(1)The Secretary of State may, at the request of the company or on any grounds set out in subsection (2) below, direct that an insurance company authorised under section 3 or 4 above to carry on insurance business shall cease to be authorised to effect contracts of insurance, or contracts of any description specified in the direction.
(2)The grounds referred to in subsection (1) above are—
(a)that it appears to the Secretary of State that the company has failed to satisfy an obligation to which it is subject by virtue of this Act [F1or the Financial Services Act 1986 or, if it is a member of a recognised self-regulating organisation within the meaning of that Act, an obligation to which it is subject by virtue of the rules of that organisation];
[F2(aa)that it appears to the Secretary of State that the company has failed to satisfy an obligation to which it is subject by virtue of any provision of the law of another member State giving effect to the [F3general or long term insurance Directives];]
(b)that there exists a ground on which he would be prohibited by section 7, 8 or 9 above from issuing an authorisation to the company;
(c)that the company has ceased to be authorised to effect contracts of insurance, or contracts of a particular description, in a member State where it has its head office or where it has in accordance with section 9(2) above made a deposit.
[F4(d)that the company is a Swiss general insurance company which has ceased to be authorised to effect contracts of insurance, or contracts of a particular description, in Switzerland.]
(3)After giving a direction under this section otherwise than at the request of the company concerned the Secretary of State shall inform the company concerned of his reasons for giving the direction.
(4)A direction under this section shall not prevent a company from effecting a contract of insurance in pursuance of a term of a subsisting contract of insurance.
[F5(5)Where a direction under this section has been given in respect of—
(a)a company which has its head office, or has in accordance with section 9(2) above made a deposit, in a member State other than the United Kingdom; or
(b)a Swiss general insurance company, the Secretary of State may revoke or vary the direction if after consultation with the supervisory authority in that member State or, as the case may be, in Switzerland he considers it appropriate to do so.]
(6)Subject to subsection (5) above a direction given under this section in respect of any insurance company may not be revoked or varied; but if the Secretary of State subsequently issues to the company under section 3 above an authorisation to carry on insurance business of a class to which the direction relates, the direction shall cease to have effect in relation to such business.
[F6(7)In this Act “Swiss general insurance company" means an insurance company—
(a)whose head office is in Switzerland;
(b)which is authorised under section 3 or 4 above to carry on general business; and
(c)whose authorisation is not restricted to reinsurance business.]
Textual Amendments
F1Words inserted by Financial Services Act 1986 (c. 60, SIF 69), s. 129, Sch. 10 para. 7(1)
F2S. 11(2)(aa) inserted by S.I. 1990/1333, reg. 8(1)
F3Words in s. 11(2)(aa) substituted (20.5.1993) by S.I. 1993/174, reg. 2(1)(a)
F4S. 11(2)(d) inserted (5.1.1994) by S.I. 1993/3127, reg. 2(4)
F5S. 11(5) substituted (5.1.1994) by S.I. 1993/3127, reg. 2(5)
F6S. 11(7) inserted (5.1.1994) by S.I. 1993/3127, reg. 2(6)
Modifications etc. (not altering text)
C1S. 11 applied by Financial Services Act 1986 (c. 60, SIF 69), ss. 98(4), 129, Sch. 10 para. 9