In a letter to CEIOPS dated 29 October 2010, the European Commission has confirmed the countries that will undergo the first wave of equivalence assessments under the Solvency II regime. Bermuda and Switzerland will undergo a full assessment and Japan will be assessed for equivalence in relation to reinsurance under Article 172 only. This reflects the draft advice published by CEIOPS in July 2010 (see here).

Following this draft advice, CEIOPS had indicated that it would be willing to undergo an assessment of the US if the Commission requested it to (see here). However, rather than undertake a full assessment of the US, the Commission has instead proposed a transitional regime. Third countries eligible for inclusion in this regime would be deemed equivalent for a limited time. If, at the end of that time, the third country was in a position to satisfy all of the equivalence requirements, a permanent equivalence finding would be made. It does seem clear that the US will be included in this transitional regime along with any of Bermuda, Switzerland and Japan should they not be deemed equivalent in the first wave of assessments.

The Commission also noted that when undertaking equivalence assessments, any legislative changes proposed by a third country that will be in force at the time Solvency II becomes applicable should be included in the assessment of that country.

The full letter can be found here.