Directive 98/78/EC of the European Parliament and of the Council (repealed)Show full title

ANNEX II U.K. SUPPLEMENTARY SUPERVISION FOR INSURANCE UNDERTAKINGS THAT ARE SUBSIDIARIES OF AN INSURANCE HOLDING COMPANY, A REINSURANCE UNDERTAKING OR A NON-MEMBER-COUNTRY INSURANCE UNDERTAKING

1. In the case of two or more insurance undertakings referred to in Article 2(2) which are the subsidiaries of an insurance holding company, a reinsurance undertaking or a non-member-country insurance undertaking and which are established in different Member States, the competent authorities shall ensure that the method described in this Annex is applied in a consistent manner. U.K.

The competent authorities shall exercise the supplementary supervision with the same frequency as that laid down by Directives 73/239/EEC and 79/267/EEC for calculating the solvency margin of insurance undertakings.

2. Member States may waive the calculation provided for in this Annex with regard to an insurance undertaking: U.K.

• if that insurance undertaking is a related undertaking of another insurance undertaking and if it is taken into account in the calculation provided for in this Annex carried out for that other undertaking,

• if that insurance undertaking and one or more other insurance undertakings authorised in the same Member State have as their parent undertaking the same insurance holding company, reinsurance undertaking or non-member-country insurance undertaking, and the insurance undertaking is taken into account in the calculation provided for in this Annex carried out for one of these other undertakings,

• if that insurance undertaking and one or more other insurance undertakings authorised in other Member States have as their parent undertaking the same insurance holding company, reinsurance undertaking or non-member-country insurance undertaking, and an agreement granting exercise of the supplementary supervision covered by this Annex to the supervisory authority of another Member State has been concluded in accordance with Article 4(2).

In the case of successive participations (for example: an insurance holding company or a reinsurance undertaking which is itself owned by another insurance holding company, a reinsurance undertaking or a non-member-country insurance undertaking), Member States may apply the calculations provided for in this Annex only at the level of the ultimate parent undertaking of the insurance undertaking which is an insurance holding company, a reinsurance undertaking or a non-member-country insurance undertaking.

3. The competent authorities shall ensure that calculations analogous to those described in Annex I are carried out at the level of the insurance holding company, reinsurance undertaking or non-member-country insurance undertaking. U.K.

The analogy shall consist in applying the general principles and methods described in Annex I at the level of the insurance holding company, reinsurance undertaking or non-member-country insurance undertaking.

For the sole purpose of this calculation, the parent undertaking shall be treated as if it were an insurance undertaking subject to:

• a zero solvency requirement where it is an insurance holding company,

• a notional solvency requirement as provided for in section 2.2 of Annex I where it is a reinsurance undertaking, or as provided for in section 2.4(B) of Annex I where it is a reinsurance undertaking with its registered office in a non-member country,

• a solvency requirement determined according to the principles of section 2.4(A) of Annex I, where it is a non-member-country insurance undertaking,

and is subject to the same conditions as laid down in Article 16(1) of Directive 73/239/EEC or in Article 18 of Directive 79/267/EEC as regards the elements eligible for the solvency margin.

4. Non-availability of the necessary information U.K.

Where information necessary for the calculation provided for in this Annex, concerning a related undertaking with its registered office in a Member State or a non-member country, is not available to the competent authorities, for whatever reason, the book value of that undertaking in the participating undertaking shall be deducted from the elements eligible for the calculation provided for in this Annex. In that case, the unrealised gains connected with such participation shall not be allowed as an element eligible for the calculation.