Substituted by Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 in respect of the powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority).

Inserted by Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 in respect of the powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority).

Substituted by Directive 2011/89/EU of the European Parliament and of the Council of 16 November 2011 amending Directives 98/78/EC, 2002/87/EC, 2006/48/EC and 2009/138/EC as regards the supplementary supervision of financial entities in a financial conglomerate (Text with EEA relevance).

http://www.legislation.gov.uk/eudr/2009/138/title/III/chapter/II/section/1/subsection/6Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (recast) (Text with EEA relevance)Directive 2009/138/EC of the European Parliament and of the CouncilDirective 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (recast) (Text with EEA relevance)2020-12-12King's Printer of Acts of Parliamenthttps://webarchive.nationalarchives.gov.uk/eu-exit/https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:02009L0138-20190113texttext/xmlen2019-01-13<num>TITLE III</num><heading>SUPERVISION OF INSURANCE AND REINSURANCE UNDERTAKINGS IN A GROUP</heading><chapter eId="title-III-chapter-II"><num>CHAPTER II</num><heading>Financial position</heading><section eId="title-III-chapter-II-section-1"><num>Section 1</num><heading>Group solvency</heading><subsection eId="title-III-chapter-II-section-1-subsection-6" uk:target="true"><num>Subsection 6</num><heading>Supervision of group solvency for groups with centralised risk management</heading><article eId="article-236"><num>Article 236</num><heading>Subsidiaries of an insurance or reinsurance undertaking: conditions</heading><content><p>Member States shall provide that the rules laid down in Articles 238 and 239 shall apply to any insurance or reinsurance undertaking which is the subsidiary of an insurance or reinsurance undertaking where all of the following conditions are satisfied:</p><blockList class="ordered alpha parens" ukl:Name="OrderedList" ukl:Type="alpha" ukl:Decoration="parens"><item><num>(a)</num><p>the subsidiary, in relation to which the group supervisor has not made a decision under Article 214(2), is included in the group supervision carried out by the group supervisor at the level of the parent undertaking in accordance with this Title;</p></item><item><num>(b)</num><p>the risk-management processes and internal control mechanisms of the parent undertaking cover the subsidiary and the parent undertaking satisfies the supervisory authorities concerned regarding the prudent management of the subsidiary;</p></item><item><num>(c)</num><p>the parent undertaking has received the agreement referred to in the third subparagraph of Article 246(4);</p></item><item><num>(d)</num><p>the parent undertaking has received the agreement referred to in Article 256(2);</p></item><item><num>(e)</num><p>an application for permission to be subject to Articles 238 and 239 has been submitted by the parent undertaking and a favourable decision has been made on such application in accordance with the procedure set out in Article <i>237</i>.</p></item></blockList></content></article><article eId="article-237"><num><ins class="substitution first" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>Article 237</ins></num><heading><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Subsidiaries of an insurance or reinsurance undertaking: decision on the application</ins></heading><paragraph eId="article-237-1"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">1.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">In the case of applications for permission to be subject to the rules laid down in Articles 238 and 239, the supervisory authorities concerned shall work together within the college of supervisors, in full cooperation, to decide whether or not to grant the permission sought and to determine the other terms and conditions, if any, to which such permission should be subject.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">An application as referred to in the first subparagraph shall be submitted only to the supervisory authority having authorised the subsidiary. That supervisory authority shall inform the other members of the college of supervisors and forward the complete application to them, without delay.</ins> </p></content></paragraph><paragraph eId="article-237-2"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">2.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">The supervisory authorities concerned shall do everything within their power to reach a joint decision on the application within three months from the date of receipt of the complete application by all supervisory authorities within the college of supervisors.</ins> </p></content></paragraph><paragraph eId="article-237-3"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">3.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">If, within the three-month period referred to in paragraph 2, any of the supervisory authorities concerned has referred the matter to EIOPA in accordance with Article 19 of Regulation (EU) No 1094/2010, the group supervisor shall defer its decision and await any decision that EIOPA may take in accordance with Article 19(3) of that Regulation, and shall take its decision in conformity with EIOPA's decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">EIOPA shall take its decision within one month. The matter shall not be referred to EIOPA after the end of the three-month period or after a joint decision has been reached.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">If, in accordance with Article 41(2) and (3) and Article 44(1)(3) of Regulation (EU) No 1094/2010, the decision proposed by the panel is rejected, the group supervisor shall take a final decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned. The three-month period shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation.</ins> </p></content></paragraph><paragraph eId="article-237-4"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">4.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">EIOPA may develop draft implementing technical standards to ensure uniform conditions of application of the joint decision process referred to in paragraph 2 with regard to the applications for permissions referred to in paragraph 1, with a view to facilitating joint decisions.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1094/2010.</ins> </p></content></paragraph><paragraph eId="article-237-5"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">5.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Where the supervisory authorities concerned have reached a joint decision referred to in paragraph 2, the supervisory authority having authorised the subsidiary shall provide the applicant with the decision stating the full reasons. The joint decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p></content></paragraph><paragraph eId="article-237-6"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">6.</ins></num><intro><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">In the absence of a joint decision of the supervisory authorities concerned within the three-month period set out in paragraph 2, the group supervisor shall take its own decision with regard to the application.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">During that period the group supervisor shall duly consider the following:</ins> </p></intro><level class="para1"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">(a)</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">any views and reservations of the supervisory authorities concerned;</ins> </p></content></level><level class="para1"><num><ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">(b)</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">any reservations of the other supervisory authorities within the college of supervisors.</ins> </p></content></level><wrapUp><p> <ins class="substitution last" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">The decision shall state the full reasons and shall contain an explanation of any significant deviation from the reservations of the other supervisory authorities concerned. The group supervisor shall provide the applicant and the other supervisory authorities concerned with a copy of the decision. The decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p></wrapUp></paragraph></article><article eId="article-238"><num>Article 238</num><heading>Subsidiaries of an insurance or reinsurance undertaking: determination of the Solvency Capital Requirement</heading><paragraph eId="article-238-1"><num>1.</num><content><p>Without prejudice to Article 231, the Solvency Capital Requirement of the subsidiary shall be calculated as set out in paragraphs 2, 4, and 5 of this Article.</p></content></paragraph><paragraph eId="article-238-2"><num>2.</num><content><p>Where the Solvency Capital Requirement of the subsidiary is calculated on the basis of an internal model approved at group level in accordance with Article 231 and the supervisory authority having authorised the subsidiary considers that its risk profile deviates significantly from this internal model, and as long as that undertaking does not properly address the concerns of the supervisory authority, that authority may, in the cases referred to in Article 37, propose to set a capital add-on to the Solvency Capital Requirement of that subsidiary resulting from the application of such model or, in exceptional circumstances where such capital add-on would not be appropriate, to require that undertaking to calculate its Solvency Capital Requirement on the basis of the standard formula. The supervisory authority shall discuss its proposal within the college of supervisors and communicate the grounds for such proposals to both the subsidiary and the college of supervisors.</p></content></paragraph><paragraph eId="article-238-3"><num>3.</num><content><p>Where the Solvency Capital Requirement of the subsidiary is calculated on the basis of the standard formula and the supervisory authority having authorised the subsidiary considers that its risk profile deviates significantly from the assumptions underlying the standard formula, and as long as that undertaking does not properly address the concerns of the supervisory authority, that authority may, in exceptional circumstances, propose that the undertaking replace a subset of the parameters used in the standard formula calculation by parameters specific to that undertaking when calculating the life, non-life and health underwriting risk modules, as set out in Article 110, or in the cases referred to in Article 37, to set a capital add-on to the Solvency Capital Requirement of that subsidiary.</p><p>The supervisory authority shall discuss its proposal within the college of supervisors and communicate the grounds for such proposal to both the subsidiary and the college of supervisors.</p></content></paragraph><paragraph eId="article-238-4"><num><ins class="substitution first" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>4.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004">The college of supervisors shall do everything within its power to reach an agreement on the proposal of the supervisory authority having authorised the subsidiary or on other possible measures.</ins> </p><p> <ins class="substitution last" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004">That agreement shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p></content></paragraph><paragraph eId="article-238-5"><num><ins class="substitution first" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>5.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">Where the supervisory authority and the group supervisor disagree, either supervisor may, within one month from the proposal of the supervisory authority, refer the matter to EIOPA and request its assistance in accordance with Article 19 of Regulation (EU) No 1094/2010. In that case, EIOPA may act in accordance with the powers conferred to it by that Article, and shall take its decision within one month of such referral. The one-month period shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation. The matter shall not be referred to EIOPA after the end of the one-month period referred to in this subparagraph or after an agreement has been reached within the college in accordance with paragraph 4 of this Article.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The supervisory authority having authorised that subsidiary shall defer its decision and await any decision that EIOPA may take in accordance with Article 19 of that Regulation, and shall take its decision in conformity with EIOPA's decision.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p><p> <ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The decision shall state the full reasons on which it is based.</ins> </p><p> <ins class="substitution last" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The decision shall be submitted to the subsidiary and to the college of supervisors.</ins> </p></content></paragraph></article><article eId="article-239"><num>Article 239</num><heading>Subsidiaries of an insurance or reinsurance undertaking: non-compliance with the Solvency and Minimum Capital Requirements</heading><paragraph eId="article-239-1"><num>1.</num><content><p>In the event of non-compliance with the Solvency Capital Requirement and without prejudice to Article 138, the supervisory authority having authorised the subsidiary shall, without delay, forward to the college of supervisors the recovery plan submitted by the subsidiary in order to achieve, within six months from the observation of non-compliance with the Solvency Capital Requirement, the reestablishment of the level of eligible own funds or the reduction of its risk profile to ensure compliance with the Solvency Capital Requirement.</p><p>The college of supervisors shall do everything within its power to reach an agreement on the proposal of the supervisory authority regarding the approval of the recovery plan within four months from the date on which non-compliance with the Solvency Capital Requirement was first observed.</p><p>In the absence of such agreement, the supervisory authority having authorised the subsidiary shall decide whether the recovery plan should be approved, taking due account of the views and reservations of the other supervisory authorities within the college of supervisors.</p></content></paragraph><paragraph eId="article-239-2"><num>2.</num><content><p>Where the supervisory authority having authorised the subsidiary identifies, in accordance with Article 136, deteriorating financial conditions, it shall notify the college of supervisors without delay of the proposed measures to be taken. Save in emergency situations, the measures to be taken shall be discussed within the college of supervisors.</p><p>The college of supervisors shall do everything within its power to reach an agreement on the proposed measures to be taken within one month of notification.</p><p>In the absence of such agreement, the supervisory authority having authorised the subsidiary shall decide whether the proposed measures should be approved, taking due account of the views and reservations of the other supervisory authorities within the college of supervisors.</p></content></paragraph><paragraph eId="article-239-3"><num>3.</num><content><p>In the event of non-compliance with the Minimum Capital Requirement and without prejudice to Article 139, the supervisory authority having authorised the subsidiary shall, without delay, forward to the college of supervisors the short-term finance scheme submitted by the subsidiary in order to achieve, within three months from the date on which non-compliance with the Minimum Capital Requirement was first observed, the reestablishment of the level of eligible own funds covering the Minimum Capital Requirement or the reduction of its risk profile to ensure compliance with the Minimum Capital Requirement. The college of supervisors shall also be informed of any measures taken to enforce the Minimum Capital Requirement at the level of the subsidiary.</p></content></paragraph><paragraph eId="article-239-4"><num><ins class="first" ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002"><noteRef uk:name="commentary" href="#c000002" class="commentary"/>4.</ins></num><hcontainer name="wrapper1"><intro><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The supervisory authority or the group supervisor may refer the matter to EIOPA and request its assistance in accordance with Article 19 of Regulation (EU) No 1094/2010 where they disagree regarding either of the following:</ins> </p></intro><level class="para1"><num><ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(a)</ins></num><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">on the approval of the recovery plan, including any extension of the recovery period, within the four-month period referred to in paragraph 1; or</ins> </p></content></level><level class="para1"><num><ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(b)</ins></num><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">on the approval of the proposed measures, within the one-month period referred to in paragraph 2.</ins> </p></content></level></hcontainer><hcontainer name="wrapper1"><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">In those cases, EIOPA may act in accordance with the powers conferred to it by that Article, and shall take its decision within one month of such referral.</ins> </p></content></hcontainer><hcontainer name="wrapper1"><intro><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The matter shall not be referred to EIOPA:</ins> </p></intro><level class="para1"><num><ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(a)</ins></num><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">after the end of the four-month or the one-month period respectively referred to in the first subparagraph;</ins> </p></content></level><level class="para1"><num><ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(b)</ins></num><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">after an agreement has been reached within the college in accordance with the second subparagraph of paragraph 1 or the second subparagraph of paragraph 2;</ins> </p></content></level><level class="para1"><num><ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(c)</ins></num><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">in the case of emergency situations as referred to in paragraph 2.</ins> </p></content></level></hcontainer><hcontainer name="wrapper1"><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The four-month or the one-month period respectively shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation.</ins> </p></content></hcontainer><hcontainer name="wrapper1"><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The supervisory authority having authorised that subsidiary shall defer its decision and await any decision that EIOPA may take in accordance with Article 19(3) of that regulation, and shall take its final decision in conformity with EIOPA's decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins> </p></content></hcontainer><hcontainer name="wrapper1"><content><p> <ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The decision shall state the full reasons on which it is based.</ins> </p></content></hcontainer><hcontainer name="wrapper1"><content><p> <ins class="last" ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The decision shall be submitted to the subsidiary and to the college of supervisors.</ins> </p></content></hcontainer></paragraph></article><article eId="article-240"><num>Article 240</num><heading>Subsidiaries of an insurance or reinsurance undertaking: end of derogations for a subsidiary</heading><paragraph eId="article-240-1"><num>1.</num><intro><p>The rules provided for in Articles 238 and 239 shall cease to apply where:</p></intro><level class="para1"><num>(a)</num><content><p>the condition referred to in Article 236(a) is no longer complied with;</p></content></level><level class="para1"><num>(b)</num><content><p>the condition referred to in Article 236(b) is no longer complied with and the group does not restore compliance with this condition in an appropriate period of time;</p></content></level><level class="para1"><num>(c)</num><content><p>the conditions referred to in Article 236(c) and (d) are no longer complied with.</p></content></level><wrapUp><p>In the case referred to in point (a) of the first subparagraph, where the group supervisor decides, after consulting the college of supervisors, no longer to include the subsidiary in the group supervision it carries out, it shall immediately inform the supervisory authority concerned and the parent undertaking.</p><p>For the purposes of Article 236(b), (c) and (d), the parent undertaking shall be responsible for ensuring that the conditions are complied with on an ongoing basis. In the event of non-compliance, it shall inform the group supervisor and the supervisor of the subsidiary concerned without delay. The parent undertaking shall present a plan to restore compliance within an appropriate period of time.</p><p>Without prejudice to the third subparagraph, the group supervisor shall verify at least annually, on its own initiative, that the conditions referred to in Article 236(b), (c) and (d) continue to be complied with. The group supervisor shall also perform such verification upon request from the supervisory authority concerned, where the latter has significant concerns related to the ongoing compliance with those conditions.</p><p>Where the verification performed identifies weaknesses, the group supervisor shall require the parent undertaking to present a plan to restore compliance within an appropriate period of time.</p><p>Where, after consulting the college of supervisors, the group supervisor determines that the plan referred to in the third or fifth subparagraph is insufficient or subsequently that it is not being implemented within the agreed period of time, the group supervisor shall conclude that the conditions referred to in Article 236(b), (c) and (d) are no longer complied with and it shall immediately inform the supervisory authority concerned.</p></wrapUp></paragraph><paragraph eId="article-240-2"><num>2.</num><content><p>The regime provided for in Articles 238 and 239 shall be applicable again where the parent undertaking submits a new application and obtains a favourable decision in accordance with the procedure set out in Article 237.</p></content></paragraph></article><article eId="article-241"><num><ins class="substitution first" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>Article 241</ins></num><heading><ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">Subsidiaries of an insurance or reinsurance undertaking: delegated acts</ins></heading><content><p> <ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">The Commission shall adopt delegated acts in accordance with Article 301a specifying:</ins> </p><blockList class="ordered alpha parens" ukl:Name="OrderedList" ukl:Type="alpha" ukl:Decoration="parens"><item><num>(a)</num><p> <ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the criteria for assessing whether the conditions stated in Article 236 are satisfied;</ins> </p></item><item><num>(b)</num><p> <ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the criteria for assessing what should be considered an emergency situation under Article 239(2);</ins> </p></item><item><num>(c)</num><p> <ins class="substitution last" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the procedures to be followed by supervisory authorities when exchanging information, exercising their rights and fulfilling their duties in accordance with Articles 237 to 240.</ins> </p></item></blockList></content></article><article eId="article-242"><num>Article 242</num><heading>Review</heading><paragraph eId="article-242-1"><num><ins class="substitution first" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>1.</ins></num><content><p> <ins class="substitution" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">By </ins> <ins class="substitution" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">31 December 2017</ins> <ins class="substitution last" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">, the Commission shall make an assessment of the application of Title III, in particular as regards the cooperation of supervisory authorities within, and functionality of, the college of supervisors and the supervisory practices concerning setting the capital add-ons, and shall present a report to the European Parliament and to the Council accompanied, where appropriate, by proposals for the amendment of this Directive.</ins> </p></content></paragraph><paragraph eId="article-242-2"><num>2.</num><intro><p>By <ins class="substitution first last" ukl:ChangeId="O005001M081" ukl:CommentaryRef="c000004"><noteRef uk:name="commentary" href="#c000004" class="commentary"/>31 December 2018</ins>, the Commission shall make an assessment of the benefit of enhancing group supervision and capital management within a group of insurance or reinsurance undertakings including a reference to COM(2008)0119 and the report of the Committee on Economic and Monetary Affairs of the European Parliament on this proposal of 16 October 2008 (A6-0413/2008). That assessment shall include possible measures to enhance a sound cross-border management of insurance groups notably of risks and asset management. In its assessment, the Commission shall, <i>inter alia</i>, take into account new developments and progress concerning:</p></intro><level class="para1"><num>(a)</num><content><p>a harmonised framework on early intervention;</p></content></level><level class="para1"><num>(b)</num><content><p>practices in centralised group risk management and functioning of group internal models including stress testing;</p></content></level><level class="para1"><num>(c)</num><content><p>intra-group transactions and risk concentrations;</p></content></level><level class="para1"><num>(d)</num><content><p>the behaviour of diversification and concentration effects over time;</p></content></level><level class="para1"><num>(e)</num><content><p>a legally binding framework for the mediation of supervisory disputes;</p></content></level><level class="para1"><num>(f)</num><content><p>a harmonised framework on asset transferability, insolvency and winding-up procedures which eliminates the relevant national company or corporate law barriers to asset transferability;</p></content></level><level class="para1"><num>(g)</num><content><p>an equivalent level of protection of policy holders and beneficiaries of the undertakings of the same group particularly in crisis situations;</p></content></level><level class="para1"><num>(h)</num><content><p>a harmonised and adequately funded EU-wide solution for insurance guarantee schemes;</p></content></level><level class="para1"><num>(i)</num><content><p>a harmonised and legally binding framework between competent authorities, central banks and ministries of finance concerning crisis management, resolution and fiscal burden-sharing which aligns supervisory powers with fiscal responsibilities.</p></content></level><wrapUp><p>The Commission shall present a report to the European Parliament and the Council, accompanied, where appropriate, by proposals for the amendment of this Directive.</p></wrapUp></paragraph></article><article eId="article-243"><num><ins class="substitution first" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001"><noteRef uk:name="commentary" href="#c000001" class="commentary"/>Article 243</ins></num><heading><ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">Subsidiaries of an insurance holding company and mixed financial holding company</ins></heading><content><p> <ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">Articles 236 to 242 shall apply </ins> <i> <ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">mutatis mutandis</ins> </i> <ins class="substitution last" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001"> to insurance and reinsurance undertakings which are the subsidiary of an insurance holding company or mixed financial holding company.</ins> </p></content></article></subsection></section></chapter>
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<p>
Substituted by
<ref href="http://www.legislation.gov.uk/id/eudr/2014/51">Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 in respect of the powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority)</ref>
.
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<p>
Inserted by
<ref href="http://www.legislation.gov.uk/id/eudr/2014/51">Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 in respect of the powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority)</ref>
.
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<note ukl:Name="Commentary" ukl:Type="F" class="commentary F" eId="c000001" marker="F3">
<p>
Substituted by
<ref href="http://www.legislation.gov.uk/id/eudr/2011/89">Directive 2011/89/EU of the European Parliament and of the Council of 16 November 2011 amending Directives 98/78/EC, 2002/87/EC, 2006/48/EC and 2009/138/EC as regards the supplementary supervision of financial entities in a financial conglomerate (Text with EEA relevance)</ref>
.
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<body eId="body">
<title eId="title-III">
<num>TITLE III</num>
<heading>SUPERVISION OF INSURANCE AND REINSURANCE UNDERTAKINGS IN A GROUP</heading>
<chapter eId="title-III-chapter-II">
<num>CHAPTER II</num>
<heading>Financial position</heading>
<section eId="title-III-chapter-II-section-1">
<num>Section 1</num>
<heading>Group solvency</heading>
<subsection eId="title-III-chapter-II-section-1-subsection-6" uk:target="true">
<num>Subsection 6</num>
<heading>Supervision of group solvency for groups with centralised risk management</heading>
<article eId="article-236">
<num>Article 236</num>
<heading>Subsidiaries of an insurance or reinsurance undertaking: conditions</heading>
<content>
<p>Member States shall provide that the rules laid down in Articles 238 and 239 shall apply to any insurance or reinsurance undertaking which is the subsidiary of an insurance or reinsurance undertaking where all of the following conditions are satisfied:</p>
<blockList class="ordered alpha parens" ukl:Name="OrderedList" ukl:Type="alpha" ukl:Decoration="parens">
<item>
<num>(a)</num>
<p>the subsidiary, in relation to which the group supervisor has not made a decision under Article 214(2), is included in the group supervision carried out by the group supervisor at the level of the parent undertaking in accordance with this Title;</p>
</item>
<item>
<num>(b)</num>
<p>the risk-management processes and internal control mechanisms of the parent undertaking cover the subsidiary and the parent undertaking satisfies the supervisory authorities concerned regarding the prudent management of the subsidiary;</p>
</item>
<item>
<num>(c)</num>
<p>the parent undertaking has received the agreement referred to in the third subparagraph of Article 246(4);</p>
</item>
<item>
<num>(d)</num>
<p>the parent undertaking has received the agreement referred to in Article 256(2);</p>
</item>
<item>
<num>(e)</num>
<p>
an application for permission to be subject to Articles 238 and 239 has been submitted by the parent undertaking and a favourable decision has been made on such application in accordance with the procedure set out in Article
<i>237</i>
.
</p>
</item>
</blockList>
</content>
</article>
<article eId="article-237">
<num>
<ins class="substitution first" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
Article 237
</ins>
</num>
<heading>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Subsidiaries of an insurance or reinsurance undertaking: decision on the application</ins>
</heading>
<paragraph eId="article-237-1">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">1.</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">In the case of applications for permission to be subject to the rules laid down in Articles 238 and 239, the supervisory authorities concerned shall work together within the college of supervisors, in full cooperation, to decide whether or not to grant the permission sought and to determine the other terms and conditions, if any, to which such permission should be subject.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">An application as referred to in the first subparagraph shall be submitted only to the supervisory authority having authorised the subsidiary. That supervisory authority shall inform the other members of the college of supervisors and forward the complete application to them, without delay.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-237-2">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">2.</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">The supervisory authorities concerned shall do everything within their power to reach a joint decision on the application within three months from the date of receipt of the complete application by all supervisory authorities within the college of supervisors.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-237-3">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">3.</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">If, within the three-month period referred to in paragraph 2, any of the supervisory authorities concerned has referred the matter to EIOPA in accordance with Article 19 of Regulation (EU) No 1094/2010, the group supervisor shall defer its decision and await any decision that EIOPA may take in accordance with Article 19(3) of that Regulation, and shall take its decision in conformity with EIOPA's decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">EIOPA shall take its decision within one month. The matter shall not be referred to EIOPA after the end of the three-month period or after a joint decision has been reached.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">If, in accordance with Article 41(2) and (3) and Article 44(1)(3) of Regulation (EU) No 1094/2010, the decision proposed by the panel is rejected, the group supervisor shall take a final decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned. The three-month period shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-237-4">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">4.</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">EIOPA may develop draft implementing technical standards to ensure uniform conditions of application of the joint decision process referred to in paragraph 2 with regard to the applications for permissions referred to in paragraph 1, with a view to facilitating joint decisions.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Power is conferred on the Commission to adopt the implementing technical standards referred to in the first subparagraph in accordance with Article 15 of Regulation (EU) No 1094/2010.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-237-5">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">5.</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">Where the supervisory authorities concerned have reached a joint decision referred to in paragraph 2, the supervisory authority having authorised the subsidiary shall provide the applicant with the decision stating the full reasons. The joint decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-237-6">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">6.</ins>
</num>
<intro>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">In the absence of a joint decision of the supervisory authorities concerned within the three-month period set out in paragraph 2, the group supervisor shall take its own decision with regard to the application.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">During that period the group supervisor shall duly consider the following:</ins>
</p>
</intro>
<level class="para1">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">(a)</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">any views and reservations of the supervisory authorities concerned;</ins>
</p>
</content>
</level>
<level class="para1">
<num>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">(b)</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">any reservations of the other supervisory authorities within the college of supervisors.</ins>
</p>
</content>
</level>
<wrapUp>
<p>
<ins class="substitution last" ukl:ChangeId="O005001M075" ukl:CommentaryRef="c000004">The decision shall state the full reasons and shall contain an explanation of any significant deviation from the reservations of the other supervisory authorities concerned. The group supervisor shall provide the applicant and the other supervisory authorities concerned with a copy of the decision. The decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
</wrapUp>
</paragraph>
</article>
<article eId="article-238">
<num>Article 238</num>
<heading>Subsidiaries of an insurance or reinsurance undertaking: determination of the Solvency Capital Requirement</heading>
<paragraph eId="article-238-1">
<num>1.</num>
<content>
<p>Without prejudice to Article 231, the Solvency Capital Requirement of the subsidiary shall be calculated as set out in paragraphs 2, 4, and 5 of this Article.</p>
</content>
</paragraph>
<paragraph eId="article-238-2">
<num>2.</num>
<content>
<p>Where the Solvency Capital Requirement of the subsidiary is calculated on the basis of an internal model approved at group level in accordance with Article 231 and the supervisory authority having authorised the subsidiary considers that its risk profile deviates significantly from this internal model, and as long as that undertaking does not properly address the concerns of the supervisory authority, that authority may, in the cases referred to in Article 37, propose to set a capital add-on to the Solvency Capital Requirement of that subsidiary resulting from the application of such model or, in exceptional circumstances where such capital add-on would not be appropriate, to require that undertaking to calculate its Solvency Capital Requirement on the basis of the standard formula. The supervisory authority shall discuss its proposal within the college of supervisors and communicate the grounds for such proposals to both the subsidiary and the college of supervisors.</p>
</content>
</paragraph>
<paragraph eId="article-238-3">
<num>3.</num>
<content>
<p>Where the Solvency Capital Requirement of the subsidiary is calculated on the basis of the standard formula and the supervisory authority having authorised the subsidiary considers that its risk profile deviates significantly from the assumptions underlying the standard formula, and as long as that undertaking does not properly address the concerns of the supervisory authority, that authority may, in exceptional circumstances, propose that the undertaking replace a subset of the parameters used in the standard formula calculation by parameters specific to that undertaking when calculating the life, non-life and health underwriting risk modules, as set out in Article 110, or in the cases referred to in Article 37, to set a capital add-on to the Solvency Capital Requirement of that subsidiary.</p>
<p>The supervisory authority shall discuss its proposal within the college of supervisors and communicate the grounds for such proposal to both the subsidiary and the college of supervisors.</p>
</content>
</paragraph>
<paragraph eId="article-238-4">
<num>
<ins class="substitution first" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
4.
</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004">The college of supervisors shall do everything within its power to reach an agreement on the proposal of the supervisory authority having authorised the subsidiary or on other possible measures.</ins>
</p>
<p>
<ins class="substitution last" ukl:ChangeId="O005001M076" ukl:CommentaryRef="c000004">That agreement shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-238-5">
<num>
<ins class="substitution first" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
5.
</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">Where the supervisory authority and the group supervisor disagree, either supervisor may, within one month from the proposal of the supervisory authority, refer the matter to EIOPA and request its assistance in accordance with Article 19 of Regulation (EU) No 1094/2010. In that case, EIOPA may act in accordance with the powers conferred to it by that Article, and shall take its decision within one month of such referral. The one-month period shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation. The matter shall not be referred to EIOPA after the end of the one-month period referred to in this subparagraph or after an agreement has been reached within the college in accordance with paragraph 4 of this Article.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The supervisory authority having authorised that subsidiary shall defer its decision and await any decision that EIOPA may take in accordance with Article 19 of that Regulation, and shall take its decision in conformity with EIOPA's decision.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
<p>
<ins class="substitution" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The decision shall state the full reasons on which it is based.</ins>
</p>
<p>
<ins class="substitution last" ukl:ChangeId="O005001M077" ukl:CommentaryRef="c000004">The decision shall be submitted to the subsidiary and to the college of supervisors.</ins>
</p>
</content>
</paragraph>
</article>
<article eId="article-239">
<num>Article 239</num>
<heading>Subsidiaries of an insurance or reinsurance undertaking: non-compliance with the Solvency and Minimum Capital Requirements</heading>
<paragraph eId="article-239-1">
<num>1.</num>
<content>
<p>In the event of non-compliance with the Solvency Capital Requirement and without prejudice to Article 138, the supervisory authority having authorised the subsidiary shall, without delay, forward to the college of supervisors the recovery plan submitted by the subsidiary in order to achieve, within six months from the observation of non-compliance with the Solvency Capital Requirement, the reestablishment of the level of eligible own funds or the reduction of its risk profile to ensure compliance with the Solvency Capital Requirement.</p>
<p>The college of supervisors shall do everything within its power to reach an agreement on the proposal of the supervisory authority regarding the approval of the recovery plan within four months from the date on which non-compliance with the Solvency Capital Requirement was first observed.</p>
<p>In the absence of such agreement, the supervisory authority having authorised the subsidiary shall decide whether the recovery plan should be approved, taking due account of the views and reservations of the other supervisory authorities within the college of supervisors.</p>
</content>
</paragraph>
<paragraph eId="article-239-2">
<num>2.</num>
<content>
<p>Where the supervisory authority having authorised the subsidiary identifies, in accordance with Article 136, deteriorating financial conditions, it shall notify the college of supervisors without delay of the proposed measures to be taken. Save in emergency situations, the measures to be taken shall be discussed within the college of supervisors.</p>
<p>The college of supervisors shall do everything within its power to reach an agreement on the proposed measures to be taken within one month of notification.</p>
<p>In the absence of such agreement, the supervisory authority having authorised the subsidiary shall decide whether the proposed measures should be approved, taking due account of the views and reservations of the other supervisory authorities within the college of supervisors.</p>
</content>
</paragraph>
<paragraph eId="article-239-3">
<num>3.</num>
<content>
<p>In the event of non-compliance with the Minimum Capital Requirement and without prejudice to Article 139, the supervisory authority having authorised the subsidiary shall, without delay, forward to the college of supervisors the short-term finance scheme submitted by the subsidiary in order to achieve, within three months from the date on which non-compliance with the Minimum Capital Requirement was first observed, the reestablishment of the level of eligible own funds covering the Minimum Capital Requirement or the reduction of its risk profile to ensure compliance with the Minimum Capital Requirement. The college of supervisors shall also be informed of any measures taken to enforce the Minimum Capital Requirement at the level of the subsidiary.</p>
</content>
</paragraph>
<paragraph eId="article-239-4">
<num>
<ins class="first" ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">
<noteRef uk:name="commentary" href="#c000002" class="commentary"/>
4.
</ins>
</num>
<hcontainer name="wrapper1">
<intro>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The supervisory authority or the group supervisor may refer the matter to EIOPA and request its assistance in accordance with Article 19 of Regulation (EU) No 1094/2010 where they disagree regarding either of the following:</ins>
</p>
</intro>
<level class="para1">
<num>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(a)</ins>
</num>
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">on the approval of the recovery plan, including any extension of the recovery period, within the four-month period referred to in paragraph 1; or</ins>
</p>
</content>
</level>
<level class="para1">
<num>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(b)</ins>
</num>
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">on the approval of the proposed measures, within the one-month period referred to in paragraph 2.</ins>
</p>
</content>
</level>
</hcontainer>
<hcontainer name="wrapper1">
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">In those cases, EIOPA may act in accordance with the powers conferred to it by that Article, and shall take its decision within one month of such referral.</ins>
</p>
</content>
</hcontainer>
<hcontainer name="wrapper1">
<intro>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The matter shall not be referred to EIOPA:</ins>
</p>
</intro>
<level class="para1">
<num>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(a)</ins>
</num>
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">after the end of the four-month or the one-month period respectively referred to in the first subparagraph;</ins>
</p>
</content>
</level>
<level class="para1">
<num>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(b)</ins>
</num>
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">after an agreement has been reached within the college in accordance with the second subparagraph of paragraph 1 or the second subparagraph of paragraph 2;</ins>
</p>
</content>
</level>
<level class="para1">
<num>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">(c)</ins>
</num>
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">in the case of emergency situations as referred to in paragraph 2.</ins>
</p>
</content>
</level>
</hcontainer>
<hcontainer name="wrapper1">
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The four-month or the one-month period respectively shall be deemed the conciliation period within the meaning of Article 19(2) of that Regulation.</ins>
</p>
</content>
</hcontainer>
<hcontainer name="wrapper1">
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The supervisory authority having authorised that subsidiary shall defer its decision and await any decision that EIOPA may take in accordance with Article 19(3) of that regulation, and shall take its final decision in conformity with EIOPA's decision. That decision shall be recognised as determinative and shall be applied by the supervisory authorities concerned.</ins>
</p>
</content>
</hcontainer>
<hcontainer name="wrapper1">
<content>
<p>
<ins ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The decision shall state the full reasons on which it is based.</ins>
</p>
</content>
</hcontainer>
<hcontainer name="wrapper1">
<content>
<p>
<ins class="last" ukl:ChangeId="O005001M078" ukl:CommentaryRef="c000002">The decision shall be submitted to the subsidiary and to the college of supervisors.</ins>
</p>
</content>
</hcontainer>
</paragraph>
</article>
<article eId="article-240">
<num>Article 240</num>
<heading>Subsidiaries of an insurance or reinsurance undertaking: end of derogations for a subsidiary</heading>
<paragraph eId="article-240-1">
<num>1.</num>
<intro>
<p>The rules provided for in Articles 238 and 239 shall cease to apply where:</p>
</intro>
<level class="para1">
<num>(a)</num>
<content>
<p>the condition referred to in Article 236(a) is no longer complied with;</p>
</content>
</level>
<level class="para1">
<num>(b)</num>
<content>
<p>the condition referred to in Article 236(b) is no longer complied with and the group does not restore compliance with this condition in an appropriate period of time;</p>
</content>
</level>
<level class="para1">
<num>(c)</num>
<content>
<p>the conditions referred to in Article 236(c) and (d) are no longer complied with.</p>
</content>
</level>
<wrapUp>
<p>In the case referred to in point (a) of the first subparagraph, where the group supervisor decides, after consulting the college of supervisors, no longer to include the subsidiary in the group supervision it carries out, it shall immediately inform the supervisory authority concerned and the parent undertaking.</p>
<p>For the purposes of Article 236(b), (c) and (d), the parent undertaking shall be responsible for ensuring that the conditions are complied with on an ongoing basis. In the event of non-compliance, it shall inform the group supervisor and the supervisor of the subsidiary concerned without delay. The parent undertaking shall present a plan to restore compliance within an appropriate period of time.</p>
<p>Without prejudice to the third subparagraph, the group supervisor shall verify at least annually, on its own initiative, that the conditions referred to in Article 236(b), (c) and (d) continue to be complied with. The group supervisor shall also perform such verification upon request from the supervisory authority concerned, where the latter has significant concerns related to the ongoing compliance with those conditions.</p>
<p>Where the verification performed identifies weaknesses, the group supervisor shall require the parent undertaking to present a plan to restore compliance within an appropriate period of time.</p>
<p>Where, after consulting the college of supervisors, the group supervisor determines that the plan referred to in the third or fifth subparagraph is insufficient or subsequently that it is not being implemented within the agreed period of time, the group supervisor shall conclude that the conditions referred to in Article 236(b), (c) and (d) are no longer complied with and it shall immediately inform the supervisory authority concerned.</p>
</wrapUp>
</paragraph>
<paragraph eId="article-240-2">
<num>2.</num>
<content>
<p>The regime provided for in Articles 238 and 239 shall be applicable again where the parent undertaking submits a new application and obtains a favourable decision in accordance with the procedure set out in Article 237.</p>
</content>
</paragraph>
</article>
<article eId="article-241">
<num>
<ins class="substitution first" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
Article 241
</ins>
</num>
<heading>
<ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">Subsidiaries of an insurance or reinsurance undertaking: delegated acts</ins>
</heading>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">The Commission shall adopt delegated acts in accordance with Article 301a specifying:</ins>
</p>
<blockList class="ordered alpha parens" ukl:Name="OrderedList" ukl:Type="alpha" ukl:Decoration="parens">
<item>
<num>(a)</num>
<p>
<ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the criteria for assessing whether the conditions stated in Article 236 are satisfied;</ins>
</p>
</item>
<item>
<num>(b)</num>
<p>
<ins class="substitution" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the criteria for assessing what should be considered an emergency situation under Article 239(2);</ins>
</p>
</item>
<item>
<num>(c)</num>
<p>
<ins class="substitution last" ukl:ChangeId="O005001M079" ukl:CommentaryRef="c000004">the procedures to be followed by supervisory authorities when exchanging information, exercising their rights and fulfilling their duties in accordance with Articles 237 to 240.</ins>
</p>
</item>
</blockList>
</content>
</article>
<article eId="article-242">
<num>Article 242</num>
<heading>Review</heading>
<paragraph eId="article-242-1">
<num>
<ins class="substitution first" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
1.
</ins>
</num>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">By </ins>
<ins class="substitution" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">31 December 2017</ins>
<ins class="substitution last" ukl:ChangeId="O005001M080" ukl:CommentaryRef="c000004">, the Commission shall make an assessment of the application of Title III, in particular as regards the cooperation of supervisory authorities within, and functionality of, the college of supervisors and the supervisory practices concerning setting the capital add-ons, and shall present a report to the European Parliament and to the Council accompanied, where appropriate, by proposals for the amendment of this Directive.</ins>
</p>
</content>
</paragraph>
<paragraph eId="article-242-2">
<num>2.</num>
<intro>
<p>
By
<ins class="substitution first last" ukl:ChangeId="O005001M081" ukl:CommentaryRef="c000004">
<noteRef uk:name="commentary" href="#c000004" class="commentary"/>
31 December 2018
</ins>
, the Commission shall make an assessment of the benefit of enhancing group supervision and capital management within a group of insurance or reinsurance undertakings including a reference to COM(2008)0119 and the report of the Committee on Economic and Monetary Affairs of the European Parliament on this proposal of 16 October 2008 (A6-0413/2008). That assessment shall include possible measures to enhance a sound cross-border management of insurance groups notably of risks and asset management. In its assessment, the Commission shall,
<i>inter alia</i>
, take into account new developments and progress concerning:
</p>
</intro>
<level class="para1">
<num>(a)</num>
<content>
<p>a harmonised framework on early intervention;</p>
</content>
</level>
<level class="para1">
<num>(b)</num>
<content>
<p>practices in centralised group risk management and functioning of group internal models including stress testing;</p>
</content>
</level>
<level class="para1">
<num>(c)</num>
<content>
<p>intra-group transactions and risk concentrations;</p>
</content>
</level>
<level class="para1">
<num>(d)</num>
<content>
<p>the behaviour of diversification and concentration effects over time;</p>
</content>
</level>
<level class="para1">
<num>(e)</num>
<content>
<p>a legally binding framework for the mediation of supervisory disputes;</p>
</content>
</level>
<level class="para1">
<num>(f)</num>
<content>
<p>a harmonised framework on asset transferability, insolvency and winding-up procedures which eliminates the relevant national company or corporate law barriers to asset transferability;</p>
</content>
</level>
<level class="para1">
<num>(g)</num>
<content>
<p>an equivalent level of protection of policy holders and beneficiaries of the undertakings of the same group particularly in crisis situations;</p>
</content>
</level>
<level class="para1">
<num>(h)</num>
<content>
<p>a harmonised and adequately funded EU-wide solution for insurance guarantee schemes;</p>
</content>
</level>
<level class="para1">
<num>(i)</num>
<content>
<p>a harmonised and legally binding framework between competent authorities, central banks and ministries of finance concerning crisis management, resolution and fiscal burden-sharing which aligns supervisory powers with fiscal responsibilities.</p>
</content>
</level>
<wrapUp>
<p>The Commission shall present a report to the European Parliament and the Council, accompanied, where appropriate, by proposals for the amendment of this Directive.</p>
</wrapUp>
</paragraph>
</article>
<article eId="article-243">
<num>
<ins class="substitution first" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">
<noteRef uk:name="commentary" href="#c000001" class="commentary"/>
Article 243
</ins>
</num>
<heading>
<ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">Subsidiaries of an insurance holding company and mixed financial holding company</ins>
</heading>
<content>
<p>
<ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">Articles 236 to 242 shall apply </ins>
<i>
<ins class="substitution" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001">mutatis mutandis</ins>
</i>
<ins class="substitution last" ukl:ChangeId="O001001M012" ukl:CommentaryRef="c000001"> to insurance and reinsurance undertakings which are the subsidiary of an insurance holding company or mixed financial holding company.</ins>
</p>
</content>
</article>
</subsection>
</section>
</chapter>
</title>
</body>
</act>
</akomaNtoso>