NEGOTIATING CHAPTER
The requirements of EU policies in Chapter 3.04 Free movement of capital are aimed at removing, with some exceptions, all restrictions on movement of capital both within the EU and between Member States and third countries. Legislation in this area is based on the Treaty on the Functioning of the European Union, in particular Articles 63-66. Annex I to Directive 88/361/EEC provides definitions of different types of capital movements. The acquis also includes rules concerning cross-border payments and the execution of transfer orders concerning securities. The directive on the fight against money laundering and terrorist financing requires banks and other economic operators, particularly when dealing in high-value items and with large cash transactions, to identify customers and report certain transactions. A key requirement to combat financial crime is the creation of effective administrative and enforcement capacity, including co-operation between supervisory, law enforcement and prosecutorial authorities.