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The Commission published the long awaited recast version of the Solvency II Directive. The recast follows the structure of the existing (re)insurance Directives. The new Solvency II provisions are therefore introduced in different Chapters and Titles of the draft Directive. No substantive changes have been made to the existing Directives that have been recast except for those changes that are necessary in order to introduce a new solvency regime.
The new solvency provisions are principles based and follow the 4 level structure of the Lamfalussy financial services architecture. The principles will be further developed through implementing measures.
The scope of application of the present Directives has not been changed. However, the present exclusion of small mutual undertakings has been extended to all small insurance undertakings defined in Article 4, regardless of their legal form. The Directive does not apply to pension funds (Directive 2003/41/ECon the activities and supervision of institutions for occupational retirement provision). A review of this Directive will take place in 2008. At that time, the Commission will examine whether and how suitable solvency requirements can or should be developed for pension funds.
Similarly the Directive does not change the regime applicable to financial conglomerates. However, if any issues are identified they will be addressed in the course of the review of the Financial Conglomerates Directive (2002/87/EC) which will take place in 2008.