EIOPA's enhances Cross-Border Cooperation for relocating (re)insurers

The European Insurance and Occupational Pensions Authority (EIOPA) has updated its June 10, 2021, decision on supervisory collaboration. This update includes a new annex focused on cooperation when reinsurance companies relocate within the EU.

The annex aims to ensure a smooth transition for firms moving their registered offices across borders within the Single Market.

It aligns with the ‘Mobility Directive’ (Directive (EU) 2019/2121), which governs such relocations.

The amendment stresses the importance of early and active communication between supervisory authorities in both the departure and destination countries. This proactive stance helps maintain uninterrupted service and consistent supervision for the relocating entity.

The goal is to ensure the structured transfer of supervisory information and safeguard the interests of policyholders and beneficiaries during and after the transition.

EIOPA offers technical assistance and expertise to supervisory authorities during these transitions, especially in complex situations requiring specific guidance.

The ‘Mobility Directive’ enhances the rights of limited liability companies to convert, merge, or divide across EU borders. It prioritizes the protection of employees, creditors, and shareholders.

EIOPA's enhances Cross-Border Cooperation for relocating (re)insurers

These provisions also apply to cross-border conversions of insurance and reinsurance firms.

To ensure seamless implementation in the insurance sector and facilitate supervisory transitions, EIOPA’s supervisory convergence plans include developing tools to aid cooperation between authorities in the relevant countries.

The European Insurance and Occupational Pensions Authority is a regulatory agency of the European Union.

Established in 2010, its primary role is to support the stability of the financial system, ensure the transparency of markets and financial products, and protect policyholders, pension scheme members, and beneficiaries.

EIOPA achieves this by fostering a sound regulatory framework and consistent supervisory practices across the EU insurance and occupational pensions sectors (see Largest Insurance Companies in Europe).

Key functions of EIOPA

  1. Regulatory Development: EIOPA develops regulatory standards and guidelines to ensure a harmonized approach to supervision across EU member states.
  2. Supervisory Convergence: It works to achieve consistent and effective supervisory practices to ensure a level playing field and to protect consumers.
  3. Risk Assessment: EIOPA monitors and assesses risks and vulnerabilities in the insurance and pensions markets, providing early warnings and recommendations for corrective actions.
  4. Consumer Protection: It aims to improve consumer protection by enhancing transparency, simplicity, and fairness in the market for insurance and pensions products.
  5. Crisis Prevention and Management: EIOPA plays a key role in crisis prevention and management, including stress testing and contingency planning for insurance and occupational pensions sectors.

EIOPA operates within the broader framework of the European System of Financial Supervision (ESFS), which includes the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA). Together, these authorities work to ensure the integrity, transparency, and efficiency of the EU financial system.

Yana Keller  by Yana Keller