Safeguarding Financial Integrity and Privacy in the EU's Internal Market: Balancing Anti-Money Laundering Obligations against Fundamental Rights to Privacy
(2023) JAEM03 20231Department of Law
Faculty of Law
- Abstract
- The thesis explores the EU’s anti-money laundering framework’s compatibility with conditions required under privacy rights. It asks the question whether the anti-money laundering framework confers obligations to private entities and other actors not belonging to law enforcement in a way which risks violation to the fundamental rights to privacy and data protection. The thesis elucidates the significance of privacy rights in the EU as underpinned by the principles of privacy in the European Convention of Human Rights. Moreover, the thesis examines the lawful conditions for far-reaching data-processing. It clarifies that the cases of the Court of Justice of the European Union require, among other conditions, clear and precise rules to limit... (More)
- The thesis explores the EU’s anti-money laundering framework’s compatibility with conditions required under privacy rights. It asks the question whether the anti-money laundering framework confers obligations to private entities and other actors not belonging to law enforcement in a way which risks violation to the fundamental rights to privacy and data protection. The thesis elucidates the significance of privacy rights in the EU as underpinned by the principles of privacy in the European Convention of Human Rights. Moreover, the thesis examines the lawful conditions for far-reaching data-processing. It clarifies that the cases of the Court of Justice of the European Union require, among other conditions, clear and precise rules to limit the extent of interference of the right to privacy and, a link to serious crimes, to process personal data in a far-reaching manner. Additionally, the thesis highlights the complementary role of the General Data Protection Regulation in support of privacy rules within the internal market.
It finds that the AML-directives rely on private entities for the detection, monitoring and reporting of all individuals using financial services while including few safeguards to limit the interference with the right to privacy. Instead, the AML-directives direct the responsibility of safeguarding data protection to the Member States, despite providing few incentives for the adequate protection of data privacy while fulfilling the AML-objectives. Furthermore, it is found that there is uncertainty regarding which data-protection framework a financial intelligence unit must be subject to, resulting in discrepancies in data-protection commitments during the request of exchange for information. Consequently, another Member State’s financial intelligence unit has access to a vast amount of personal data with little to no restriction. It therefore states that there are multiple risks of violation of the EU Charter as Member States are required to navigate and comply with the conflicting AML-obligations and the robust privacy rights.
Against this background, the thesis concludes that there are risks that Member States violate the principles of necessity and proportionality under Article 52(1) of the EU Charter due to the incoherency of norms. Lastly, the thesis reiterates the commercial roots upon which the internal market is established could lead to an overshadowed fundamental rights protection while prioritising commercial mobility using Article 114 TFEU. Consequently, such legal incoherency could erode the privacy rights established under Articles 7 and 8 of the EU Charter, overshadowing the fundamental right to privacy. (Less) - Abstract (Swedish)
- Uppsatsen undersöker EU:s åtgärder mot penningtvätt och finansiering av terrorism (AML-direktiven) och dess förenlighet med rätten till privatliv och dataskyddsregler. Då långtgående befogenheter att behandla personuppgifter för brottsprevention och upptäckande av penningtvätt traditionellt sätt har tillhört brottsbekämpande verksamhet ställer uppsatsen frågan huruvida AML-direktiven ger befogenheter till privata aktörer på ett sätt som riskerar oproportionerlig inskränkning av rätten till privatliv och dataskydd enligt EU-rättsliga principer.
Vikten av EU stadgans rätt till privatliv och dess grunder i mänskliga rättigheter och Europakonventionen beskrivs i uppsatsen och de legala förutsättningarna för långtgående databehandling... (More) - Uppsatsen undersöker EU:s åtgärder mot penningtvätt och finansiering av terrorism (AML-direktiven) och dess förenlighet med rätten till privatliv och dataskyddsregler. Då långtgående befogenheter att behandla personuppgifter för brottsprevention och upptäckande av penningtvätt traditionellt sätt har tillhört brottsbekämpande verksamhet ställer uppsatsen frågan huruvida AML-direktiven ger befogenheter till privata aktörer på ett sätt som riskerar oproportionerlig inskränkning av rätten till privatliv och dataskydd enligt EU-rättsliga principer.
Vikten av EU stadgans rätt till privatliv och dess grunder i mänskliga rättigheter och Europakonventionen beskrivs i uppsatsen och de legala förutsättningarna för långtgående databehandling undersöks. Det framgår att rättsfall från EU-domstolen kräver uttryckligt angivna och preciserade regler för att begränsa omfattningen av ingrepp i rätten till privatliv. För att behandla personuppgifter på ett långtgående sätt ställs det även krav på att informationen som behandlas har koppling till allvarliga brott. Dataskyddsförordningen har en kompletterande och praktisk funktion inom den inre marknadens integritets- och dataskyddsnormer som privata aktörer måste förhålla sig till vid behandling av personuppgifter, vilket ställer ytterligare krav på lagenlig behandling av personuppgifter.
AML-direktiven förlitar sig på privata aktörer för brottsupptäckande, övervakning och rapportering av alla individer som använder finansiella tjänster samtidigt som de innehåller få skyddsåtgärder för att begränsa ingreppet i rätten till privatliv. I stället riktar AML-direktiven dataskyddsansvaret till medlemsstaterna, trots att de ger få incitament för ett adekvat skydd av personuppgiftskydd. Vidare konstateras det att det råder osäkerhet om vilket ramverk för dataskydd en finansiell underrättelseenhet ska omfattas av, vilket leder till skillnader i dataskyddsåtaganden mellan EU:s medlemsstater när det gäller begäran om utbyte av information. Följaktligen har medlemsstaters finansiella underrättelseenhet tillgång till en stor mängd personuppgifter med få eller inga begränsningar.
Mot denna bakgrund konstateras att det finns flera risker för brott mot EU-stadgan eftersom medlemsstaterna måste navigera och efterleva de motstridiga skyldigheterna inom både AML-direktiven och integritetskyddsreglerna. Medlemsstaterna riskerar särskilt att bryta mot principerna om nödvändighet och proportionalitet enligt artikel 52(1) i EU-stadgan. Följaktigen kan bristande normkoherens leda till urholkning av EU-rättens principer om rätt till privatliv som fastställs i artiklarna 7 och 8 i EU-stadgan. Slutligen understryks de kommersiella rötterna som den inre marknaden grundas på. Det fastställs att skyddet för rätten till privatliv och dataskydd riskerar att undermineras när kommersiell rörlighet prioriteras före mänskliga rättigheter genom artikel 114 i EUF-fördraget. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9128991
- author
- Setthapirom, Wandee LU
- supervisor
- organization
- alternative title
- Balancing the EU's Anti-Money Laundering Obligations against its Fundamental Rights to Privacy
- course
- JAEM03 20231
- year
- 2023
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- AML Anti-money laundering and terrorist financing gdpr fintech Surveillance payment services customer due diligence privacy Data protection FIU financial intelligence units Directive 2015/849 Directive 2016/680 Directive 2018/1673 Directive 2016/679
- language
- English
- id
- 9128991
- date added to LUP
- 2023-06-26 10:40:22
- date last changed
- 2023-06-26 10:40:22
@misc{9128991,
abstract = {{The thesis explores the EU’s anti-money laundering framework’s compatibility with conditions required under privacy rights. It asks the question whether the anti-money laundering framework confers obligations to private entities and other actors not belonging to law enforcement in a way which risks violation to the fundamental rights to privacy and data protection. The thesis elucidates the significance of privacy rights in the EU as underpinned by the principles of privacy in the European Convention of Human Rights. Moreover, the thesis examines the lawful conditions for far-reaching data-processing. It clarifies that the cases of the Court of Justice of the European Union require, among other conditions, clear and precise rules to limit the extent of interference of the right to privacy and, a link to serious crimes, to process personal data in a far-reaching manner. Additionally, the thesis highlights the complementary role of the General Data Protection Regulation in support of privacy rules within the internal market.
It finds that the AML-directives rely on private entities for the detection, monitoring and reporting of all individuals using financial services while including few safeguards to limit the interference with the right to privacy. Instead, the AML-directives direct the responsibility of safeguarding data protection to the Member States, despite providing few incentives for the adequate protection of data privacy while fulfilling the AML-objectives. Furthermore, it is found that there is uncertainty regarding which data-protection framework a financial intelligence unit must be subject to, resulting in discrepancies in data-protection commitments during the request of exchange for information. Consequently, another Member State’s financial intelligence unit has access to a vast amount of personal data with little to no restriction. It therefore states that there are multiple risks of violation of the EU Charter as Member States are required to navigate and comply with the conflicting AML-obligations and the robust privacy rights.
Against this background, the thesis concludes that there are risks that Member States violate the principles of necessity and proportionality under Article 52(1) of the EU Charter due to the incoherency of norms. Lastly, the thesis reiterates the commercial roots upon which the internal market is established could lead to an overshadowed fundamental rights protection while prioritising commercial mobility using Article 114 TFEU. Consequently, such legal incoherency could erode the privacy rights established under Articles 7 and 8 of the EU Charter, overshadowing the fundamental right to privacy.}},
author = {{Setthapirom, Wandee}},
language = {{eng}},
note = {{Student Paper}},
title = {{Safeguarding Financial Integrity and Privacy in the EU's Internal Market: Balancing Anti-Money Laundering Obligations against Fundamental Rights to Privacy}},
year = {{2023}},
}