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SUP 18.3 Insurance business transfers outside the United Kingdom

Purpose

SUP 18.3.1G

Under section 115 of the Act, the appropriate regulator2 has the power to give a certificate confirming that a firm possesses any necessary margin of solvency,1 to facilitate an insurance business transfer to the firm under overseas legislation from a firm authorised in another EEA State or from a Swiss general insurance company. This section provides guidance on how the appropriate regulator2 would exercise this power and on related matters.

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Appropriate regulator response to proposal2

SUP 18.3.1AG

2Unless otherwise expressly stated by the appropriate regulator, all the procedural aspects for dealing with insurance business transfers outside the United Kingdom should be discussed by firms with the PRA in the first instance.

SUP 18.3.2G

Under cooperation agreements between EEA regulators, if it has serious concerns about the proposed transferee, the appropriate regulator2 should inform the regulatory body of the transferor within 3 months of the original request from that regulatory body. The appropriate regulator2 is not obliged to reply, but if it does not, its opinion is taken to be favourable2. Although the protocol does not apply to Switzerland, the appropriate regulator2 is required to cooperate with the Swiss regulatory body and would apply similar principles to a proposed transfer from a Swiss general insurance company.

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SUP 18.3.3G

The information that the regulatory body of the transferor is required to supply will normally be sufficient for the appropriate regulator2 to determine whether the transfer is likely to have a material effect on the transferee.

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SUP 18.3.4G

If the effect of the transfer is not likely to be material and the appropriate regulator2 does not already have serious concerns about the transferee, the appropriate regulator2 can reply favourably.2

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SUP 18.3.5G

If the effect of the transfer may be material, the appropriate regulator2 will need to consider whether to request a scheme of operations or other information from the proposed transferee to assist in determining whether the likely effect of the transfer is such that the appropriate regulator2 should have serious concerns.

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SUP 18.3.6G

If the effect of the transfer may have a material adverse effect on the transferee or the security of policyholders, the appropriate regulator2 will consider whether it is appropriate to exercise its powers under the Act to achieve its statutory objectives2.

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