January 25, 2019

EIOPA published the findings of the peer review examining how national competent authorities assess the propriety of administrative, management, or supervisory body (AMSB) members and qualifying shareholders. EIOPA reviewed national regulatory frameworks and supervisory practices followed by national competent authorities to assess the propriety of AMSB members and qualifying shareholders at the solo and group levels, both at the moment of authorization and on an ongoing basis. Furthermore, EIOPA assessed the effectiveness of cross-border cooperation.

The report presents the overall findings of the peer review, including identified best practices, case studies, and recommended actions. The report reveals that national competent authorities invest considerable resources in the initial assessment of AMSB members and qualifying shareholders. However, these tend to be seen as a one-off task with few national competent authorities undertaking any ongoing assessments as part of their supervisory activities. Ongoing assessment should involve proactive, risk-based, and proportionate engagement resulting from the national competent authorities' own initiative, as part of its supervisory activities. Other areas that were identified as requiring action from national competent authorities were related to the national legislation or regulatory framework, the propriety assessment questionnaires, and the guidance and supervisory records.

The review was initiated following a number of cross-border cases indicating a lack of harmonization in relation to the propriety assessment across the European Economic Area, leading to potentially divergent outcomes in different countries in relation to the same person. The review found that complex cross-border cases of propriety assessment can take a long time, hampered by cumbersome information-sharing processes. In relation to the definition of propriety of AMSB members, a significant variation with respect to whether and when to consider ongoing prosecution and pending investigations for criminal and administrative offences became apparent. Overall, the review resulted in 80 recommended actions for 29 national competent authorities. As a result of this peer review, EIOPA will seek to strengthen and support processes of cross-border assessments.

A key requirement of Solvency II is for insurers to be owned and run by persons of integrity. The primary responsibility to ensure the fitness and propriety of AMSB members at all times rests with insurers, with the national competent authorities conducting their assessment, following the assessment by insurers. Similarly, any acquisition of or changes to qualifying shareholders are subject to review and approval by national competent authorities.

 

Related Links

Keywords: Europe, EU, Insurance, Solvency II, Peer Review, AMSB Members, Cross-border Cooperation, Corporate Governance, EIOPA

Related Articles
News

IMF Releases Report on 2019 Article IV Consultation with United States

IMF published its staff report in the context of the 2019 Article IV consultation with the United States.

June 24, 2019 WebPage Regulatory News
News

BIS Report Discusses Regulatory Issues Related to Big Techs in Finance

BIS has pre-released a chapter of the BIS Annual Economic Report; this chapter focuses on the risks and opportunities presented by large technology firms in the financial services sector.

June 23, 2019 WebPage Regulatory News
News

IOSCO Report Examines Liquidity in Corporate Bond Markets

IOSCO published a report that examines the factors affecting liquidity, under stressed conditions, in the secondary corporate bond markets.

June 21, 2019 WebPage Regulatory News
News

FED Publishes Results of the 2019 Stress Tests for Banks

FED published a report presenting results of the Dodd-Frank Act Stress Test (DFAST) exercise for 2019.

June 21, 2019 WebPage Regulatory News
News

BCBS Report Examines Global Pillar 2 Supervisory Review Practices

BCBS published a report that examines the Pillar 2 supervisory review practices and approaches in Basel member jurisdictions.

June 21, 2019 WebPage Regulatory News
News

IASB Publishes Work Plan and Meeting Updates for June 2019

IASB published an updated work plan and a summary of its June meeting, which presents preliminary decisions of the Board.

June 21, 2019 WebPage Regulatory News
News

HKMA Publishes Banking Exposure Limits Code Under Banking Ordinance

HKMA issued a circular to all authorized institutions informing that the Banking (Exposure Limits) Code has been published in the Gazette on June 21, 2019.

June 21, 2019 WebPage Regulatory News
News

OSFI Proposes Guideline on Internal Model Oversight for Insurers

OSFI proposed the draft guideline E-25 on the internal model oversight framework for federally regulated property and casualty (P&C) insurance companies.

June 21, 2019 WebPage Regulatory News
News

EBA Single Rulebook Q&A: Third Update for June 2019

Under the Single Rulebook question and answer (Q&A) updates for this week, EBA published one answer regarding the calculation of institution-specific countercyclical capital buffer rates.

June 21, 2019 WebPage Regulatory News
News

SEC Finalizes Capital and Margin Requirements for Security-Based Swaps

SEC adopted a package of rules and rule amendments to establish capital, margin, and segregation requirements for security-based swaps, under Title VII of the Dodd-Frank Act.

June 21, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3304