Chapter 4: Free Movement of Capital

Free movement of capital represents the fourth fundamental freedom at the basis of the European Union foundation. It owns a crucial position in founding an open, integrated, competitive and effective financial market and financial service structure in Europe. Member States must remove, with some exceptions, all restrictions on movement of capital both within the EU and between Member States and third countries. The acquis under this chapter also includes rules concerning cross-border payments and; execution of transfer orders concerning securities. It also 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 in the framework of the fight against money laundering and terrorist financing. In this token, the creation of effective administrative and enforcement capacity, including co-operation between supervisory, law enforcement and prosecutorial authorities becomes key to combat financial crime.