The European Insurance and Occupational Pensions Authority (EIOPA) has decided to supplement its Decision of 10 June 2021 on collaboration between supervisory authorities with a new annex dedicated to supervisory cooperation for when a (re)insurance undertaking relocates within the EU. The annex intends to facilitate an effective transition when undertakings move their registered office within the Single Market (i.e. cross-border conversion), applying the provision of the so called ‘Mobility Directive’ (Directive (EU) 2019/2121).
The supplement puts emphasis on active and early engagement between supervisors in the departure and destination countries. This proactive approach ensures that the relocating entity can continue to provide its services without interruption and under continuous, consistent and sound supervision. It promotes a structured transfer of supervisory information and knowledge regarding the relocating (re)insurance undertaking and aims to safeguard the interests of policyholders and beneficiaries throughout and after the transition.
EIOPA may provide supervisory authorities with technical assistance and expertise during the transition, particularly in complex cases or where specific guidance is required.
Background
The EU’s so-called ‘Mobility Directive’ strengthens the right of limited liability companies to convert, merge or divide across borders within the European Union, with an emphasis on the protection of interests of their employees, creditors and shareholders.
The provisions of the ‘Mobility Directive’ also apply to the cross-border conversions of insurance and reinsurance undertakings. To ensure its smooth implementation in the insurance sector and a smooth transition of supervisory duties in case of cross-border conversions, EIOPA agreed in its supervisory convergence plans for 2023 and 2024 to develop a supervisory tool to facilitate the cooperation between competent authorities in departure and destination countries.
Details
- Publication date
- 1 July 2024