The Riigikogu passed the Act on Amendments to the Taxation Act, the Money Laundering and Terrorist Financing Prevention Act and the Code of Civil Procedure and the Code of Enforcement Procedure Implementation Act (924 SE), initiated by the Government of the Republic.
The Act clarifies the rights of the Tax and Customs Board and the Financial Intelligence Unit to receive information from third parties in order to check taxes and fulfil their duties in combating money laundering, with particular emphasis on bank accounts and account data. Under the Act, the Tax and Customs Board has the right to request information from credit institutions in tax proceedings, and this right also extends to bank secrecy.
The Act specifies and defines the information that the Tax and Customs Board may request through the information exchange channel of the enforcement register. When the Tax and Customs Board requests information through the enforcement register, the order must now include an explanation of the factual circumstances, including a justification as to why it has been impossible to obtain the necessary information from the taxable person. This will make information requests more transparent and help to limit unjustified interference with individual rights.
In justified cases, the Financial Intelligence Unit can obtain account information, including account balances and account statements, through the enforcement register. During the legislative proceedings, amendments were introduced into the Act to shorten the time limits for notifying of bank account statement requests. As a general rule, the account holder is notified of an inquiry into their data four years after receiving the bank account statement instead of the original five years, and in justified cases this period may be extended by up to two years beyond the original five-year period. The notification obligation applies to inquiries that are made after the Act enters into force.
The amendments made during the legislative proceedings also define the powers of the Financial Intelligence Unit and allow bank account statements to be requested only to the extent necessary for specific proceedings when it is not possible to obtain the necessary information by any other means. In addition, a clear basis is established for the Unit to process personal data, including special categories of personal data, as well as an obligation to comply with necessary security measures.
The amendments are based on the observations by the Chancellor of Justice that the regulation of the Tax and Customs Board’s access to the enforcement register outside criminal proceedings is open to interpretation in the current Act and that the right of the Financial Intelligence Unit to obtain bank account statements is not set out with sufficient clarity. In addition, the Act streamlines the regulation of the supervision by the Financial Intelligence Unit and improves the wording of the provisions in light of a recent interpretation by the Supreme Court and the need to make the regulation of anti-money laundering supervision more precise in terminology.
55 members of the Riigikogu voted in favour of passing the Act and 20 voted against.