Following today’s agreement by the EU Council of Economic and Finance Ministers to a general approach on a text of the draft Solvency II Framework Directive that excludes the group support regime, the CEA, the European insurance and reinsurance federation, calls for open and constructive discussions between the Council, the European Parliament and the European Commission to try to reach agreement on a common text.
“We have high hopes that the trialogue between the Council, Parliament and Commission will lead to a compromise on group support so that the text preserves the integrity of the economic risk-based principles that are the raison d’être for Solvency II,” said Michaela Koller, director general of the CEA.The CEA had already expressed disappointment that the text presented to the Council had removed all mention of the group support regime, which allows for the supervision of insurance groups in line with their economic reality. The CEA continues to believe that the group support regime is fundamental to Solvency II, since it allows for the economic assessment of a group’s risk and capital as well as the enhanced coordination of supervisors involved in the group’s oversight.
The European Parliament is due to vote early next year on its draft report that supports group supervision and the group support regime. Adoption of the report, if not coupled with a rapprochement of the positions of the Parliament and Council, would formalise the differences between the text agreed by the Council and the text adopted in Parliament, triggering a second reading.
“Given the different views in Council and in Parliament, it is important that the discussions on the open issues continue and that they are clearly focused on reaching a consensus that reflects the ultimate goals of the proposed regulatory regime and remains broadly in line with the original Commission proposals,” said Koller.