The Solvency ii
Directive
SECTION 3 – PUBLIC DISCLOSURE
Article 50
Report on solvency and financial condition: contents
1. Member States shall, taking into account the principles set out
in paragraphs 3 and 4 of Article 35, require insurance and
reinsurance undertakings to publicly
disclose, on an annual basis, a report on their solvency and
financial condition.
That report shall contain the following
information, either in full or by way of references to
equivalent information, both in nature and scope, disclosed
publicly under other legal or regulatory requirements:
(a) a description of the business and the performance of the
undertaking;
(b) a description of the system of governance and an assessment of
its adequacy for the risk profile of the undertaking;
(c) a description, separately for each
category of risk, of the risk exposure, concentration, mitigation
and sensitivity;
(d) a description, separately for assets, technical provisions,
and other liabilities, of the bases and methods used for their
valuation, together with an explanation of any major differences
in the bases and methods used for their valuation in financial
statements;
(e) a description of the capital management, including at least
the following:
(i) the structure and amount of own funds, and their quality;
(ii) the amounts of the Minimum Capital
Requirement and of the Solvency Capital Requirement;
(iia) the option set out in Article 305b used for the calculation
of the Solvency Capital Requirement;
(iii) information allowing a proper understanding of the main
differences between the underlying assumptions of the standard
formula and those of any internal model used by the undertaking
for the calculation of its Solvency Capital Requirement;
(iv) the amount of any non-compliance
with the Minimum Capital Requirement or any significant
non-compliance with the Solvency Capital Requirement during the
reporting period, even if subsequently resolved, with an
explanation of its origin and consequences as well as any remedial
measures taken.
2. The description referred to in point (e)(i) of paragraph 1
shall include an analysis of any significant
changes as compared to the previous reporting period and an
explanation of any major differences in relation to the value of
such elements in financial statements, and a brief description of
the capital transferability.
The disclosure of the Solvency Capital Requirement referred to in
point (e)(ii) of paragraph 1 shall show separately the amount
calculated in accordance with Chapter VI, Section 4, Subsections 2
and 3 and any capital add-on imposed in accordance with Article 37
or the impact of the specific parameters the insurance or
reinsurance undertaking is required to use in accordance with
Article 108a, together with concise information on its
justification by the supervisory authority concerned.
However, and without prejudice to any disclosure mandatory under
any other legal or regulatory requirements, Member States may
provide that, although the total Solvency Capital Requirement
referred to in point (e)(ii) of paragraph 1 is disclosed, the
capital add-on or the impact of the specific parameters the
insurance or reinsurance undertaking is required to use in
accordance with Article 108a need not be separately disclosed
during a transitional period not exceeding five years after the
date referred to in Article 310.
The disclosure of the Solvency Capital
Requirement shall be accompanied, where applicable, by an
indication that its final amount is still subject to supervisory
assessment.
Article 51
Information for and reports by the CEIOPS
1.
Member States shall require the supervisory authorities to
provide the following information to the CEIOPS on an annual
basis:
(a) the average capital add-on per undertaking and
the distribution of capital add-ons imposed by the supervisory
authority during the previous year, measured as a percentage of
the Solvency Capital Requirement, shown separately as follows:
(i) for all insurance and reinsurance undertakings together;
(ii) for life insurance undertakings;
(iii) for
non-life insurance undertakings;
(iiia) for insurance
undertakings carrying on both life and non-life activities;
(iiib) for reinsurance undertakings;
(b) for each of
the disclosures set out in point (a), the proportion of capital
add-ons imposed under points (a), (b) and (c) of Article 37(1)
respectively.
2. The CEIOPS shall publicly disclose, on
an annual basis, the following information:
(a) for all
Member States together, the total distribution of capital
add-ons, measured as a percentage of the Solvency Capital
Requirement, for each of the following:
(i) all insurance
and reinsurance undertakings;
(ii) life insurance
undertakings;
(iii) non-life insurance undertakings;
(iiia) insurance undertakings carrying on both life and
non-life activities;
(iiib) reinsurance undertakings;
(b) for each Member State separately, the distribution of
capital add-ons, measured as a percentage of the Solvency
Capital Requirement, covering all insurance and reinsurance
undertakings in that Member State;
(ba) for each of the
disclosures referred to in points (a) and (b), the proportion of
capital add-ons imposed under points (a), (b) and (c) of Article
37(1) respectively.
3. The CEIOPS shall provide the
information referred to in paragraph 2 to the European
Parliament, the Council and the Commission, together with a
report outlining the degree of supervisory convergence in the
use of capital add-ons between supervisory authorities in the
different Member States.
Article 52
Report on solvency and financial condition:
applicable principles
1. Supervisory authorities
shall permit insurance and reinsurance undertakings not to
disclose information in the following cases:
(a) if, by
disclosing such information, the competitors of the undertaking
gain significant undue advantage;
(b) if there are
obligations to policyholders or other counterparty relationships
binding an undertaking to secrecy or confidentiality.
2.
Where non-disclosure of information is permitted by the
supervisory authority, undertakings shall state this in the
report on solvency and financial condition and explain the
reasons.
3. Supervisory authorities shall permit
insurance and reinsurance undertakings, to make use of – or
refer to – public disclosures made under other legal or
regulatory requirements, to the extent that those disclosures
are equivalent to the information required under Article 50 in
both their nature and scope.
4. Paragraphs 1 and 2 shall
not apply to the information referred to in point (e) of Article
50(1).
Article 53
Report on
solvency and financial condition: updates and additional
voluntary information
1. In the event of any major
development affecting significantly the relevance of the
information disclosed in accordance with Articles 50 and 52,
insurance and reinsurance undertakings shall disclose
appropriate information on its nature and effects.
For
the purposes of the first subparagraph, at least the following
shall be regarded as major developments:
(a) where
non-compliance with the Minimum Capital Requirement is observed
and the supervisory authorities either consider that the
undertaking will not be able to submit a realistic short-term
finance scheme or do not obtain such a scheme within one month;
(b) where a significant non-compliance with the Solvency
Capital Requirement is observed and the supervisory authorities
do not obtain a realistic recovery plan within two months.
In the cases referred to in point (a) of the second
subparagraph, the supervisory authorities shall require the
undertaking concerned to disclose immediately the amount of the
non-compliance, together with an explanation of its origin and
consequences, including any remedial measure taken. Where, in
spite of a short-term finance scheme initially considered to be
realistic, a non-compliance with the Minimum Capital Requirement
has not been resolved three months after its observation, it
shall be disclosed at the end of that period, together with an
explanation of its origin and consequences, including any
remedial measures taken as well as any further remedial measures
planned.
In the case referred to in point (b) of the
second subparagraph, the supervisory authorities shall require
the undertaking concerned to disclose immediately the amount of
the non-compliance, together with an explanation of its origin
and consequences, including any remedial measure taken. Where,
in spite of the recovery plan initially considered to be
realistic, a significant non-compliance with the Solvency
Capital Requirement has not been resolved six months after its
observation, it shall be disclosed at the end of that period,
together with an explanation of its origin and consequences,
including any remedial measures taken as well as any further
remedial measures planned.
2. Insurance and reinsurance
undertakings may disclose, on a voluntary basis, any information
or explanation related to their solvency and financial condition
which is not already required to be disclosed in accordance with
Articles 50 and 52 and paragraph 1 of this Article.
Article 54
Report on solvency and
financial condition: policy and approval
1. Member
States shall require insurance and reinsurance undertakings to
have appropriate systems and structures in place to fulfil the
requirements laid down in Articles 50, 52 and 53(1), as well as
to have a written policy ensuring the on-going appropriateness
of any information disclosed in accordance with Articles 50, 52
and 53.
2. The solvency and financial condition report
shall be subject to approval by the administrative or management
body of the insurance or reinsurance undertaking and be
published only after that approval.
Article 55
Solvency and financial
condition report: implementing measures
The
Commission shall adopt implementing measures further specifying
the information which must be disclosed and the means by which
this is to be achieved.
Those measures designed to amend
non-essential elements of this Directive, by supplementing it,
shall be adopted in accordance with the regulatory procedure
with scrutiny referred to in Article 304(3).
SECTION 4 - QUALIFYING HOLDINGS
Article 56
Acquisitions
1. Member States
shall require any natural or legal person or such persons acting
in concert (hereinafter referred to as the proposed acquirer),
who have taken a decision either to acquire, directly or
indirectly, a qualifying holding in an insurance or reinsurance
undertaking or to further increase, directly or indirectly, such
a qualifying holding in an insurance or reinsurance undertaking
as a result of which the proportion of the voting rights or of
the capital held would reach or exceed 20 %, 30 % or 50 % or so
that the insurance or reinsurance undertaking would become its
subsidiary (hereinafter referred to as the proposed
acquisition), first to notify in writing the supervisory
authorities of the insurance or reinsurance undertaking in which
they are seeking to acquire or increase a qualifying holding,
indicating the size of the intended holding and relevant
information, as referred to in Article 58(4). Member States need
not apply the 30 % threshold where, in accordance with Article
9(3)(a) of Directive 2004/109/EC, they apply a threshold of
one-third.
2. Member States shall require any natural or
legal person who has taken a decision to dispose, directly or
indirectly, of a qualifying holding in an insurance or
reinsurance undertaking first to notify in writing the
supervisory authorities of the home Member State, indicating the
size of his intended holding. Such a person shall likewise
notify the supervisory authorities if he has taken a decision to
reduce his qualifying holding so that the proportion of the
voting rights or of the capital held would fall below 20 %, 30 %
or 50 % or so that the insurance or reinsurance undertaking
would cease to be his subsidiary. Member States need not apply
the 30 % threshold where, in accordance with Article 9(3)(a) of
Directive 2004/109/EC, they apply a threshold of one-third.
Article 57
Assessment period
1. The supervisory authorities shall, promptly and in any
event within two working days following receipt of the
notification required under Article 56(1), as well as following
the possible subsequent receipt of the information referred to
in paragraph 2, acknowledge receipt thereof in writing to the
proposed acquirer.
The supervisory authorities shall have
a maximum of 60 working days as from the date of the written
acknowledgement of receipt of the notification and all documents
required by the Member State to be attached to the notification
on the basis of the list referred to in Article 58 (4)
(hereinafter referred to as the assessment period), to carry out
the assessment provided for in Article 58 (1) (hereinafter
referred to as the assessment).
The supervisory
authorities shall inform the proposed acquirer of the date of
the expiry of the assessment period at the time of acknowledging
receipt.
2. The supervisory authorities may, during the
assessment period, if necessary, and no later than on the 50th
working day of the assessment period, request any further
information that is necessary to complete the assessment. Such
request shall be made in writing and shall specify the
additional information needed.
For the period between the
date of request for information by the supervisory authorities
and the receipt of a response thereto by the proposed acquirer,
the assessment period shall be interrupted. The interruption
shall not exceed 20 working days. Any further requests by the
supervisory authorities for completion or clarification of the
information shall be at their discretion but may not result in
an interruption of the assessment period.
3. The
supervisory authorities may extend the interruption referred to
in the second subparagraph of paragraph 2 up to 30 working days
if the proposed acquirer is:
(a) situated or regulated
outside the Community; or
(b) a natural or legal person
not subject to supervision under this Directive or Council
Directive 85/611/EEC of 20 December 1985 on the coordination of
laws, regulations and administrative provisions relating to
undertakings for collective investment in transferable
securities (UCITS) or Directives 2004/39/EC or 2006/48/EC.
4. If the supervisory authorities, upon completion of the
assessment, decide to oppose the proposed acquisition, they
shall, within two working days, and not exceeding the assessment
period, inform the proposed acquirer in writing and provide the
reasons for that decision. Subject to national law, an
appropriate statement of the reasons for the decision may be
made accessible to the public at the request of the proposed
acquirer. This shall not prevent a Member State from allowing
the supervisory authority to make such disclosure in the absence
of a request by the proposed acquirer.
5. If the
supervisory authorities do not oppose the proposed acquisition
within the assessment period in writing, it shall be deemed to
be approved.
6. The supervisory authorities may fix a
maximum period for concluding the proposed acquisition and
extend it where appropriate.
7. Member States may not
impose requirements for the notification to and approval by the
supervisory authorities of direct or indirect acquisitions of
voting rights or capital that are more stringent than those set
out in this Directive.
8. The Commission shall adopt
implementing measures further specifying the adjustments of the
criteria set out in Article 58 (1), in order to take account of
future developments and to ensure the uniform application of
Articles 56 to 62.
Those measures designed to amend
non-essential elements of this Directive by supplementing it,
shall be adopted in accordance with the regulatory procedure
with scrutiny referred to in Article 304(3).
Article 58
Assessment
1. In assessing the notification provided for in Article
56(1) and the information referred to in Article 57(2) the
supervisory authorities shall, in order to ensure the sound and
prudent management of the insurance or reinsurance undertaking
in which an acquisition is proposed, and having regard to the
likely influence of the proposed acquirer on the insurance or
reinsurance undertaking, appraise the suitability of the
proposed acquirer and the financial soundness of the proposed
acquisition against all of the following criteria:
(a)
the reputation of the proposed acquirer;
(b) the
reputation and experience of any person who will direct the
business of the insurance or reinsurance undertaking as a result
of the proposed acquisition;
(c) the financial soundness
of the proposed acquirer, in particular in relation to the type
of business pursued and envisaged in the insurance or
reinsurance undertaking in which the acquisition is proposed;
(d) whether the insurance or reinsurance undertaking will be
able to comply and continue to comply with the prudential
requirements based on this Directive and, where applicable,
other Directives, notably, Directive 2002/87/EC, in particular,
whether the group of which it will become a part has a structure
that makes it possible to exercise effective supervision,
effectively exchange information among the supervisory
authorities and determine the allocation of responsibilities
among the supervisory authorities;
(e) whether there are
reasonable grounds to suspect that, in connection with the
proposed acquisition, money laundering or terrorist financing
within the meaning of Article 1 of Directive 2005/60/EC is being
or has been committed or attempted, or that the proposed
acquisition could increase the risk thereof.
2. The
supervisory authorities may oppose the proposed acquisition only
if there are reasonable grounds for doing so on the basis of the
criteria set out in paragraph 1 or if the information provided
by the proposed acquirer is incomplete.
3. Member States
shall neither impose any prior conditions in respect of the
level of holding that must be acquired nor allow their
supervisory authorities to examine the proposed acquisition in
terms of the economic needs of the market.
4. Member
States shall make publicly available a list specifying the
information that is necessary to carry out the assessment and
that must be provided to the supervisory authorities at the time
of notification referred to in Article 56(1). The information
required shall be proportionate and adapted to the nature of the
proposed acquirer and the proposed acquisition. Member States
shall not require information that is not relevant for a
prudential assessment.
5. Notwithstanding Article 57 (1),
(2) and (3), where two or more proposals to acquire or increase
qualifying holdings in the same insurance or reinsurance
undertaking have been notified to the supervisory authority, the
latter shall treat the proposed acquirers in a
non-discriminatory manner.
Article 59
Acquisitions by regulated financial undertakings
1. The relevant supervisory authorities shall work in full
consultation with each other when carrying out the assessment if
the proposed acquirer is one of the following:
(a) a
credit institution, insurance or reinsurance undertaking,
investment firm or management company within the meaning of
Article 1a, point 2 of Directive 85/611/EEC (hereinafter
referred to as the "UCITS management company") authorised in
another Member State or in a sector other than that in which the
acquisition is proposed;
(b) the parent undertaking of a
credit institution, insurance or reinsurance undertaking,
investment firm or UCITS management company authorised in
another Member State or in a sector other than that in which the
acquisition is proposed; or
(c) a natural or legal person
controlling a credit institution, insurance or reinsurance
undertaking, investment firm or UCITS management company
authorised in another Member State or in a sector other than
that in which the acquisition is proposed.
2. The
supervisory authorities shall, without undue delay, provide each
other with any information which is essential or relevant for
the assessment. In this regard, the supervisory authorities
shall communicate to each other upon request all relevant
information and shall communicate on their own initiative all
essential information. A decision by the supervisory authority
that has authorised the insurance or reinsurance undertaking in
which the acquisition is proposed shall indicate any views or
reservations expressed by the supervisory authority responsible
for the proposed acquirer.
Article 60
Information to the supervisory authority by the
insurance or reinsurance undertaking
On becoming
aware of them, insurance or reinsurance undertaking shall inform
the supervisory authorities of their home Member States of any
acquisitions or disposals of holdings in their capital that
cause those holdings to exceed or fall below any of the
thresholds referred to in Articles 56 and 57(1) to (7).
They shall also, at least once a year, inform the supervisory
authorities of the names of shareholders and members possessing
qualifying holdings and the sizes of such holdings as shown, for
example, by the information received at annual general meetings
of shareholders or members or as a result of compliance with the
regulations relating to companies listed on stock exchanges.
Article 61
Qualifying
holdings, powers of the supervisory authority
Member States shall require that, where the influence exercised
by the persons referred to in Article 56 is likely to operate
against the prudent and sound management of an insurance or
reinsurance undertaking, the supervisory authorities of the home
Member State of that undertaking in which a qualifying holding
is sought or increased take appropriate measures to put an end
to that situation. Such measures may consist, for example, in
injunctions, penalties against directors and managers, or
suspension of the exercise of the voting rights attaching to the
shares held by the shareholders or members in question.
Similar measures shall apply to natural or legal persons failing
to comply with the notification obligation referred to in
Article 56.
If a holding is acquired despite the
opposition of the supervisory authorities, the Member States
shall, regardless of any other sanctions to be adopted, provide
for any of the following:
(1) the suspension of the
exercise of the corresponding voting rights;
(2) the
nullity of any votes cast or the possibility of their annulment.
Article 62
Voting rights
For the purposes of this Section,
the voting rights referred to in Articles 9 and 10 of Directive
2004/109/EC, as well as the conditions regarding aggregation
thereof laid down in Article 12(4) and (5) of that Directive,
shall be taken into account.
Member States shall not take
into account voting rights or shares which investment firms or
credit institutions may hold as a result of providing the
underwriting of financial instruments and/or placing of
financial instruments on a firm commitment basis included under
point 6 of Section A of Annex I to Directive 2004/39/EC,
provided that those rights are, on the one hand, not exercised
or otherwise used to intervene in the management of the issuer
and, on the other, disposed of within one year of acquisition.
 
Return to Index
Solvency ii Introduction (1) to (10)
Solvency ii Introduction (11) to (20)
Solvency ii Introduction (21) to (30)
Solvency ii Introduction (31) to (40)
Solvency ii Introduction (41) to (50)
Solvency ii Introduction (51) to (60)
Solvency ii Introduction (61) to (70)
Solvency ii Introduction (71) to (80)
Solvency ii Introduction (81) to (95)
Solvency ii Articles 1 to 10
Solvency ii Articles 11 to 20
Solvency ii Articles 21 to 30
Solvency ii Articles 31 to 39
Solvency ii Articles 40 to 49
Solvency ii Articles 50 to 62
Solvency ii Articles 63 to 71
Solvency ii Articles 72 to 85
Solvency ii Articles 86 to 99
Solvency ii Articles 100 to 125
Solvency ii Articles 126 to 142
Solvency ii Articles 143 to 159
Solvency ii Articles 160 to 173
Solvency ii Articles 174 to 203
Solvency ii Articles 204 to 215
Solvency ii Articles 216 to 233
Solvency ii Articles 234 to
262
Solvency ii Articles 263 to 298
Solvency ii Articles 300 to 313
Solvency ii ANNEX 1 to 3
Solvency ii ANNEX 4 to 5
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