On 25 July 2007, HM Treasury published a consultation document on the implementation of the Reinsurance Directive (the Directive) in the UK.
The consultation document focuses on the proposed changes to UK legislation, principally the Financial Services and Markets Act 2000 (FSMA) and related secondary legislation. In practice, as many provisions in the Directive are the same as or similar to those in the Direct Insurance Directives, which have already been implemented, changes are only required in a limited number of areas where differences occur. The proposed amendments are intended to be implemented through three statutory instruments which are attached in the annexes of the consultation document.
The draft Reinsurance Directive Regulations 2007 make the main amendments which relate to passporting and insurance business transfers. In summary, passporting under the Directive is simpler as it is not subject to further process in terms of Host State supervision or approval and certain kinds of transfers of reinsurance business will be subject to a “Part VII-lite” regime which only requires a solvency certificate from the competent authorities of the Home Member State.
Many of the remaining changes necessary to implement the technical rules laid down in the Directive (such as on required solvency margins and minimum capital requirements) have already been implemented by the FSA through its Handbook.
View HM Treasury consults on implementation of the Reinsurance Directive, 25 July 2007