Curbing self-regulation through new national supervisory authorities on anti-money laundering within the EU via national systems: a threat to the rule of law?

Money laundering and financing of terrorism still pose a serious threat to the integrity of the economy of the EU, its financial system and its citizens. According to Europol, around 1% of the EU’s annual GDP is involved in suspect financial activity. In order to tackle this ‘grand societal challenge’, in July 2021, the European Commission presented an ambitious package of four legislative proposals to strengthen the EU’s stance on anti-money laundering and countering the financing of terrorism. One major pillar concerns the supervision of obliged entities. In that regard, the Commission proposes to subject supervisory self-regulatory bodies, especially bar associations vis-à-vis lawyers, to oversight by national public authorities, because ‘the quality and intensity of supervision by such [bodies] has been insufficient, and under no or close to no public scrutiny’. However, this proposed tightening of supervision on lawyers as a result of a certain distrust of their self-regulation stands at odds with the view of self-regulation as a guarantee for an independent bar and independent lawyers, and therefore as an essential component of the rule of law. In bringing together multiple topics of this conference, this contribution aims to analyse the role of self-regulation of lawyers within the rule of law, and if and under what conditions restrictions are possible. Afterwards, it critically assesses the distrust of the profession in the field of AML/CFT and whether that warrants a restriction of its self-regulation as proposed by the Commission.