1.The competent authorities shall require every institution located in their territories to have sound administrative and accounting procedures and adequate internal control mechanisms.
2.The competent authorities shall have the power to take any measures including, where appropriate, those of an administrative or financial nature, either with regard to any institution located in their territories or against the persons running the institution, which are appropriate and necessary to prevent or remedy any irregularities prejudicial to the interests of the members and beneficiaries.
They may also restrict or prohibit the free disposal of the institution's assets when, in particular:
(a)the institution has failed to establish sufficient technical provisions in respect of the entire business or has insufficient assets to cover the technical provisions;
(b)the institution has failed to hold the regulatory own funds.
3.In order to safeguard the interests of members and beneficiaries, the competent authorities may transfer the powers which the persons running an institution located in their territories hold in accordance with the law of the home Member State wholly or partly to a special representative who is fit to exercise these powers.
4.The competent authorities may prohibit or restrict the activities of an institution located in their territories in particular if:
(a)the institution fails to protect adequately the interests of members and beneficiaries;
(b)the institution no longer fulfils the conditions of operation;
(c)the institution fails seriously in its obligations under the rules to which it is subject;
(d)in the case of cross-border activity, the institution does not respect the requirements of social and labour law of the host Member State relevant to the field of occupational pensions.
[F1Any decision to prohibit the activities of an institution shall contain detailed reasons and be notified to the institution in question. It shall also be notified to EIOPA.]
5.Member States shall ensure that decisions taken in respect of an institution under laws, regulations and administrative provisions adopted in accordance with this Directive are subject to the right to apply to the courts.
Textual Amendments
F1 Substituted by Directive 2010/78/EU of the European Parliament and of the Council of 24 November 2010 amending Directives 98/26/EC, 2002/87/EC, 2003/6/EC, 2003/41/EC, 2003/71/EC, 2004/39/EC, 2004/109/EC, 2005/60/EC, 2006/48/EC, 2006/49/EC and 2009/65/EC in respect of the powers of the European Supervisory Authority (European Banking Authority), the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) (Text with EEA relevance).