This is no mere update, but a fundamental shift in the European approach. The most striking change is that the AMLR, as a regulation, will have direct effect in all Member States, making national implementation redundant. Even so, the Netherlands will introduce new rules to implement Directive (EU) 2024/1640 (AMLD6) and further embed the AMLR into Dutch law.
The AMLR forms part of an ambitious European package, which also establishes the Anti-Money Laundering Authority (AMLA). This new European watchdog will issue detailed guidance on a range of topics: from indicators for suspicious activity or criminal conduct and the minimum standard for business-wide risk assessment, to guidelines for the risk variables and risk factors that entities must take into account when entering into business relationships or carrying out occasional transactions. The impact on sectors previously relatively untouched, including the luxury sector, is considerable. Traders in 'high-value goods' may soon find themselves subject to obligations and responsibilities under the AMLR, once reserved for the financial sector’s traditional gatekeepers.
A recent judgement of the Amsterdam Court of Appeal of 21 August 2025 is particularly illustrative. The court acquitted a salesperson at a renowned Amsterdam jeweller of money laundering, despite jewellery and watches worth over half a million euros being purchased with criminal proceeds. This case offers a lens through which to examine (part of) the changes the AMLR will bring. The question arises: Would the Court’s decision have differed had the AMLR already been in force? We believe the answer highlights the need for the luxury sector to critically assess and thoroughly prepare for the new regulatory landscape.
Amsterdam Court of Appeal judgement of 21 August 2025 - Luxury watches and suspicious transactions?
The defendant, a sales employee at a luxury jeweller, sold, among other things, high value watches and jewellery over the course of a year. It was ultimately undisputed that the money with which these purchases were made originated from crime. The key question was whether the defendant should reasonably have suspected this.
The Public Prosecution Service argued yes, because:
- the defendant recorded different company names on invoices instead of the name of the actual purchaser,
- conversation history showed that the defendant said that the customer was "dodgy" and that he "didn't know where she got the money from", and
- no investigation into the origin of the funds had been conducted by the defendant.
However, the Court of Appeal acquitted the defendant. The reasoning is telling and illustrates the current limits of the application of the Anti-Money Laundering and Anti-Terrorist Financing Act (Wwft) in the luxury sector. The statutory obligation to conduct customer due diligence under the Wwft did not apply, as payments in question were made by bank transfer. The defendant worked for a large company with a separate finance department, and the Court of Appeal ruled that the responsibility therefore had to be shared. Furthermore, the Court of Appeal concluded that it is not uncommon in the sector for invoices to be made out to bear names other than purchasers. The defendant's remark about the customer being "dodgy" did not, in itself, prove knowledge of criminal origins. The Court noted that those dealing with wealthy clients often wonder about the source of their funds.
The Judgement under the AMLR
The facts of the judgement viewed through the prism of the AMLR, it becomes clear that the outcome could well have been different. After all, the AMLR imposes far greater obligations on (staff in) the luxury sector.
High-value goods: The EUR 10,000 threshold
With purchases totalling over half a million euros, these transactions would – in all likelihood at least part –qualify as ‘high-value goods’ under the AMLR. Jewellery, gold and silversmith products, clocks and watches worth more than EUR 10,000 fall within this category. Under the AMLR, the jeweller qualifies as an 'obliged entity', a term replacing 'institution' under the Wwft. As said, the Court of Appeal ruled that the legal obligation to conduct customer due diligence under the Wwft did not apply, as the payments were made by bank transfer. However, under the AMLR, the jeweller should have conducted customer due diligence, considering the amounts involved. Payments by bank transfer no longer exempts one from customer due diligence. In this case, the jeweller would have been required to conduct such checks. The red flags, including multiple company names, the "dodgy" quote and the absence of any investigation into the origin of the funds – elements that the Court of Appeal now considered insufficient to meet the threshold 'should reasonably have suspected' – would have carried much more weight. The current ‘Wwft Guidelines for Buyers and Sellers of Goods’ underline this point even further.
These guidelines highlight several risk factors that trigger enhanced customer due diligence, in case the Wwft is applicable, such as:
- Person other than the purchaser providing their identity for the transaction.
- Purchasing the goods in another person’s name.
- Requesting that invoices be made out in a different name or to a different address.
- Dealing in items that are especially attractive to criminals or their associates, such as high-end watches.
The new supervisory authority, AMLA, has yet to clarify which risk variables and risk factors will matter most when obliged entities start or maintain business relationships, or process transactions. Once published, the AMLA guidelines will effectively replace the national guidelines, setting the standard on how to comply with European legislation. These guidelines, while not legally binding like the AMLR itself, will have a quasi-normative effect, influencing enforcement. For the luxury sector, the question is how detailed and specific these AMLA guidelines will be, and which signals or conduct will be designated as risk factors therein. The first set of guidelines is expected to land in 2026.
It is worth mentioning that the AMLR sets an EU-wide cap of EUR 10,000 for cash payments in the purchase or sale of goods and services. However, individual Member States are free to impose tougher restrictions. The Netherlands, for example, is lowering its own limit to EUR 3,000. A key concern remains the practice of 'structuring' or 'smurfing', where transactions are split up to stay under the reporting thresholds. In these cases, multiple transactions that are connected must be regarded as one transaction.
From unusual to suspicious transactions
The AMLR shifts the reporting requirement from 'unusual’ to ‘suspicious’ transactions. This difference is not merely semantic. Obliged entities must report under the AMLR when they know, suspect or reasonably should suspect that funds or activities, regardless of the amount, are proceeds of criminal activities or are connected to terrorist financing or criminal activities. The impact on current reporting will be clearer once the AMLA guidelines are published.
Furthermore, the AMLR stipulates that obliged entities may not enter into a business relationship or carry out a transaction when they are unable to comply with the customer due diligence measures. In the present case, where different company names were placed on invoices and no investigation into the origin of the funds took place, this provision might have forced the salesperson to refuse the transaction or to conduct adequate (enhanced) customer due diligence after all.
Shared responsibility?
The Court of Appeal ruled that the defendant's responsibility to be alert to possible transactions with illegal money had to be shared with the company where he was employed, partly due to the size of the company which also had a separate finance department. This argument put forward by the defence might be less effective under the AMLR. After all, the regulation establishes, in addition to extensive requirements for the governance of obliged entities, supplementary requirements for the integrity and knowledge of individual employees.
The AMLR stipulates that obliged entities ensure their employees have the appropriate knowledge, skills and expertise necessary for compliance with anti-money laundering regulations. In addition, companies must implement procedures to uphold employee integrity, including conducting screening upon recruitment and during employment.
"Under this regime, the individual accountability of salespersons in the context of anti-money laundering obligations is more clearly defined, making it less likely that claims of shared responsibility will be accepted", Simone Honig, partner Corporate Crime & Investigations.
Conclusion
Recent headlines "Louis Vuitton must fear lawsuit in Dutch money laundering case", "How a perfume trader became part of a criminal money laundering network", "Diamond seller Jacco was just doing his job, yet the Public Prosecution Service suspected him of money laundering", speak volumes. Following the storm of criminal investigations into compliance with the Wwft by companies in the financial sector, the luxury sector is now firmly in the sights of prosecutors and regulators.
The AMLR supports this and goes further than the current regulatory framework. With the AMLR entering into force on 10 July 2027, the days of bank transfers providing a potential loophole are numbered and the playing field will fundamentally shift. The key question remains how this new regime will crystallise in practice. One thing is clear: the luxury sector must brace itself for a fundamentally different reality. Whereas banks and other financial institutions have long invested in extensive compliance programmes, jewellers, watch dealers and other luxury retailers will now have to do the same if they wish to pass the test in an enforcement-proof manner.
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Do you have questions about these new standards and the consequences for (the implementation in) your business? Please feel free to contact us.
