  ownership  available  for 
national AML/CFT authorities. Article 32(b)(1) of AMLD requires Member States to provide 
Financial  Intelligence  Units  (FIUs)  and  competent  authorities  with  access  to  information 
which allows the identification in a timely manner of any natural or legal persons owning real 
estate, including through registers or electronic data retrieval systems where such registers or 
systems are available. 

In order to fulfil the  requirements of Article 32(b)(2), this report includes (i) an analysis of 
the  current  state  of  play  of  land  registers,  (ii)  a  description  of  how  access  to  real  estate 
registers can assist FIUs and competent authorities, as well as (iii) the assessment of benefits, 
weakness  and  requirements  for  both  harmonisation  of  information  included  in  the  registers 
and the interconnection  of such registers. Based  on these elements,  an initial  assessment of 
proportionality and necessity of harmonisation and interconnection is made. 

1 
Directive  (EU)  2015/849  of  the  European  Parliament  and  of  the  Council  of  20  May  2015  on  the 
prevention  of  the  use  of  the  financial  system  for  the  purposes  of  money  laundering  or  terrorist  financing, 
amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 
2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC (Text with 
EEA  relevance),  OJ  L  141,  5.6.2015,  p.  73–117,  as  amended  by  Directive  (EU)  2018/843  of  the  European 
Parliament and of the Council of 30 May 2018. 
2 
Directive  (EU)  2018/843  of  the  European  Parliament  and  of  the  Council  of  30  May  2018  amending 
Directive  (EU)  2015/849  on  the  prevention  of  the  use  of  the  financial  system  for  the  purposes  of  money 
laundering or terrorist financing, and amending Directives 2009/138/EC and 2013/36/EU, OJ L156, 19.6.2018, 
p. 43-74. 
3 

https://ec.europa.eu/info/publications/210720-anti-money-laundering-countering-financing-terrorism_en 

1 

 
 
 
 
 
                                                 
The preparation of this report was assisted by an independent study by an external contractor 
commissioned  in  20204.  The  study  mapped  information  on  the  Member  States’  real  estate 
registers, analysed past and current initiatives to interconnect the registers and harmonise the 
information they contain. This report is also built on information from a study commissioned 
by  the  Commission  in  20145  that  presented  the  results  of  a  business  and  a  technical  study 
forming the preliminary work toward building a land register interconnection in the European 
e-Justice Portal. 

This  report  uses  the  term  “real  estate  register”  as  a  term  covering  both  land  registers6  and 
cadastre  registers7,  which  can  both  include  information  allowing  the  identification  of  a 
natural  or  legal  person  owning  real  estate.  Those  registers  generally  operate  in  a 
complementary  fashion,  with  land  registers  providing  official  recording  of  rights  through 
deeds or title and cadastres offering a public inventory of real property. In practical terms, in 
any  potential  harmonisation  and/or  interconnection  project,  the  Member  States  should 
identify  the  relevant  national  registers  on  a  case-by-case  basis  and  include  both  land  and 
cadastre registers if those are distinct under their national law. 

2.  STATE OF PLAY 

2.1.  Registers containing information on real estate owners in Member States 

The  real  estate  registers  in  Member  States  vary  considerably  in  terms  of  organisation, 
centralisation, the digitalisation level and their respective content.  

Most Member States have organised data concerning real estate property in two registers – a 
land  register  and  a  cadastre  register.  Eight  Member  States  manage  their  land  registers 
together  with  the  cadastre8.  Some  Member  States  have  also  chosen  to  set  up  separate 
databases for special purposes – for example, for tax identification of the real property9 or for 
purchase price and/or transaction details10. 

During the long history of registering real property information, which dates back to the 19th 
century, two prevalent systems of registration have emerged – a deed recording system and a 
title registration system. A deed is a record of a particular transaction. It serves as evidence of 
a specific agreement (such as the sale of real estate), but it is not itself a proof of the legal 
right  of  the  transacting  parties  to  enter  into  and  consummate  the  agreement11.  Under  the 
alternative  system,  where  the  titles  are  registered,  the  title  registration  is  a  proof  of 

Interconnection 

4  European  Commission,  Directorate-General  for  Financial  Stability,  Financial  Services  and  Capital  Markets 
Union,  Study  on  the  harmonisation  and  interconnection  of  real  estate  registers  :  final  report,  Publications 
Office, 2021, https://data.europa.eu/doi/10.2874/068191; hereinafter ‘European Commission (2021)’. 
5 European Commission, Directorate-General for Justice, Schmitz, P., Athanasiou, P., Torrinha, P., et al.  Land 
Registers 
2015, 
feasibility  and 
https://data.europa.eu/doi/10.2838; hereinafter ‘European Commission (2015)’. 
6 Land register is understood as a public register of deeds or rights concerning real property. 
7  Cadastre  is  a  systematic  description  of  the  land  units  within  an  area.  The  description  is  made  by  maps  that 
identify the location and boundaries of every unit, and by records. In the records, the most essential information 
is the identification number and the area of the unit, usually differentiated by land use class. 
8 Cyprus, Denmark, Hungary, Lithuania, Romania, Slovakia, Slovenia and Estonia. 
9 Portugal and France. 
10 Germany and Finland. 
11 European Commission (2015), p. 273. 

implementation  analysis,  Publications  Office, 

2 

 
 
 
 
 
 
 
                                                 
ownership. Currently, 23 Member State have a title system or both systems, while 4 have a 
deed system only12. In some Member States, there has been a gradual move from the deeds 
system to the title system, but there have been no changes in the opposite direction13. 

For many Member States, the different kinds of registers described above are centralised at 
the national level – that is, they cover the whole area of a country. However, this is not the 
case for France14. Germany and Italy15. Spain has a mixed system: although it has more than 
1  000  land  registers  with  exclusive  competences  and  databases,  it  also  provides  a  national 
interconnected  platform16.  Greece  has  a  similar  system,  with  the  land  register  database 
managed  centrally  for  the  whole  country  by  a  company  and  updated  by  the  local  land 
registrers based on their transactions17. 

Most  Member  States  have  digitalised  registers,  accessible  online.  Yet  exceptions  exist.  In 
France,  the  data  held  by  local  registers,  although  digitised,  are  not  accessible  online,  and 
results of queries are provided manually, in an asynchronous way (apart from the Alsace and 
Moselle regions)18. The Luxembourg register is also off-line19.  

2.2.  The role and purpose of real estate registers in the Single Market  

The primary purpose of data in real estate registers is legal certainty as to property rights and 
rights  of  third  parties  with  regard  to  a  given  real  estate  unit.  Besides  public  authorities, 
citizens  and  professionals  use  data  stored  in  real  estate  registers,  most  often  based  on  a 
legitimate  interest  related  to  a  potential  exchange  of  ownership  or  a  claim  as  a  third  party.  
Real  estate  registers  may  be  used  domestically  also  used  in  a  cross-border  situations,  thus 
having a Single Market dimension are. The following list presents a non-exhaustive overview 
of circumstances in which real estate registers may be used cross-border:  

-  One typical use of real  estate registers is in the context of purchase of  real estate in 
another Member State. Citizens and professionals may wish to check the legal status 
and  burdens  of  a  property  located  abroad  or  the  accurate  registration  of  owned 
property20. 

12  Ibid,  p.  145-146,  not  including  UK.  The  Member  States  with  a  title  system  or  both  systems  are  Austria, 
Bulgaria,  Cyprus,  Czechia.  Germany,  Denmark,  Estonia,  Greece,  Spain,  Finland,  France,  Croatia,  Hungary, 
Ireland, Italy, Lithuania, Latvia, Malta, Poland, Portugal, Sweden, Slovenia and Slovakia. Member States with a 
deed  system  only  are  Belgium,  Luxembourg,  the  Netherlands  and  Romania.  In  France,  Alsace  and  Moselle 
regions  follow  the  title-recording  model  (as  opposed  to  the  rest  of  the  country).  The  same  is  true  for  the 
autonomous province of Trento in Italy.  
13 European Parliament – Study for the JURI Committee, Cross Border Acquisitions of Residential Property in 
the EU: Problems Encountered by Citizens, 2016, p. 58-59. 
14 France has 120 local property registers, which are not interconnected. 
15 In Italy, some regions maintain separate registers, but most of the country is covered by one register. 
16  Touriñán  T,  “The  Spanish  Land  Registration  system  and  the  IMOLA  project”,  in:  IMOLA  II  Project  (The 
European Land Register Document (ELRD): A common Semantic Model for Land Registers Interconnection), p. 
248, 252. 
17 https://e-justice.europa.eu/content_land_registers_in_member_states-109-el-en.do?member=1 
18 European Commission (2015), p. 242-243. 
19 Ibid, p. 216. 
20  Moerkerke  J.,  “IMOLA  II,  the  ELRA’s  commitment  with  European  citizens:  opening  a  collaboration 
framework with EU authorities”, in: IMOLA II Project (…), p. 29. 

3 

 
 
 
 
 
 
                                                 
-  Real estate registers can be consulted in the context of judicial proceedings connected 

to immovables21, including execution of judicial decisions. 

-  Real  estate  registers  can  also  be  consulted  for  the  purpose  of  information  exchange 
between  tax  authorities.  Under  Directive  2011/16/EU22  information  on  income  and 
ownership of immovable property is automatically exchanged on a cross-border basis 
between the tax authorities of the Member State in which the property is located and 
the tax authorities of the Member State in which the property owner is resident. 

-  Real  estate  registers  can  be  used  to  obtain  information  on  burdens.  This  can  be  the 
case, for example, of consultations by financial institutions in the context of granting 
loans and mortgages. 

-  Authorities can consult real estate registers in the context of proceedings concerning 
tax  liabilities,  including  recovery  of  taxes,  duties  and  other  measures  governed  by 
Directive 2010/24/EU23. 

-  Consultation  of  real  estate  registers  can  also  take  place  in  the  context  of  succession 
cases.  In  particular,  Regulation  (EU)  No  650/201224  requires  the  authority  issuing  a 
European  certificate  of  succession  to  verify  the  information  concerning  property 
owned by the deceased. 
In the context of bankruptcy proceedings, searches of the real estate registers can be 
performed by an authority but also by creditors. 

- 

2.3. 

Interconnection initiatives  

To date, there have been some EU-level initiatives concerning the interconnection of national 
land registers. 

The  Land  Registers  Interconnection  (LRI)  is  an  ongoing  project  funded  by  the  European 
Union’s Justice Programme25, which Members States can join on a voluntary basis26. It aims 
to provide a single access point through the European e-Justice Portal27 to the land registers 
of  participating  Member  States.  The  first  phase  of  the  project  resulted  in  the  creation  of  a 
technically  operable  interconnection  of  the  land  registers  of  Austria  and  Estonia.  The 
prospective  service  is  publicly  available  as  a  demo28.  The  second  LRI  Member  State 
interconnection  project,  supported  by  EU  funding,  started  in  March  2020  and  ended  in 

21 M. Cuccaro, “The ELRD as a source of information for courts in Cross-border matters”, in: IMOLA II Project 
(…), p. 221. In particular: “(…)  from a purely practical point of view it can be extremely useful to know with 
certainty whether the plaintiff has correctly publicized the existence of the legal proceedings in the competent 
Land  Registry,  which  may  be  located  in  a  different  Member  State  that  the  one  where  the  judge  having 
jurisdiction is deciding over the transnational dispute.” 
22  Council Directive 2011/16/EU of 15 February 2011 on administrative cooperation in the  field of taxation 

and repealing Directive 77/799/EEC 

23  Council  Directive  2010/24/EU  of  16  March  2010  concerning  mutual  assistance  for  the  recovery  of  claims 
relating  to  taxes,  duties  and  other  measures  OJ  L  84,  31.3.2010,  p.  1–12  and  European  Commission  (2021), 
p. 29. 
24 Regulation (EU) No 650/2012 of the European Parliament and of the Council of 4 July 2012 on jurisdiction, 
applicable  law,  recognition  and  enforcement  of  decisions  and  acceptance  and  enforcement  of  authentic 
instruments  in  matters  of  succession  and  on  the  creation  of  a  European  Certificate  of  Succession,  OJ  L  201, 
27.7.2012, Article 66(5). 
25 
the Justice Programme and repealing Regulation (EU) No 1382/2013 (OJ L 156, 5.5.2021, p. 21–38). 
26 For more information see https://lri-ms.eu/ 
27  https://e-justice.europa.eu/ 
28 https://lri-ms.eu/outcomes  

Regulation (EU) 2021/693 of the European Parliament and of the Council of 28 April 2021 establishing 

4 

 
 
 
 
                                                 
October  2021.  Within  the  project,  Latvia  connected  its  land  register  to  the  LRI  service 
platform.  Hungary,  Portugal  and  Spain  undertook  a  thorough  analysis  for  gaining  full 
understanding of the country-specific conditions to be met before launching the development 
of the national LRI connection.  

In  its  2020  Communication  “Digitalisation  of  justice  in  the  European  Union.  A  toolbox  of 
opportunities”, the Commission stated that to exploit the full potential of the LRI, it should 
extend EU-wide, with the objective to ensure full participation of Member States by 2024.29 

IMOLA  (Interoperability  MOdel  for  LAnd  registers)  is  a  project  of  the  European  Land 
Registry Association, co-funded by the European Union’s Justice Programme30. The project 
aims  to  produce  a  common  template  for  EU-level  organisation  of  information  contained  in 
real  estate  registers,  connected  to  explanatory  material  in  different  languages.  The  main 
achievement of IMOLA is the creation of a “European Land Register Document” concept – a 
template for organising land register information at EU level including a semantic model31. 

3.  REAL  ESTATE  AND  REAL  ESTATE  REGISTERS  IN  THE  MONEY  LAUNDERING  AND 

TERRORIST FINANCING CONTEXT 

This  chapter  looks  into  the  ways  in  which  the  real  estate  registers  can  be  used  in  the 
AML/CFT context. 

3.1.  Risk  factors  and  common  misuses  of  the  real  estate  sector  for  money 

laundering and terrorist financing purposes  

According  to  the  Financial  Action  Task  Force  (FATF),  the  purchase  of  real  estate  is  a 
common outlet for criminal proceeds, with real estate properties representing around 30% of 
the criminal assets confiscated worldwide between 2011 and 201332. Whilst it is difficult to 
obtain data on the magnitude of ML/TF in the sector, the European Union Law Enforcement 
Agency (Europol) predicts that in the medium term, as a result of the COVID-19 pandemic, 
the  real  estate  and  construction  sectors  will  become  even  more  attractive  for  money 
laundering.33 The European Commission’s 2019 assessment of the risk of money laundering 
and  terrorist  financing  affecting  the  Single  Market  and  relating  to  cross-border  activities34 
(the  “supranational  risk  assessment”)  assessed  the  level  of  vulnerability  of  the  real  estate 
sector  to  terrorist  financing  as  significant  and  to  money  laundering  as  significant/very 
significant35. 

Real estate plays a role mainly in the final stage of the money laundering cycle, namely in the 
integration phase36. It allows the integration of illicit funds into the legal economy, to return 

29 COM(2020)710 final, pp 13-14. 
30 https://www.elra.eu/imola/ 
31 Ibid. 
32 FATF, Money Laundering and Terrorist Financing Vulnerabilities of Legal Professionals, 2013, p. 24.  
33 Europol, Beyond the Pandemic: How COVID-19 Will Shape the Serious and Organised Crime Landscape in 
the EU, 2020, p. 12.  
34 SWD(2019)650 final. 
35 Ibid, p. 171. 
36 European Commission (2021), p. 37.  

5 

 
 
 
 
 
 
 
 
                                                 
the  proceeds  to  criminals,  and  even  to  generate  legitimate  income37.  Real  estate  is  also 
generally  an  appreciating  asset,  which,  if  sold,  can  provide  a  legitimate  reason  for  the 
appearance of funds38. 

Common methods used by criminals often involve complex schemes to acquire real estate – 
from the use of complex loans or credit finance, intermediation via professionals, the use of 
corporate  vehicles,  manipulation  of  the  appraisal  or  valuation  of  a  property,  the  use  of 
monetary  instruments  such  as  cash  or  cheques,  the  use  of  mortgage  schemes  or  the  use  of 
properties to conceal money generated by illegal activities39. 

3.2.  The use of real estate registers in the AML/CFT context  

Information  contained  in  real  estate  registers  can  help  competent  authorities  and  FIUs  in  a 
number  of  ways.  The  study  completed  in  support  of  this  report,  which  included  targeted 
consultations  of  AML/CFT  authorities,  confirms  that,  overall,  they  are  satisfied  with  the 
speed  of  cross-border  information  exchange  on  real  estate  between  FIUs  and  competent 
authorities,  as  well  as  with  the  information  contained  in  the  real  estate  registers,  as  it 
generally  allows  identification  of  proprietorship  and  information  on  the  real  estate.40 
However, while advantages could be achieved through the harmonisation of the information 
contained  in  real  estate  registers  and  the  access  of  FIUs  and  competent  authorities  to  real 
estate  registers  of  other  Member  States,  it  is  important  to  note  that  not  all  information 
relevant for FIUs and competent authorities can be retrieved through such registers. 

The  use  of  complex  schemes  involving  “shell  companies”,  complex  ownership  structures 
including trusts or companies established in low-transparency jurisdictions, or nominees is a 
common ML/TF typology in the real estate sector. According to the 2019 supranational risk 
assessment,  private  sector  representatives  consider  it  a  major  challenge  to  identify  the 
beneficial  ownership  of  a  property,  in  particular  when  the  seller  and  buyer  transact  using 
trusts. A survey among FIUs showed that 61% of the respondents saw real estate transactions 
done only by third parties and intermediaries as a common operative scheme used for ML/TF 
involving the real estate sector. This was followed by 44% of respondents who chose use of 
corporate  vehicles,  trusts  or  nominees,  and  39%  who  indicated  that  the  difficulty  in 
establishing  the  real  identity  of  the  owner,  renter  or  investor  in  real  estate  is  a  major 
problem41. 

Real  estate  registers  can  be  used,  together  with  other  interconnected  registries  available  to 
FIUs  and  competent  authorities,  e.g.  beneficial  ownership  registers,  to  detect  ML/TF  cases 
where the techniques described above are used, as they can provide reliable, complementary 
and  up-to-date  information  on  present,  and  in  some  cases,  past  owners  of  a  real  estate 
property.  In  a  survey  among  competent  authorities  and  obliged  entities,  over  80%  of 
respondents said information on past and present proprietorship is useful in their work42. At 

37  European  Parliamentary  Research  Service,  Understanding  Money  Laundering  through  Real  Estate 
Transactions, 2019, p. 2 and European Commission (2021), Ibid.  
38 FATF, Money Laundering and Terrorist Financing Vulnerabilities of Legal Professionals, 2013, p. 44.  
39 FAFT/OECD, Money laundering and terrorist financing through the real estate sector, 2007. 
40 
exchange of information). 
41 European Commission (2021), p. 50. Choosing more than one answer was possible. 
42 Ibid, p. 90. 

European  Commission  (2021),  p.  87,  91  (content  of  real  estate  registers),  and  101-102  (cross-border 

6 

 
 
 
 
 
 
                                                 
the  same  time,  some  of  them  reported  that  information  on  ownership  rights  is  sometimes 
missing,  and  lack  of  additional  personal  information,  such  as  a  personal  identification 
number, prevents the identification of the beneficial owner43. 

Typologies of ML/TF through the real estate sector also include unusually priced properties: 
either above or below the market value of the property44. A common element is also the lack 
of coherence between the declared income/wealth of the buyer and the value of the real estate 
property45. Against this background, 63% of respondents indicated that price of the property 
is  an  important  piece  of  information.  Respondents  have  also  said  that  purchase  price  or 
valuation of the property is missing from the register46. The most recent data on the inclusion 
of such information is from 2014. Then, data on purchase price was stored in the real estate 
registers of 14 Member States47 and for further six Member States it was stored but was either 
not registered in any register or registered separately from the real estate register48. Linked to 
this  is  the  absence  of  historical  records  on  the  transfer  of  real  estate  ownership,  means  of 
payments  (particularly  given  the  rising  trend  in  purchase  of  real  estate  using  cash)  and 
purchase contracts. 

Respondents  have  also  indicated  concerns  with  regard  to  the  accuracy  of  the  information 
contained in the registers (e.g. the description of the property is not/no longer accurate) and 
its completeness (condominiums, despite being widespread in the market, are not included in 
all registers).  

The next section analyses the pros and cons of interconnecting real estate registers. It does so 
from the strict perspective of the AML/CFT framework and the use made of these registers 
for the purposes of preventing and combating cross-border money laundering and terrorism 
financing that involve the real estate sector. 

4.  HARMONISATION OF THE INFORMATION INCLUDED IN THE REAL ESTATE REGISTERS  

For the purposes  of this report, harmonisation  of the information  in  the real  estate registers 
means creating a minimum dataset regarding real estate property that would be provided by 
all Member States.  

Harmonisation  of  the  information  currently  available  in  the  registers  would  probably  not 
suffice to address the needs of AML/CFT authorities. Information typically needed by FIUs 
and competent authorities, such as seller/buyer identification data, property price, date of sale 
or ownership change (including a record of ownership transfers), is generally not available in 
the  registers.  Thus,  any  potential  harmonisation  should  be  accompanied  by  additional  data 
collected and stored in the registers to be of added value for AML/CFT purposes. 

43 Ibid.  
44  OECD,  Money  Laundering  and  Terrorist  Financing  Awareness  Handbook  for  Tax  Examiners  and  Tax 
Auditors, 2019, p. 48; FATF, Risk-Based Approach Guidance for Real Estate Agents, 2008, p. 22 and European 
Commission (2021), p. 38. 
45 European Commission (2021), p. 51. 
46 Ibid, p. 91 
47  Austria,  Belgium,  Bulgaria,  Cyprus,  Denmark,  Estonia,  Greece,  Spain,  Lithuania,  Luxembourg,  Latvia, 
Netherlands, Romania and Sweden and European Commission (2015), p. 171-175. 
48 Ireland, Germany, Finland, Portugal, Czechia, Slovakia, Ibid.  

7 

 
 
 
 
 
 
 
 
                                                 
At  the  same  time,  access  to  such  information  should  be  carefully  designed,  as  making  it 
available for other purposes might not always be proportionate. 

4.1.  Benefits 

Harmonisation of the information contained in the real estate registers can have a number of 
benefits, which go beyond the prevention and combating of money laundering, its predicate 
offences, and terrorist financing. Harmonisation can be a trigger to complete the digitalisation 
of the national real estate registers and enhance accessibility, making them fit for the digital 
age.  In  addition,  harmonisation  can  be  conducive  to  legal  certainty,  as  a  common  structure 
with clarity on terminology and legal value of information stored can itself contribute to more 
transparent  and  reliable  information.  Harmonisation  of  the  data  contained  in  the  real  estate 
registers  would  also  enable  faster  access  to  and  use  of  the  information.  Finally,  the 
availability  of  harmonised  information  in  the  real  estate  registers  would  facilitate 
identification of property ownership, whether nationally or in other Member States. It would 
therefore contribute to financial intelligence, financial investigations but also in the freezing 
and confiscation of assets. 

4.2.  Drawbacks and constraints 

Real  estate  registers  have  developed  into  their  current  shape  within  the  context  of  specific 
national systems of property organisation.  

Article 345 is an expression of the principle of the neutrality of the Treaties in relation to the 
rules in Member States governing the system of property ownership. However, that does not 
mean that those rules are not subject to the fundamental rules of the European Union, which 
rules include, inter alia, the prohibition of discrimination, freedom of establishment and the 
free movement of capital.49 In other words, Article 345 TFEU would not stand in the way of 
harmonisation  of  such  issues  as  collection,  storage  and  presentation  of  a  set  of  commonly 
defined data, as long as it respects the fundamental principles of Union law and in particular 
the  Union’s  neutrality  in  relation  to  the  rules  in  Member  States  governing  the  system  of 
property ownership.  

Due  to  the  legal,  political,  organisational  and  historical  difference  between  registers  across 
the  EU,  harmonisation  of  real  estate  registers  would  require  significant  efforts  by  Member 
States,  since  it  might  trigger  significant  redistribution  of  tasks,  revision  of  national  legal 
frameworks and review of and changes in the set-up and functioning of the registers.  

The  sole  harmonisation  of  the  information  already  contained  in  the  registers  would  imply 
administrative  and  financial  costs.  As  noted  under  point  4.2,  harmonisation  of  data  would 
require  changes  to  legislation,  a  review  of  the  registers’  functioning  and  possibly  a 
redistribution of competences at the national and sub-national level. An attempt at estimating 
such  costs  places  them  at  a  reasonable  level  when  only  the  registers  are  concerned  (with 
staffing  needs  calculated  at  3  full-time  equivalent  and  a  one-off  cost  of  EUR  50  000  per 

49 

Judgment of the European Court of Justice in Joined Cases C-105/12 to C-107/12, Essent NV and others, 
points  29  to  36;  Opinion  of  the  European  Court  of  Justice  in  Opinion  procedure  2/15  (Singapore),  point 
107. 

8 

 
 
 
 
 
 
 
 
                                                 
Member State, with limited recurring costs50), but this does not take into account costs that 
are more difficult to estimate such as changes to legislation and reallocation of competences. 
More reliable estimates could only be drawn up on the basis of precise harmonisation models. 

4.3.  Conclusions  

While  the  estimated  costs  of  harmonising  real  estate  registers  are  small,  they  can  only  be 
regarded as partial and therefore do not provide an accurate picture of the implications from 
such  a  harmonisation.  More  importantly,  from  an  AML/CFT  perspective,  the  only  possible 
harmonisation  that  could  be  achieved  is  that  of  information  pertinent  to  the  prevention  and 
combat  of  ML/TF.  However,  as  noted  above,  most  of  the  information  necessary  for 
AML/CFT  authorities  is  not  contained  in  the  real  estate  registers.  Coversely,  most  of  the 
information contained in the real estate registers,  which is not relevant to AML/CFT, could 
not be harmonised for AML/CFT purposes.  

5. 

INTERCONNECTION OF NATIONAL REAL ESTATE REGISTERS  

Interconnection of real estate registers could come in a number of forms. It could follow the 
example  of  the  beneficial  ownership  registers  interconnected  under  the  AMLD  through  a 
common interface in the e-justice portal. Alternatively, it could be a central system drawing 
information from the national real estate registers and presenting it in a harmonised manner. 

5.1.  Benefits 

The interconnection of national real estate registers at EU level would facilitate cross-border 
access to information contained in the national registers of all Member States. It would not 
only support more effective implementation of EU rules in civil and criminal justice matters 
and  improving  access  to  justice,  but  could  also  serve  more  broadly  as  a  catalyst  for  the 
internal market by facilitating cross-border transactions.  

In the AML/CFT field, interconnection could provide authorities with a more comprehensive 
picture of the assets owned by natural or legal persons, or legal arrangements. Access to EU-
wide real estate data might assist in the detection of cross-border elements when performing 
strategic and operational analyses, as well as in the context of financial investigations. Such 
an  interconnection  would  also  support  faster  and  more  effective  asset  freezing  and 
confiscation measures. Beyond the AML/CFT framework, authorities working on succession 
cases might benefit from a smoother cross-border access to data, given the estimate that one 
in  ten  succession  cases  in  the  EU  has  a  cross-border  dimension51.  Finally,  interconnection 
could serve as a catalyst to modernise the registers, including their full digitisation.  

5.2.  Drawbacks and constraints 

A number of factors need to be taken into account. First, any interconnection would have to 
confront  of  the  uncertainty  surrounding  the  information  contained  in  the  register,  which  is 
closely linked to the national system in which the real estate register has developed, including 
in  relation  to  the  verification  of  the  information  recorded.  Unless  accompanied  by 

50 European Commission (2021), p. 99. 
51 SEC(2009) 410 final, p. 18. 

9 

 
 
 
 
 
 
 
 
 
 
                                                 
harmonisation,  any  interconnection  might  risk  conveying  a  false  impression  as  to  the 
comparability of the information contained in the registers. Linked to the issue of information 
comparability is  information exhaustiveness.  While not  all relevant  information  is  stored in 
the real estate registers, interconnected registers might give the false impression of containing 
all  information  that  competent  authorities  need,  whereas  this  information  might  be  stored 
elsewhere.  A  further  challenge  concerns  risks  that  the  mere  interconnection  of  the  registers 
would  not  provide  sufficient  clarity  unless  terminology  is  correctly  translated  in  the  other 
languages, duly reflecting legal specificities.  

Indicatively,  harmonising  the  information  contained  in  the  real  estate  registers  and 
interconnecting  those  registers  would  imply  between  EUR  95  000  and  320  000  in  one-off 
costs  and  between  EUR  50  000  and  175  000  in  recurring  yearly  costs  for  Member  States, 
depending on the level  of changes to  be made to the existing registers52.  In addition,  about 
EUR 100 000 in yearly costs would have to be borne at EU level for the management of the 
interconnection. As noted under point 4.3, these estimates do not take into account the cost of 
changes to legislation and reallocation of competences. More reliable estimates could only be 
drawn up on the basis of precise interconnection models. 

5.3.  Conclusions 

The above analysis shows that the interconnection of the existing real estate registers without 
at  least  some  level  of  harmonisation  of  the  information  contained  therein  would  present  a 
number of weaknesses that might offset its benefits. From a cost perspective, interconnection 
alone would not require significantly lower resources than when accompanied by a degree of 
harmonisation of the information contained in the registers53.  

6.  ASSESSMENT OF PROPORTIONALITY AND NECESSITY  

This report aims to provide input as regards the relevance of harmonising or interconnecting 
real  estate  registers  from  an  exclusive  AML/CFT  angle.  It  does  not  aim  to  replace  nor 
prejudge any assessment of proportionality and necessity of other possible initiatives by the 
Commission concerning real estate registers in a wider sense. 

The  analysis  provided  above  shows  that  interconnection  of  real  estate  registers,  if 
accompanied by the necessary level of harmonisation, could provide benefits from allowing 
citizens  and  businesses  to  exercise  their  freedoms  and  support  effective  access  to  justice  in 
cross-border  situations.  For  these  reasons  the  Commission  has  envisaged  that,  by  2024,  all 
Member States should participate in the interconnection of land registers54.  

From  a  purely  AML/CFT  angle,  feedback  provided  by  FIUs  and  competent  authorities 
indicates  that  the  overall  speed  of  the  cross-border  exchange  of  real  estate  information  is 
satisfactory. However, much of the information that AML/CFT authorities need is currently 
not  stored  in  the  real  estate  registers.  Thus,  notwithstanding  the  high  ML/TF  risks  that  this 

52 18 Member States would be expected to incur costs in the lower ranges, whereas seven Member States would 
be expected to face costs in the higher range and two Member States would face costs in the medium range, see 
European Commission (2021), p. 97. 
53 Ibid, p. 99-100. 
54 COM(2020)710 final, pp. 13-14. See above, section 2.3. 

10 

 
 
 
 
 
 
 
 
                                                 
sector faces, there is no compelling necessity from an AML/CFT viewpoint that would justify 
interconnecting real estate registers for AML/CFT purposes.  

To  support  action  by  AML/CFT  authorities,  the  Commission  proposal  for  a  6th  AML 
Directive  expands  the  scope  of  information  regarding  real  estate  transactions  that  those 
authorities  can  access55.  In  parallel,  in  order  to  prevent  the  misuse  of  complex  ownership 
structures or cash to launder money through the real estate sector, the proposal for an AML 
Regulation expands beneficial ownership transparency requirements to foreign legal entities 
that purchase real estate in the Union56 and sets an upper limit of 10 000 EUR for payments 
in cash57. 

7.  CONCLUSIONS  

This report sets out a number of elements to be considered for a possible interconnection of 
real  estate  registers  and  the  harmonisation  of  the  information  they  contain  for  AML/CFT 
purposes only. It does not aim to replace nor prejudge any assessment of proportionality and 
necessity of other possible initiatives by the Commission concerning real estate registers in a 
wider sense.   

It  acknowledges  the  ML/TF  risks  to  which  the  real  estate  sector  is  exposed  and  shows  the 
benefits that interconnection and harmonisation of such registers could  do in this context as 
well as to citizens and to the Single Market as a whole.  

At the same time, the analysis in this report shows the complex and diverse landscape of real 
estate registers in the Member States, which is heavily influenced by historical factors and the 
different national property law regimes. 

Therefore any possible legislative proposal concerning the interconnection and harmonisation 
of real estate registers should not be regarded only, nor primarily, from an AML/CFT angle. 
Real  estate  registers  are  not  a  purely  AML/CFT  instrument.  Their  core  functions  and  the 
reasons behind their creation lie in the need to register a property right, planning or taxation 
purposes.  Real  estate  registers  primarily  serve  authorities  other  than  those  tasked  with 
preventing and combating ML/TF. In addition, the AML/CFT framework focuses on granting 
access to competent authorities and FIUs to the information they need to prevent and combat 
ML/TF. As such, it could not offer the basis for a harmonisation of the information contained 
in the real estate registers, which has no AML/CFT relevance.  

The  analysis  showed  that,  from  an  AML/CFT  perspective,  the  quality  of  cross-border 
information  exchange  on  real  property  ownership  is  satisfactory  overall,  and  that  not  all 
information needed for AML/CFT purposes can be retrieved from real estate registers. This 
indicates that there is  no overriding need to interconnect  real  estate registers for AML/CFT 
purposes.  

55 COM(2021)423 final, Article 16. 
56 COM(2021)420 final, Article 48. 
57 Ibid, Article 59. 

11