The EU Anti-Money Laundering Regulation: What Counterparty Due Diligence Will Look Like from July 2027

From 10 July 2027, the EU’s Anti-Money Laundering Regulation 2024/1624 (AMLR) will apply directly in all 27 member states. For the first time, the core rules on customer due diligence will be the same across the EU, rather than being 27 national versions of a directive.

This blog looks at who is in scope, what the AMLR requires and how your approvals and disclosures process can help you prepare, whether you are an obliged entity yourself or a counterparty of one.

Who’s In Scope for the EU Anti-Money Laundering Regulation

The AMLR applies directly to “obliged entities”. These include:

• banks, other financial institutions and insurers;
• auditors, accountants, tax advisers and lawyers and notaries for certain transactions; and
• newly added sectors such as crypto-asset service providers, crowdfunding platforms and traders in high value goods.

Many organisations that are not obliged entities will still feel the impact. Banks and other obliged entities will apply the AMLR’s standards to you as their customer and those standards are fast becoming the benchmark for third party due diligence under ABAC and fraud prevention regimes too. The AMLR also introduces an EU-wide limit of €10,000 on cash payments for goods and services.

What the AMLR Requires

The AMLR sets out a single EU rulebook for customer due diligence, including:

1. Identifying and verifying customers and their beneficial owners
2. Treating anyone holding 25% or more of the shares or voting rights, or exercising control by other means, as a beneficial owner
3. Understanding the purpose and intended nature of the business relationship
4. Ongoing monitoring, with checks calibrated to risk
5. Enhanced due diligence for PEPs, their family members and close associates
6. Enhanced due diligence for business involving high risk third countries

The EU’s new Anti-Money Laundering Authority (AMLA), operational since July 2025, is finalising the detailed technical standards on customer due diligence following a public consultation which closed in May 2026. AMLA will also directly supervise a small number of the highest risk cross-border financial institutions. Penalties for serious breaches are rising too, to up to €10 million or 10% of annual turnover for financial institutions.

Managing Third Parties Effectively

Counterparty due diligence is not a one-time check at onboarding. The AMLR expects it to run throughout the relationship. Your approval process is where much of this evidence is created.

Recording the purpose of each new third party relationship at the point of request helps meet the AMLR’s expectation that you understand why the relationship exists. It also gives you a baseline against which to spot activity that may not comply.

Make informed, risk-based decisions before engaging with third parties. Automate ongoing third-party monitoring to identify real-time shifts in sanctions, PEP exposure, and adverse media risk, centralise screening findings and supporting documentation and use configurable risk scoring to assess each third party against your organisation's risk criteria. With structured review and approval workflows and a clear audit trail (like those in Case IQ's third-party management platform), decision-makers can evaluate potential risks, document their decisions and demonstrate that due diligence was completed before approval.

Capturing ownership information as part of the request and flagging where an owner, director or connected person is also an employee or related party, helps you see who really stands behind a counterparty.

Routing higher risk requests, such as those involving PEPs or high risk third countries, to extra approvers demonstrates that enhanced due diligence was applied where it mattered.

Re-screening approved third parties at regular intervals and recording changes in ownership or risk rating provides evidence of ongoing monitoring. These records provide a key evidence trail if questions are asked.

Five Practical Tips for Organisations Preparing for the AMLR

1. Confirm whether any entity in your group is, or will become, an obliged entity under the AMLR.
2. Review your beneficial ownership checks against the new “25% or more” threshold and control by other means.
3. Make sure screening runs before approval and that the result is stored with the decision.
4. Define what triggers enhanced due diligence, such as PEP links or high risk third countries, and route those requests accordingly.
5. Set re-screening intervals by risk level and keep a record that they ran.

How Case IQ Can Help

Case IQ's Third-Party Management solution streamlines third-party onboarding and due diligence through configurable, risk-based workflows. Automatically risk-score third parties using configurable scoring criteria and automate onboarding, approvals and monitoring. Centralise screening results, supporting documentation and approval decisions in an auditable record, so your organisation can demonstrate that third-party risks were evaluated and due diligence was completed before approval.

‍

Important: This post is for informational and educational purposes only. This post should not be taken as legal advice or used as a substitute for such. You should always speak to your own lawyer.

Frequently Asked Questions

1. What is the EU Anti-Money Laundering Regulation (AMLR)?

The EU Anti-Money Laundering Regulation (EU) 2024/1624 establishes a single set of anti-money laundering and counter-terrorist financing rules across all 27 EU member states. It harmonizes customer due diligence requirements, beneficial ownership verification, and ongoing monitoring obligations, replacing differing national approaches with a more consistent regulatory framework.

2. When does the EU Anti-Money Laundering Regulation take effect?

The EU AMLR will generally apply from July 10, 2027, across all 27 EU member states. Unlike a directive, the regulation applies directly without requiring each country to transpose its core provisions into national law. Organizations should review their customer and counterparty due diligence processes ahead of the deadline to identify potential compliance gaps.

3. Which organizations must comply with the EU AMLR?

The AMLR applies to designated obliged entities, including banks, financial institutions, certain insurers, accountants, auditors, and legal professionals conducting specified transactions. It also extends to sectors such as crypto-asset service providers and certain high-value goods traders. Organizations outside its direct scope may still face increased due diligence requests from banks and other regulated business partners.

4. What are the beneficial ownership requirements under the EU AMLR?

The AMLR requires obliged entities to identify and verify the beneficial owners of their customers. This includes individuals who directly or indirectly own 25% or more of shares or voting rights, as well as individuals exercising control through other means. Organizations should ensure their due diligence processes capture relevant ownership and control information, including complex corporate structures.

5. Does the EU AMLR require ongoing third-party due diligence?

Yes. For obliged entities, customer due diligence extends beyond initial onboarding. The AMLR requires ongoing monitoring of business relationships, with the frequency and depth of checks determined by risk. This can include reviewing changes in beneficial ownership, updating customer information, and reassessing risk when circumstances change. Automated screening and documented reviews can help organizations maintain effective oversight.

6. What is enhanced due diligence under the EU AMLR?

Enhanced due diligence involves additional verification and monitoring measures for higher-risk relationships or transactions. Under the AMLR, this includes certain relationships involving politically exposed persons (PEPs), their family members and close associates, and high-risk third countries. Organizations should establish clear escalation procedures and document the additional checks performed before approving higher-risk relationships.

7. How can approvals and disclosures processes support AMLR compliance?

Structured approvals and disclosures processes can help organizations document the purpose of business relationships, capture ownership information, conduct risk screening, and maintain records of compliance decisions. By integrating these activities into approval workflows, compliance teams can demonstrate that relevant due diligence was completed before a relationship was approved and that higher-risk requests received appropriate scrutiny.

8. How can Case IQ help organizations prepare for the EU AMLR?

Case IQ's Quantum Approvals & Disclosures solution helps organizations manage third-party requests through structured approval workflows, integrated screening, and documented decision-making. By centralizing approvals and supporting risk-based reviews, Case IQ helps compliance teams improve visibility into counterparty risks and maintain the evidence needed to demonstrate effective due diligence. Organizations can also use Case IQ's Third-Party Management capabilities to support ongoing screening and risk oversight throughout the business relationship.