Business Relationship
A business relationship under MLR 2017 Regulation 4 is a relationship between a regulated firm and a client that has, or is expected to have, an element of duration. Acceptance of a client into a business relationship triggers the full set of CDD obligations under Regulation 28, including identity verification, beneficial-ownership identification, and ongoing monitoring throughout the life of the engagement.
virtually every retained accountancy client constitutes a business relationship — annual tax returns, monthly bookkeeping, ongoing payroll. Short one-off services for non-recurring clients may instead fall under the 'occasional transaction' rules if below threshold, but most firms apply full CDD regardless.
Other terms that go with Business Relationship
An occasional transaction under MLR 2017 Regulation 27 is a single transaction (or a series of linked transactions that appear to be a single operation) carried out outside an established business relationship. CDD is triggered when an occasional transaction reaches €15,000 — or any lower threshold the firm sets in its own risk-based policies.
Customer Due Diligence is the core legal obligation under MLR 2017 to identify clients, verify their identity using reliable independent sources, and understand the purpose and intended nature of the business relationship. Standard CDD applies to most clients. Where risk is elevated, Enhanced Due Diligence (EDD) is required instead.
Ongoing monitoring is the continuous obligation to scrutinise transactions and client activity throughout a business relationship and to keep CDD records up to date. It requires watching for transactions or behaviour that is inconsistent with the stated purpose of the relationship or the expected risk profile.
Put Business Relationship into practice with Certivus
Knowing the term is the first step. Certivus gives you the workflows — client intake, CDD, EDD, PEP and sanctions screening, audit-ready records — to apply it across every client.
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