Transfer of Directive functionsU.K.
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12. After Article 19 insert—
“CHAPTER IIIAU.K.Transfer of functions
Article 19AU.K.Directive functions transferred to the Treasury
1. The Treasury may make regulations by statutory instrument for the purposes set out in paragraphs 3, 4 and 6.
2. A statutory instrument which contains regulations under paragraph 1 is subject to annulment in pursuance of a resolution of either House of Parliament.
3. To specify:
(a)the steps that insurance intermediaries and insurance undertakings might reasonably be expected to take to identify, prevent, manage and disclose conflicts of interest when carrying out insurance distribution activities;
(b)the criteria for determining the types of conflict of interest whose existence may damage the interests of the customers or potential customers of the insurance intermediary or insurance undertaking .
4. To specify:
(a)the criteria for assessing whether inducements paid or received by an insurance intermediary or an insurance undertaking have a detrimental impact on the quality of the relevant service to the customer;
(b)the criteria for assessing compliance of insurance intermediaries and insurance undertakings paying or receiving inducements with the obligation to act honestly, fairly and professionally in accordance with the best interests of the customer ;
5. Regulations made for the purposes set out in paragraph 4 must take into account:
(a)the nature of the services offered or provided to the customer or potential customer, taking into account the type, object, size and frequency of the transactions;
(b)the nature of the products being offered or considered, including different types of insurance-based investment products.
6. To specify how insurance intermediaries and insurance undertakings are to comply with the principles laid down in rules made by the Financial Conduct Authority under the Financial Services and Markets Act 2000, equivalent to those in Article 30 of Directive 2016/97/EU when carrying out insurance distribution activities with their customers, including, with regard to the information to be obtained when assessing the suitability and appropriateness of insurance-based investment products for their customers:
(a)the criteria insurance intermediaries and insurance undertakings must use to assess other non-complex insurance-based investment products for the purposes of rule 10A.4.1(2A)(b) of the Conduct of Business sourcebook;
(b)the content and format of records and agreements for the provision of services to customers;
(c)the content and format of periodic reports to customers on the services provided .
7. Regulations made for the purposes set out in paragraph 6 must take into account:
(a)the nature of the services offered or provided to the customer or potential customer, taking into account the type, object, size and frequency of the transactions;
(b)the nature of the products being offered or considered including different types of insurance-based investment products;
(c)the retail or professional nature of the customer or potential customer.”.
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