 Welcome to this, the last panel of this year ESCB conference. By now I have the feeling the other panelists have set the bar very high, but I think we are not going to disappoint you in this panel. I'm Carmen Hernández, I am head of section at the Legal Department of the ECB, and I'm delighted to introduce you to the topic of this panel, which is the National Competent Authority's duty of assistance and the ECB's duty of diligence when in performing its supervisory tasks has to assess antinominal rendering, to which I will refer as AML, and counter-terrorism financing, to which I will refer as CTF. So under the SSM regulation, the ECB is exclusively competent to perform a specific task in prudential supervision. At the same time, AML and CTF-related supervisory tasks have not been conferred to the ECB and remain with competent authorities at national level. Notwithstanding this, significant points of contact exist between AML and CTF supervision and the ECB's supervisory tasks. For example, AML-CTF-related findings can be relevant to assess the suitability of a broad member in fit and proper precedence or a proposed acquirer of a qualifying holding in a bank. The ECB is also exclusively competent to withdraw the authorization of credit institutions for serious breaches of AML-CFT rules. Competent authorities, including the ECB of course, so discharge the responsibilities in full respect of the distribution of tasks decided by the legislator. And at the same time, appropriate integration of AML-CFT issues into prudential supervision should be ensured. The effectiveness of the system relies in two principles. The NCAA's duty to assist the ECB and the duty of diligence which bounds the ECB when exercising its tasks. Applying this in practice may involve certain difficulties on the legal side. This has come to light in several occasions during the last years. Some disputes have reached the court of justice of the European Union also. The VersaBank and the APB cases concern actions for annulment against ECB decisions to withdraw the authorization of credit institutions for, among other things, breaches of AML provisions. In these cases, the general court has made important considerations that help to clarify the delineation of competences between the ECB and the national competent authorities. Today, in this panel, we will have the opportunity to discuss about these issues with three knowledgeable and experienced lawyers that will offer diverse perspectives on the matter. I have had the pleasure to work with them in numerous occasions and I hold each of them in high esteem, not only professionally but also personally. I am thrilled to share this virtual table with all of them today. Let me introduce each of them in order of their appearance before we start the discussion. So on the first place, we have Odrone Estabilite, who joined us from Brussels. She has been a member of the Legal Service of the European Commission since 2002 and since 2013, she was directly involved in the creation and development of the Banking Union and her field of expertise covered bank supervision, bank resolution, capital requirements, European supervisory authorities, as well as sustainable finance. Odrone has represented the European Commission in more than 350 court cases before the cart of justice of the European Union and she has published in the field of Union law with a specific emphasis on banking law, free movement of capital, as well as union cohesion policy and structural instruments. Today, Odrone will walk us through the general framework on the distribution of competencies between the ECB and the national competent authorities paying special attention to the views of the court of justice on this field. Odrone will also touch upon the recent legislative developments in the field of AML CRT. Then we will listen to Georgia Marafioti, who is here in Frankfurt besides me. She is senior legal counsel in the supervisory law division of the ECB's legal department. And since 2017, she has been providing legal advice to the ECB's banking supervision arm and representing the ECB before the court of justice of the European Union in several cases related to banking supervision. Prior to joining the ECB, Georgia worked for the banking supervision department of Banka d'Italia and previously for a prestigious international law firm focusing on corporate and banking law issues and international arbitration. Today, Georgia will provide interesting reflections on the role of the ECB when it comes to integrate AML CFT issues into provincial supervision. Last but not least, we will listen to Rafael Martínez Lothano, who joined us today from Madrid. He is a senior lawyer in the regulatory and supervisory advice division at Banco de España legal department. He advises on legal issues relating to supervision and resolution of credit institutions, including the drafting of related legislation. He also worked for the supervisory law division of the ECB's directorate general legal service between 2017 and 2019, providing legal advice on topics related to the SSM framework. Prior to joining Banco de España's legal department, Rafael worked for a leading law firm in Spain, where his practice was focused on public law and regulated sectors. Rafael will present to us the particular point of view of an NCA that it's not the national AML CFT authority, which adds another level of complexity to the system I just described. Odrone, Georgia, Rafa, thank you very much for having accepted the ECB invitation for being here today and participate in this discussion. Before we start, I would like just to remind the audience about a few housekeeping rules. The panelists will deliver their presentations on a row, and then we will open the floor for questions and discussion. You are invited to submit your questions by raising the hand button that you can find in Webex. At that moment, you will be invited to ask your question, and it's then when you will be able to unmute yourself and switch on your camera and then ask your question. And with this, I am delighted to give the floor without further ado to Odrone. Thank you, Carmen. Good afternoon. In my presentation, I will essentially speak about the three following aspects. First, I will briefly cover exclusive ECB powers in a decentralized cooperation framework. Second, relying on the recent case law, I will speak about the NCA's supportive function in dealing with AML CFT breaches in authorization withdrawal process. Thirdly, I will briefly present main AML CFT legislative developments in CRD. And finally, I will draw some conclusions. Next slide, please. The assembly regulation provides that when the ECB exercises its exclusive competences as prudential supervisor, ensuring compliance with the relevant union law, the ECB is assisted by the national competent authorities. The general court confirmed in its Verso Bank judgment that the powers which were not conferred on the ECB remain vested in the NCA's. So the SSM centralizes functions related to prudential supervision with the ECB and provides at the same time for a decentralized implementation by the NCA's, yet always under the supervision of the ECB to which the NCA's provide their cooperation and assistance. While the ECB exercises direct prudential supervision of significant credit institutions, the prudential supervision of less significant institutions is part of the all-grade dimension decentralized exercise of powers by the NCA's. So in a nutshell, contextually, rather than having a distribution of powers between the ECB and the NCA's in the performance of tasks referred to in article four paragraph one of the SSM regulation, the SSM regulation establishes that exclusive powers delegated to the ECB are implemented in a centralized framework. Second slide, please. More specifically, in the area of the AML CFT, from the creation of the single supervisor mechanism, one could observe a possible tension of competence that belongs to the national authorities on one hand and the ECB on the other hand. That aspect has already been by now addressed in the case law to which I will soon refer. But first of all, on one hand, recitals 28 and 29 of the SSM regulation lists among the supervisory tasks not conferred on the ECB and which should remain with the national authorities, the prevention of the use of the financial system for the purpose of money laundering and terrorist financing. On the other hand, it follows from the combined reading of articles four paragraph one and six of the SSM regulation that the power to withdraw authorizations from credit institutions is reserved exclusively to the ECB. So the assisting role of the national competence authorities is particularly important in the withdrawal of authorizations due to the AML CFT concerns. As can be seen from article 67 of CRD, the withdrawal of an authorization is also provided for where a credit institution fails to comply with the AML CFT requirements. Therefore, compliance with AML CFT requirements and obligations is somewhat part of the prudential supervision since the use of the financial system for money laundering purposes is likely to threaten the stability, integrity and reputation of the financial system and therefore of the single market. But may the ECB adopt a decision withdrawing a banking authorization because of the infringement of AML CFT provisions alone, would the ECB have sufficient competence for that and the answer is absolutely yes. Article 18.f of the CRD provides that banking authorizations may be withdrawn if the credit institution commits at least one of the breaches foreseen in article 67 paragraph one of the CRD. For example, when the authority identifies a serious breach of the national provisions adopted pursuant to the AML CFT directive. In exercising its competence related to the withdrawal of authorizations, the ECB is therefore obliged to apply in Teralia the national law provisions transposing the CRD. In the Versauban judgment, the general court rejected arguments that owning to the division of powers between the NCA and the ECB together with the principle of proportionality the full range of other milder measures for instance fines or prohibition to carry out certain activities must be first exhausted before an authorization can be withdrawn on grounds of AML CFT infringement. In another famous very recent judgment the AEB judgment rendered in June this year the general court made another important declaration. It was recognized as sufficient if national authority adopts an administrative decision establishing a serious breach of AML CFT law and there is no requirement that a judgment or decision having resjudicata effects recognizes credit institution's responsibility for the AML CFT breach. The AEB judgment also clarified that from the moment the national administrative decision becomes final meaning it is not possible to challenge that decision in the national court any longer the question of prescription related to the facts established in that decision cannot be raised anymore and hence the ECB is fully legally entitled to rely on the factual aspects about in such a final administrative decision. In other words the fact that the AML CFT breaches are old or have been corrected has no bearing on the occurrence of the credit institution's liability. Moreover the seriousness of those breaches established in the final national administrative decision may no longer be challenged in the administrative procedure applied by the ECB. One of the most important policy related aspects established in the AEB judgment is linked to the general objective of safeguarding the European banking system. The general court takes a firm stance concerning corrected AML CFT breaches and states that if such corrected breaches could no longer justify a withdrawal of authorization credit institutions that have committed serious breaches would be permitted to continue their activities as long as the competent authorities do not demonstrate again that they have committed new breaches and that would not be acceptable. The division of powers between the ACAs and the ECB under the SSM in practice requires that the facts constituting breaches of the AML CFT legislation are established by the national authorities often specialized in the area. Whereas the legal assessment of whether those facts justified withdrawal of authorization and the assessment of proportionality are reserved for the ECB. The ECB therefore has to rely on its own assessment of compliance with the national provision in that regard. It should be noted that having a union institution such as the ECB to rely on the findings made by another institution situated at a different level or even in a different legal order is not a normal situation. This is why when the ECB considers to undertake its own assessment of the facts and the legal grounds of the case in order to exercise its discretion this assessment is to be distinguished from the investigation or determination of relevant facts. The ECB is not obliged in the case of less significant credit institutions to carry out its own investigation but may validly rely on factual findings provided to it by the national authorities. Since the adoption of the system regulation and Seer D4 in 2013 the General Court provided important insight on the underlying principles of cooperation between NCA's and the ECB when assessing AML CFT as best relevant for the ECB supervisory task. Further developments in jurisprudence are of course expected at the very least because the ECB is a very important institution and is expected at the very least because the judgment in the Verso Bank has been already appealed and the same could also be done for the ECB judgment. Next slide please. I will now speak about the legislative developments that affect cooperation between the ECB and NCA's in the area of AML CFT. Since 2013 the legislation via its legislative proposals amending Seer D4 that the union co-legislators adopted established new rules in the area of AML CFT that further strengthened the assistance of national authorities for the supervisory work of the ECB. The so-called Seer D5 amendment adopted in June 2019 the obligations of cooperation between competent authorities, financial intelligence units and authorities entrusted with the public duty of supervising credit institutions under the AML directive. All those authorities within their respective competences must now provide each other with information relevant for their respective tasks under Seer DCR and AMLD. In particular where the evaluation of the government's arrangements the business model or the activities of the institution gives the banking supervisor reasonable grants to suspect that money laundering or terrorist financing is being or has been committed or there is an increased risk thereof. The supervisor is subject to a legal obligation to immediately notify the AML authority. The supervisor and the AML authority will then produce their common assessment to be immediately sent to the EBA. The next amendment, the Seer D6 proposal adopted by the commission in October last year and currently still examined by co-legislators attempts introducing further AML CFT means that are considered essential for maintaining stability and integrity of the financial system in the union. The banking supervisors under the proposal would be required to consistently factor in money laundering and terrorist financing concerns into the relevant supervisory activities. The CFD6 proposal specifically focuses on the acquisition and the issue of qualifying holdings, material transfers of assets and liabilities emerges and divisions as well as authorization of third country branches. All those operations are considered to be material for the functioning of credit institutions. And therefore competent authorities would be required to assess whether money laundering or terrorist financing is being or has been committed or attempted or there is a risk of such an activity before the proposed operation could be approved. A final compromise between the European Parliament and the Council on the CFD6 proposal is not however expected until the end of this year and to be seen how at the end the provisions adopted be specifically formulated. I would like to draw some conclusions on the debated subject. It is to be considered that exclusive supervisory powers conferred to the ECB by the SSM regulation specifically did not include responsibilities in the area of AML CFD as those responsibilities were left with the relevant national authorities. The Warsaw Bank and the AAB judgments provided dividing lines between the assistance of NCA and the decisional discretion of the ECB when establishing and assessing AML CFD breaches in the authorization withdrawal process. Those judgments also confirmed the autonomous value of the AML CFD related breaches and justifying the withdrawal of authorization. An explicit legal basis for integrating AML CFD risk into prudential supervision came into effect in June 2019 with the CRD5 amendments and provided the ECB with the ground for looking into the AML CFD risk when carrying out prudential supervision. Given the importance of the AML CFD policy in the union the commission's proposal for CRD6 clearly aims at further strengthening the synergies between the AML CFD monitoring and prudential supervision. Thank you. Thank you very much Odrone for this clear uncomprehensive presentation of the delineation of powers within the SSM and also for providing an interesting insight in the recent developments in the regulatory framework. I am happy to give now the floor to Georgia who will present very interesting reflections on the ECB duties that the ECB has to comply with when taking supervisory decisions that have to integrate also AML CFD aspects. Georgia the floor is yours. Thank you Carmen and good afternoon everybody. So in her presentation Odrone explained that even though the ECB is not competent to supervise compliance with AML CFD legislation it integrates AML CFD concerns systematically when performing its prudential tasks. In light of the close connection between AML CFD supervision and prudential supervision it is essential that the ECB truly accounts for AML CFD aspects in the exercise of its supervisory tasks. It is yet equally essential that in doing so the ECB remains within the remit of its competence and does not exceed the boundaries of the powers conferred on it by the SSM regulation. So the delicate balance of these two aspects brings into play as you can see in the slide the principles of union law. On one side we have the principle of care as defined by union courts which sometimes refer to this concept also as duty of diligence. So this principle requires institutions to perform a full and impartial assessment of all relevant facts before exercising their powers. On the other hand we have the principle of providing that the European Union can act only within the limits of the competencies conferred upon it. So this will be the focus of my presentation today which will review how the ECB when examining AML CFD aspects complies with the principle of good administration and in particular with the duty of care without overstepping its powers. Next slide please. The first part of my discussion is the notion of duty of care which became widely acknowledged following the landmark judgment delivered in 1991 by the Court of Justice in the Technische Universität München case. The formulation developed in this judgment which was often reiterated in subsequent case law identifies the duty of care as the duty of the competent institution to consider carefully and impartially all the relevant aspects of the individual case when adopting its decisions. So union courts consider the duty of care to be inherent in the principle of good administration and have consistently ruled that this duty applies also when an institution exercises discretionary administrative powers. In fact, in the court's view the duty of care is all the more excuse me for this interruption. I think we have some technical issues with the camera and unfortunately the audience cannot see you. I'm not now the most interesting person to do that. So apologies for this. I think we are going to change places so you can really see Georgia and listen better to the interesting presentations. In the court's view compliance with the duty of care is all the more important in procedures for the adoption of decisions entailing a broad discretion. As in these cases the institution's power of appraisal is so to say circumscribed by the principle of care. Many eminent scholars have investigated the central role played by the duty of care in calibrating the intensity of judicial review of discretionary acts. Underlining how this duty has become a tool for union courts to revise the factual basis of administrative decisions. One of these scholars, Professor Hoffman in his research on the role and scope of the duty of care requirement distinguishes two dimensions of the duty of care. The first dimension is the so-called factual element connected to the fact collection activity underlining administrative decisions whereby in principle or relevant facts substantiating a decision shall be collected by the decision making authority. Compliance with this dimension of the duty of care requires that evidence collected for the purpose of the decision contains all the information which must be taken into account in order to assess a complex situation so the most complete information possible but also that such evidence is factually accurate and consistent so the most reliable information possible. The second dimension of the due care requirement is the so-called cognitive element which entails a diligent and impartial assessment of the evidence collected. So compliance with this second dimension of the duty of care requires that the final act can logically be based on and is consistent with the factual and legal elements on which it relies. For the decision containing a broad discretion compliance with this second element of the duty of care is all the more important according to the court. Because the exercise of that discretion is only subject to judicial review of the merits confined to examining whether a manifest error has been submitted. The duty of care is therefore a general obligation which union institutions shall comply with throughout the process leading to the exercise of their administrative powers and the adoption of their decisions. It should be noted though that the scope of such obligation cannot be defined in general terms and shall rather be assessed on a case-by-case basis. The duty of care is therefore to use the words of advocate general Spooner in the recent case SGL Carbon versus Commission an obligation of variable contours since its scope is shaped by the provisions determining the powers and the discretion of an administration in a particular case. This is a relevant point for our discussion because it suggests that the scope of the ECB's duty of care not only cannot be at odds with the boundaries to the ECB's competencies but is even shaped by them. So in the present case, this entails that since supervision of compliance with AML CFP legislation is not a task which has been conferred on the ECB the ECB cannot carry out AML CFP related supervisory tasks or enforce AML CFP legislation. If this were done, the ECB would encroach on the competence of national authorities and would thus breach union law. In concrete terms, this means that whenever AML CFP aspects come into relevance for the adoption of its decisions, the ECB needs to rely on facts established by the relevant AML authority. This leads us to examine how the principle of conferral contributes to delineate the scope of the ECB's duty of care when assessing AML CFP aspects. An attempt to better define this scope can be made building upon the two previously recalled dimensions of the due care requirement. So in the fact collection phase, since the ECB lacks, as we have seen the competence to investigate or establish itself the facts submitted by the AML authority, the reliability of such facts may only be assessed by verifying whether they appear to be well founded, sufficiently specific, accurate and consistent. For this purpose, the ECB should take into account all relevant aspects of the concrete case, including how and where the determinations of the AML authority have been made and should request if needed relevant clarification and additional evidence to the AML authority. An analogy could be drawn with the scope of the duty of care of the council when adopting restrictive measures upon information provided by the sanctions committee of the United Nations or by authorities of a third country. According to the case law in this field, the council, in order to discharge its duty of care, is required to assess on the basis of the circumstances of the case whether it is necessary to seek the disclosure of additional evidence from the sanctions committee or the third country authority if it transpires that the evidence already supplied is not sufficient. Different considerations come into relevance when we look at the scope of the ECB's duty of care when performing the assessment of the factual and legal elements of the case in order to conclude whether the adoption of a certain decision would be warranted. So in this phase, the assessment phase, the scope of the ECB's duty of care is not constrained by the boundaries to the ECB's powers because this assessment only rests on prudential considerations which internally fall in the ECB's competence. The ECB, in fact, enjoys full discretion in assessing which conclusions, if any, are to be drawn from AMN CFT findings for the purposes of potential prudential supervisory action. A concrete example of how the two dimensions of the duty of care requirement interact when the ECB examines AMN CFT aspects in the exercise of its supervisory tasks can be found in license withdrawal procedures based on serious breaches of AMN CFT provisions. Next slide, please. So in this respect, it should be recalled that in the SSM legal framework, the ECB has the exclusive competence to withdraw authorizations of all creating institutions irrespective of their size. From a procedural perspective, the withdrawal of a license qualifies as a composite procedure where the NCA submits a preparatory act and the ECB exercises alone the final decision-making power. Taking, of course, into full account the justification put forward by the NCA but without being bound by its proposal. So the legal framework, while allowing the ECB to exercise full discretion on the decision to withdraw a license, expressly requires it to take into account some elements when doing so. These elements are laid down in article 83 SSM framework regulation, which sets the standard of the ECB's duty of care in the context of withdrawal procedures and plays an even more important role in the context of license withdrawals concerning less significant institution falling under the direct supervision of relevant NCA's. This is compliance with the duty of care in the context of withdrawal procedures based on serious AML CFD breaches as been subject to judicial review into recent judgments of the general court which provide interesting clarifications on this topic. Next slide, please. The first judgment concerns an action for amendment against the ECB decision when drawing the license of the Arsobac. The contested decision was based also on the grounds for withdrawal under article 18F in conjunction with 6710 CRD. In regard to the FSA's findings of NCA's findings of repeated and serious AML CFD breaches committed by the bank, in the part of the judgment dealing with the ECB's compliance with the duty to conduct a careful and impartial assessment of the relevant aspects of the case, the general court views an argument which brings together the principle of care and the principle of conferral. The premise on which the court's reasoning the rest is that in light of the allocation of powers and the cooperation duty between the ECB and the FSA, so the NCA within the SSM, the ECB was indeed entitled to rely in order to substantiate its decision on the information included in the NCA's proposal. Based on this premise, the court further developed its argument with reference to specific facts included in this proposal, namely the FSA's findings of breaches which have not been properly challenged by the bank and considers that these findings had to be treated by the ECB as established facts and as not requiring for that reason a review by the ECB. The conclusion, this conclusion reached by the court takes account of the fact that as we already said when it comes to AML CFD breaches the ECB needs to rely on the findings of the AML authority. This, however, cannot offset the ECB's obligation to comply with the principle of care. A relevant indication in this direction can be found in the prominence given by the court to the fact that in the present case the breaches had not been properly challenged by the bank. So this is an element which corroborates the reliability of the FSA's findings. It is therefore only after having assessed that these findings constituted a complete and reliable set of information that the ECB had to consider them as established facts and again, put in the court, rightly confined itself to verifying whether they indeed constituted grounds justifying the withdrawal of authorization. Next slide, please. The second judgment providing relevant clarifications on the scope of the ECB's duty of care in the context of withdrawal procedures concerns the action for annulment against the ECB decision withdrawing the license of angry Austrian banks, AAB bank. In this judgment, the court reviews the ECB's compliance with the duty of care, drawing a distinction between the two grounds for withdrawal on which the contested decision was based. As concerns on the one side, the ground related to serious AML CFD infringements, the court notes that the ECB complied with the duty of care because it demonstrated the existence of relevant facts justifying the withdrawal of authorization by relying on available evidence, such as, for example, decisions of the national authorities, so the FMA in this case, and rulings of national courts. Therefore, the ECB did not simply refer to the breaches laid down in the FMA's proposal, but it asserted a constate in the judgment for the purposes of the examination of facts and evidence available that the bank had been found liable of serious AML CFD breaches. As concerns the ground for withdrawal relating, on the other hand, the failure to have in place appropriate and robust governance arrangements, which is a matter that contrary to AML CFD aspects falls squarely within the ECB's competence, the court notes that the ECB complied with the duty of care because it verified itself, the breaches of prudential provisions asserted by the FMA, meaning that the ECB based its decision on its own assessment of compliance with national provisions transposing article 74 CRD in the Austrian legal framework. So the findings of the court in the AAB Bank case, therefore, confirm that compliance with the duty of care is to be assessed against the scope of the ECB's competence. Next slide, please. While the Verso Bank and AAB Bank judgments offer a valuable contribution in clarifying how the ECB should integrate AML CFD concerns in withdrawal procedure, they still leave open the point concerning the scope of the ECB's duty of care in the exercise of other supervisory tasks, such as, for instance, the assessment of qualifying holding acquisitions. Interesting questions which arise in this respect concern, for instance, the scope of the ECB's assessment of criteria under article 23.1 CRD. So the criteria related to suspicion of monitoring or terrorist financing or the increased risk thereof. And of course, the standard of reliability for evidence substantiating such criteria. Further reflection in my view would be warranted on these aspects which deserve particular attention also in light of practical implications they may have on the interaction between the ECB and national authorities in the context of qualifying holding procedures. In conclusion, although the findings of the court in the Verso Bank and AAB Bank cases do not provide a direct answer to all open questions, it seems to me that these judgments read together with the case law on the duty of care clearly show the direction which the ECB should follow to address them. Thank you so much for your attention. Thank you very much, Georgia, for this interesting presentation and also to bring into our attention interesting open questions that on which I will agree with you further reflection. It's needed. I am looking forward to listen to Raphael now who will bring the interesting perspective of an NCA and as we will hear in a minute from Raphael, an NCA that also has its own specificities that make it very even more interesting. Thank you. Rafa, the floor is yours. Okay, many thanks Carmen, Audron, Georgia. Hello, everyone. Please, let's move to the slide with the agenda, please. The second one. Well, the purpose of my presentation is to further describe a bit the particularities of the Spanish framework on the supervision of antimony laundering and also presenting you some legal challenges that Banco de España faces as prudential supervisors. Then I will raise some open questions and reflections on the potential impact that recent court cases like Versubang may have on the prudential supervisory practice followed so far. Finally, I will close with a short recap but I would like also to give you a flavor of the new legislative developments on the antimony laundering area, complementing the initiatives presented by Audron in the CRD. Please bear in mind that for being more fluent while speaking I will also refer to MLA instead of the long version of antimony laundering and court of terror is finance. Next slide, please. So as a short introduction to my presentation I will talk about the relevance of MLA risk in the prudential supervision of banks which Audron has already announced. Cases of breaches of MLA legislation has shown that indeed they have a significant impact of banks. Money laundering can damage bank's reputation. Governance arrangements, the funding and also affects the customer relationships. But not only that, on a larger scale those breaches are a threat to the availability of banks. Therefore, as a conclusion the way banks design their AML functions are relevant to prudential supervisors along the life cycle of banks. This is when granting a bike license when assessing where the bank managers are fit and proper for the job in the assessment of acquisition of qualifying holdings but also on ongoing basings, for example, in this rep. Finally, the competent authority should also take them into consideration to assess whether and when a bank license should be withdrawn due to AML breaches. The impact of MLA risk in the prudential supervision has been already acknowledged by European legislators who have been taking steps to strengthen the link between AML and prudential supervision. As Adron has explained there are more amendments to come in the CRD6 to further reflect the interaction between both areas. Next slide please. So the European legislator has decided so far that the competition on AML should remain under the national authorities. This is of course without the prejudice of the leading role of the European banking authority that is looking for a more consistent AML supervision and the future European authority on AML that I will mention later. As there are evident links between AML and prudential supervision in the vast majority of SSM jurisdictions national legislators have opted for allocating the supervision of AML risk also to the prudential supervisor. However, in other jurisdictions like Spain or Malta and at the SSM level, the ECB, the AML authority is not the same as the prudential supervisor. As a consequence in these scenarios it is essential that both supervisors exchange information and work very closely. In any case, the delineation of risk and competence between AML and prudential framework is not so easy. On the table shown on the slide I describe the main differences between both frameworks. However, I will only mention the purpose. So while the prudential framework looks for ensuring the safety and subnet of banks with the objective of protecting depositors and maintaining financial stability the AML framework is most focused on verifying that the obliged entities which goes beyond banks and financial institutions have in place proper procedures and safeguards to avoid money laundering as well as to collect and analyze suspicion transactions. Next slide please. Against this background it is convenient to draw a line and delineate the competence of AML and prudential supervisors including the ECB. In other words, an answer to the following questions is essential. Where do the competence of prudential supervisors end and those of AML authorities begin? And how should each authority rely on the facts served by the other in order to exercise their own competences? These challenges are even more relevant in jurisdictions where the AML and prudential authorities do not rest within the same institution. Well, the good news is that the General Corp in the Warsaw Bank and Anglo-Austrian bank cases have brought some light on these questions. Odrond and Georgia has went into the content of these pieces of legislation but I would like also to stress what for the purpose of my presentation is the main takeaway. That is that while setting the facts establishing breaches of the AML legislation falls within the competence of the AML supervisor the legal assessment and the proportionality of the prudential measures to tackle those breaches from a prudential perspective lies on the prudential supervisor. Next slide please. Well, in these three slides I will introduce the Spanish AML institutional setting. Let me anticipate you that it is quite complex so I try to simplify it. So basically we have centralized on one authority the AML task. This is the commission for the prevention of money laundering and monetary infringements the so-called COPLAC. COPLAC is a collegiate body under the umbrella of the Ministry of Economic Affairs and is composed by representatives from a wide varieties of AML agencies policy makers, the Ministry of Economic Affairs the public prosecution, police and also financial entities, prudential supervisors. Two bodies support the COPLACs in the performance of its mandate. The secretariat and the executive service for the prevention of money laundering and monetary infringements, the so-called COPLAC. Focusing on the COPLAC this is the financial intelligence unit and also has been entrusted with the supervision of AML obligations but, and this is relevant here the supervision would be done in cooperation with prudential supervisors provided that there are in place a memorandum of understanding with that authority. Next slide please. Let me now elaborate a bit more of this memorandum of understanding between the COPLAC and Banco de España. Why I am MOU? It is because the Spanish law on MLA provides that the prudential supervisor can only carry out the supervision of certain AML obligations of entities under their prudential supervision scope provided that an MOU with COPLAC is in place. So the MOU is the instrument that gives Banco de España AML supervisory task. In 2021, a new law was negotiated. This MOU develops the cooperation and information exchange between CEPLAC and Banco de España and also reflects the SSM and the need to come on the ECB as a new player. This is the fourth agreement in place since 2005. Due to time constraints I will only highlight a few points on the MOU. Next slide. So the MOU allow Banco de España to carry out material inspections of several AML obligations of banks but in cooperation with CEPLAC. The MLA obligations that are assessed by Banco de España are those procedures and arrangements of banks related due diligence, reporting obligations and internal control. However, please keep in mind that COPLACs retain the authority to issue binding requirements or impose sanctions. So then how does a framework work in practice? So basically, when Banco de España carries out AML inspections it can directly issue recommendations to banks to overcome the AML deficits. This is done on the inspections report. However, if Banco de España considers that the deficiencies imply breaches of AML regulation it should draft a report to COPLAC proposing to either issue a binding request and or to open sanctioning procedures. In any event, COPLAC and based on the findings detected can take on its own initiative any measures without a proposal from Banco de España. It is worth saying that if Banco de España considers that those breaches of AML obligations have a prudential impact on the banks it will be for Banco de España or the ECB in their capacity of prudential supervisors to take the appropriate prudential measures over the credit institutions. Finally, in my opinion this Spanish framework is compatible with the VersoBank management management. Let's move into the next slide please. In this slide you can see the difference of scope of AML supervisory tax between CPLAC and Banco de España. While CPLAC is in charge of the supervision of the whole catalogue of LIGHTS entities Banco de España's tasks are limited to the financial entities such as to the prudential supervision. The main reason for centralizing at national level the supervision of all AML of LIGHTS entities is to reach a consistent domestic supervision in the field of AML. Next slide please. Now let me go onto the main legal challenges that Banco de España faces from a legal point of view in its capacity as prudential supervisor. The first one that I would like to talk concerns the allocation of competence to withdraw the Banque license due to breaches of AML. In the Spanish legal framework the withdrawal of license due to serious breaches of AML is only provided as a sanction in the law transposing the AMLA directive. But it is not provided as a ground for withdrawal in the transposition of CRP. Moreover, the competence to impose such sanction is for the Council of Ministers at the Proposal of Ministers Economic Affairs and with a report from the supervisory authority. Let me stress that this distribution of powers under the Spanish framework fits in the AMLA directive. In particular, the second paragraph of article 58 of the directive allows member states to decide which national authority will be the competent authority for AML tasks including for the imposition of the sanctions such as the withdrawal of the authorizations. Please note that the paragraph 5 of the mentioned article 58 the AMLA authorities may exercise their powers to impose sanctions directly but also in collaboration with other authorities. Therefore, the allocation of the competence to the Council of Ministers for imposition of such sanctions would be the option chosen by the Spanish legislator within the margin of discretion provided by the AMLA directive. However, it is worth saying and recognized that this national regime seems not to be aligned with the distribution of competence established in the CESN regulation. Indeed, according to the CESN regulation it will be for the ECB the exclusive competence to authorize and withdraw the binding license of both significant and less significant institutions and also in cases of withdrawal due to AML serious breaches. This exclusive competence of the ECB has been endorsed by the General Court in the Verso Bank and also in the Anglo-Astron Bank cases. So, what should we do in this context? Also, in our jurisdiction we have not faced yet any withdrawal license due to breaches of AMLA rules. The legal conflict would be overcome by invoking the primacy of EU law and the direct effect of EU regulations. However, and among us I would rather prefer an amendment to our national legislation in order to solve this misalignment. Please, Mrs. Leith. The next challenge that I would like to talk about is regarding the way risks related to AMLA are considered in different Prudential Supervisory Procedures in particular, Qualifying Folding and Licensing. In both procedures, the Spanish framework requires a report from the AML Authority assessing the AMLA risks and transactions or the procedures and mechanisms for dealing with monilandering risks in case of authorization procedures. As in the Spanish framework the AMLA and Prudential Authority beferred the approach followed so far by Banco de España's Prudential Supervisor is to rely on the judgment of the AMLA Authority when assessing the AML risk in those supervisory procedures. The open question that arise here is whether the recent Verso Bank ruling would affect the practice followed so far. In my personal opinion the reflections made by Georgia regarding the duty of diligence are also applicable to DCB would also be useful for Banco de España in its capacity of Prudential Supervisor. However, as she mentioned there are still open questions on how to the duty of diligence apply when assessing the risk of monilandering and Qualifying Folding. Next slide please. I think if time constraints allow me I would like to finish my presentation with a short recap. The first one concerns the national regime of the location of AMLA task. As I mentioned even if a centralized supervision of AMLA of rights entities could have a few advantages like domestic consistency we have seen that it has also some challenges. It is more complex and hinder combinations between relevant authorities. This framework is not aligned with the predominant institutional setup in place in nearly all European countries. Therefore, in my opinion an allocation of the supervision of AMLA obligations related for example to internal controls and governance arrangement with decision powers to Banco de España could benefit from the synergies coming from the Prudential Supervision and would also contribute to the institutional efficiency. The second takeaway is that the recent core cases Verso Bank and AAB bank cases give us some food for thought on the way Prudential Supervisory Prudential Authorities should use relevant AMLA facts. The last reflection that I would like to make is a look into the near future. As you all know the EU approach in the AMLA field is based on a minimum harmonisation directive with a strong focus on national law. However, money laundering cannot be fought in isolation. Complimenting the developments explained by your drawing in her presentation the European legislator is taking steps towards harmonisations on the approach to tackle AMLA issues. In particular I would like to mention three instruments of the new proposal of the AMLA legislative package. The first one is the draft regulation establishing a new European authority with supervisory competence on AMLA. It will be a central authority that will coordinate national authorities to ensure that private factors consistently applies the EU rules. It will also exercise direct supervision over certain financial institutions. There will be also a new AMLA regulation with direct applicable rules that will deepen the harmonisation at the European level of certain AMLA obligations, like due diligence. And finally the legislators are also working on an update to the directive on AMLA that will be the sixth. We intend to reinforce the powers of national supervision and financial intelligence unions and will also increase harmonisation. That will be all from my side. Thanks a lot for your attention. Thank you to you, Rafa, for adding this interesting perspective of an NCA also for sharing with us very relevant reflection. A very special thank you for the three panellists for being so mindful of the time and so efficient in the presentation, which allow us now to have a rich discussion. Let me remind you about the rules to ask questions. I say that at the beginning just use the hand button in your Webex and at that point you will be invited to ask the question. In that moment is when you have to unmute yourself and switch on your camera so we can all listen to your questions. So, while we wait to the audience, from questions from the audience I may start with one myself that I can share with the panellists. I invited any of them who would like to reflect and it's related to the notion of breach of AML and CFT requirements and the joint report of the European Supervisory Authorities on the withdrawal of authorization for serious breaches of AML CFT rules published recently in May of this year says that a breach should be understood as any violation of AML CFT committed by an obliged entity which has been identified by the competent authority so the AML CFT supervisor. I personally find this definition very sensible and in my opinion it's fully in line with the way the ACP has applied the notion of breach in practice and is particularly interested in the views of the panellists about the way the AML CFT competent authority should identify this breach. I personally will say that the legal provisions and also the recent cases to which you have referred during today's panel do not impose any limitations or formalities on how this determination or identification of the breaches is done by the competent authorities but I would be very much interested in listening the views of our panellists today also on this question and I don't know if maybe Odrone or Georgia would like to start. I can start maybe, yeah. Yeah indeed Carmen I fully agree with you. I think that the legal framework when it refers to these institutions being found liable of serious AML CFT breaches provided of course a very important indication which competent authorities exercising the power to withdraw the license should follow but it is not in my view a very narrow field so in the sense that in compliance with the scope of the ECB's duty of care I believe that on a case-by-case basis it should be assessed whether the source where the information the evidence provided by the AML authority in which the breach is established should be assessed by the ECB in order to consider for example whether this is I don't know a preliminary report or rather a final or satisfaction report this was the case for example of Berserk, this is in the background of the Berserk judgment or an administrative decision or a ruling of a national court which is in the factual background of the AAB case so I don't think there is a close list of documents which could or should provide evidence of this breach what is important in my view is that the ECB when assessing these documents provided by the AML authority does it with a view of ensuring that it carries out a complete examination of all the information and that this information appears to be reliable in light with the indication provided by the case law on the digital care Thank you Georgia Thank you Carmen Please, please Yes Yes Thank you Carmen I share Georgia's view that we should not see the list being set out evidence and facts that is fully within the limit of national authorities that implement acts transposing AML directive and indeed the variety of situations would not necessarily speak for such a narrow list being established we've already discussed in this panel that the evidence and facts fall within the competence or establishment of facts and evidence falls in the competence of the national authorities that follow the relevant national procedures for that purpose and the ECB nevertheless even if it has to rely on the facts and evidence obtained from the national authorities it carries out its own assessment and legal appreciation because at the end for instance more specifically the withdrawal of banking authorization it is the ECB that has to defend its decision in court and that's why this assessment that the ECB is of alternative importance of I'm sorry we are facing the situation we cannot hear you very well the connection got interrupted but at least myself I could get you were following a bit the same line as Georgia it was a bit unfortunate that with the connection we could not hear absolutely everything you said but I think I can say I understood that you are very much in the same line as Georgia yes that's correct thank you very much thank you I hope we can reconnect soon fully with you in the meantime I see we have questions from the audience the first one is coming from Giovanni Bassani Giovanni I think you will be invited now to ask your question please do not forget to unmute yourself and switch on your camera and the floor is yours we can hear you a bit far away Giovanni sorry I tried to speak I think you have to try to speak loud ok I will try to speak loud so thank you for the presentation I think it was very clear and also this general distinction in the framework between assessment I mean verification of the facts and assessment of the facts whether they amount to justifiable grounds for withdrawal or I would say in the case of qualifying only for objection my question is more related to the future because I discovered recently that actually in the CRD6 proposal from the commission this sort of separation and distinction would be actually at least for qualifying only would be obliterated because my understanding is that the proposal from the commission would actually give a sort of power for the national anti-monetary authorities to object to a transaction at least as far as I understand only for qualifying only for withdrawal so this decision would be maintained for the withdrawal of a license but to object to an acquisition of a qualifying holding and if this acquisition is in writing the ECB or potentially in other member states other supervisory authorities take note of this objection and oppose the acquisition and this seems to be really a very significant change in this neat distinction and separation of competencies where actually the national anti-monetary authority would have a sort of veto powers on what the the presidential supervisory authority is actually going to do I was wondering how much this significant change has been so true and also for instances for aspects are related in the case of the ECB or change is also in the jurisdictional competence of challenging this supervisory decision because it will probably go back to the national court so it seems to be a very significant change I'm not sure how much this change of the general framework has been actually so true thank you thanks a lot Giovanni I'm thinking as the question concerns the commission CRD proposal you may want to start sharing something all right do you hear me yes all right so indeed the provision on qualifying holdings is one of those that is subject to the CRD hello yes we hear you Oderone maybe if you try to switch off the video it's a bit but I want to try please stop I'm strange stop no yes maybe the technical service could follow my GSM unfortunately I think we have some difficulties to follow Oderone do you hear me now yes let's give another try all right so we are of course speaking about the commission's proposal which is in negotiations with co-legislators and we don't know how will the provision in question will look like once adopted now the objective behind that provision indeed was to give a more prominent role to the AML authorities and that is at least how I see it very much in line with the general policy objectives of the union as well as what we see in the case law that has been discussed in the panel so essentially with that in case of qualifying holdings the AML authorities would still be the ones that could establish the relevant facts and gather evidence and provide of course its assessment to the banking supervisor I would not myself read the provision in question as establishing a veto power as a colleague has referred to because that in my view would somewhat tend to upset the competencies attributed to the banking supervisors and would upset the balance of course if the provision is adopted as it is it would require an interpretation not only probably at the level of the institutions but eventually would require an interpretation from the court and if we speak about here a composite procedure where there is a decision of the AML authority and then the banking supervisor has to take a decision as well the question naturally arises who bears responsibility for such a decision and who is the proper defendant so I think this is a very pertinent question to be seen how the provision looks once adopted but the intention in my view of the commission when adopting the proposal in particular with regard to this provision was to strengthen the role of the AML national authorities thank you thank you very much Odrone interesting question and let's see how finally this proposal is adopted and let's hope that yes the commission, the legislator provide all necessary clarifications for the ACV for the potential supervisors to apply it in the most effective manner thank you I think we still have time for another question I think we can give the floor to Jakob Czerowski Jakob Czerowski Jakob please remember to unmute your microphone switch on the camera don't get worried if it takes a few seconds to Webex and then we will be able all to see you and listen to your question thank you I believe that you must see me by now yes we do thank you Cameron I was wondering in light of the relationship between the ANCS and the ECB which I understand has been clarified to a certain extent when it comes to AML supervision in recent judgments all these judgments concern to withdrawal decisions I was wondering whether the panelists believe that they already provide enough clarity also for other areas where AML is prominent such as qualifying holdings and fit and proper supervision or whether they would welcome some more clarity from the court also perhaps in challenges to say qualifying holding decisions or how do they view the court findings provided so far thanks a lot Jakob for the question Georgia would you like to give your views so indeed Jakob I fully agree I mean we have seen thanks to Podron and Rafa's presentation that the union legal framework required the ECB to take into account the AML CFP aspects when performing its supervisory tasks we have also seen that the judgments in Verso Bank and the AEB Bank in these judgments the general court consider that indeed while the competence to supervise compliance with AML provision is a competence which remains with national AML authorities the ECB still has a duty to form a diligent examination of the findings of such authorities to the extent these findings are relevant to substantiate the ECB's own decision so I believe that this conclusion is applicable to all the other supervisory tasks to the extent in which the ECB in the exercise of them takes into account or factors in AML CFP considerations so I'm thinking of course about other qualifying procedures so license granting of a license in qualifying goldings but also as you correctly mentioned but also ongoing supervision itself so all these cases in which for example AML deficiencies could be a symptom of sound governance or deficiencies in internal control mechanism so I think we have this important indication from the court I also believe at the same time that for specific supervisory tasks additional qualifications from the court concerning a more precise delineation of the scope of the ECB's duty of care would be welcome I have in mind again the topic of the qualifying all-day procedure because this is a very different procedure from the withdrawals so for example the type of evidence which usually substantiates a potential negative qualifying goldings so the opposition to the acquisition of a qualifying gold is evidence which does not relate or that's not only relate to past facts such as in withdrawal cases of these breaches of AML provisions it's also mainly a forward-looking assessment so this is a different type of evidence it would be interesting to know how the court considers that the ECB should assess this evidence which is more an assessment just this component of an assessment of a forward-looking assessment and in addition the very same provision under article 23 paragraph 2 stipulates that the ECB may oppose the acquisition of a qualifying golding when there are reasonable grounds to consider the relevant criteria are met and this is also an interesting point so when is this forward-looking evidence conclusive to achieve the determination that the criteria needs met because this reasonable ground seems to point to a different standard compared to the standard of conclusive evidence which is required for withdrawal decisions so these are all points which differentiates a bit the type of assessment of a qualifying golding acquisition and of a withdrawal decision on which I believe I personally believe that further clarifications from the general court from the union court would be would be welcome Thanks a lot, Georgia I don't know if Odrone or Rafa would like to share something on this also Very briefly I would like to mention the judgment of 2018 in the Berlusconi case where the court examined the ECB decision opposing an acquisition of a qualifying holding by a company owned by Mr Berlusconi who was convinced convicted of a tax fraud of course we are not speaking about the AML, CFP but we do have this very prominent judgment of 2018 regarding qualifying holding procedure that was applicable at the time and I would suggest also not to forget this judgment that could be reread looking for some interesting insights, thank you Thanks a lot, Odrone and thanks for spotting this which is fully true and we have this very important case concerning the allocation of competencies in the field of qualifying holdings indeed From what I can see I think we do not have other questions from the audience and therefore this I think with this we are bringing to an end our discussion today I would like to thank again the panelist for the interesting presentations and for being here and also all the audience for listening to us I saw that we have had 102 participants and also we had very stimulating questions I thank you all also for this I would like to remind you that we will resume at quarter past four with Chiara's concluding remark and to close the conference so I think we have now time for a little break and I'm looking forward to see all of you again or to welcome you again for the conclusion of the conference in 15 minutes Thank you very much again for your participation