Following a public consultation launched in June 2023, on 4 June 2024 the Italian insurance supervisory authority (“IVASS”) published its Measure no. 144/2024 (the “Measure”) providing amendments and integrations to IVASS Regulation no. 44/2019 laying down implementing provisions aimed at preventing the use of insurance undertakings and insurance intermediaries for the purposes of money laundering and terrorist financing as regards organisation, procedures and internal controls and customer due diligence (“AML Regulation”).

The Measure is aimed at aligning national legislation with the EBA Guidelines on policies and procedures in relation to compliance management and the role and responsibilities of the AML/CFT compliance officer under Article 8 and Chapter VI of Directive (EU) 2015/849, published in June 2022 (EBA/GL/2022/05) (the “EBA Guidelines”). 

As for the scope of application in the insurance sector, the EBA Guidelines concern Italian insurance undertakings as well as Italian branches of insurance undertakings and intermediaries with head office in a EU/EEA Member State or in a third country. Nonetheless, the AML Regulation also applies in part to life EU/EEA insurance undertakings and intermediaries operating in Italy under freedom of services regime but to be considered as "established in Italy without a branch" as per IVASS Measure no. 111/2021.

The most significant changes brought by the Measure concern the following:

• Identification of a director responsible for AML: the Measure introduces the obligation for insurance undertakings as well as Italian insurance brokers and agents to appoint a member of their board of directors as director responsible for AML, without prejudice to the collective responsibility of the same body. The director responsible for AML constitutes the main point of contact between the holder of the AML function, the  body with management function (for which a specific definition has been introduced) and ensures that the latter have the necessary information to fully understand the significance of the money laundering risks to which the abovementioned obliged entities are exposed, for the purpose of the exercise of their respective powers. The director responsible for AML shall meet specific eligibility requirements to hold the office and has specific tasks listed by the Measure, including informing corporate bodies of violations and critical issues concerning money laundering of which he/she has become aware and recommending appropriate action. The director responsible for AML shall be appointed at the first renewal of the corporate bodies following the entry into force of the Measure and in any case no later than 30 June 2026.

• AML function: the rules contained in the AML Regulation were already largely aligned with the EBA Guidelines with regard to the role and duties of the AML function holder. The necessary interventions concerned the regulation of the relationship between the AML function holder and the director responsible for AML referred to above. In addition, the Measure introduced an obligation to consult the AML function in cases where the opening or continuation of an ongoing relationship with a high-risk client is subject by law to the approval of a senior manager. Under certain conditions, the director responsible for AML may be appointed as holder of the AML function. Moreover, the Measure introduced the obligation to identify a substitute for the AML function holder for cases of the latter's absence or doubts as to his/her integrity.

• Outsourcing: in line with the EBA Guidelines, it has been expressly clarified that outsourcing may only concern the tasks of the AML function; while liability of the function cannot be outsourced. Thus, an AML function holder shall be appointed also in the event of outsourcing, in charge of monitoring and controlling the outsourced activities.

• Groups: the EBA Guidelines broaden the scope and detail the content of organisational requirements at group level. The AML Regulation was consequently amended to include:

  • the identification of a director responsible for group AML (from among the members of the body with management function of the ultimate Italian parent company);

  • the designation of a holder of the group AML function and the indication of the tasks thereof, which include coordination between the AML functions of the individual group companies, the drafting of a group-wide risk self-assessment and the submission of an annual report to the bodies of the ultimate Italian parent company, the development of group-wide procedures, standards and methodologies;

  • the definition of group-wide control procedures.

• Eligibility requirements: following the issuance of IVASS Measure no. 142/2024 - which implemented at secondary level of legislation the Decree of the Ministry of Economic Development no. 88/2022 setting out the requirements and eligibility criteria for corporate officers and those performing key functions of insurance and reinsurance undertakings - the Measure also provided the consequent, necessary amendments regarding the eligibility requirements for corporate officers and the holder of the AML function, as well as the person responsible for reporting suspicious transactions, if this is a different person.

Next steps

The Measure was published on the Italian Official Gazette on 14 June 2024 and entered into force the following day.

As said above, the director responsible for AML shall be appointed at the first renewal of the corporate bodies following the entry into force of the Measure and in any case no later than 30 June 2026.