Cash payments: Limits set by anti money-laundering Law

In the current economic climate, suppliers ask to be paid in cash more and more often. Also, certain credit insurers are tightening their limits of coverage using even tougher solvency criteria , consequently stimulating the demand for payment in cash by the suppliers (c.f. De Tijd, 14 August 2009). In these circumstances, it is pertinent to draw attention to the rules related to cash payments maintained by anti money-laundering legislation.

The anti money-laundering Law of 11 January 1993 [1] is mainly recognised for the mandatory level of transparency, linked to the prevention and detection of money-laundering, that is required from certain categories of professionals (a limited list).

Generally, it is less known that this law also sets certain limits to cash payments, which apply to all commercial entities and their customers.

Effectively, Article 10ter of the anti money-laundering Law provides that “the sale price of an item by a commercial entity for which the value equals or exceeds EUR 15,000 cannot be paid for in cash” [2].

Failure to uphold this disposition could result in a fine ranging from EUR 1,375 to EUR 1,237,500. However, this fine may not exceed 10% of the total amount unduly paid in cash. A similar penalty can also be imposed upon persons that impede the criminal investigations aimed at establishing evidence linking to Article 10ter [3].

In addition to the penalty incurred through the anti money-laundering Law, the payment itself could be qualified as a money-laundering offence and therefore subject to criminal prosecution.