The European Commission has backtracked on plans to grant equivalent status to about a dozen foreign jurisdictions that have started to roll out reforms intended to bring their regulatory regimes up to scratch with the Solvency II.
This threatens to put at a competitive disadvantage insurers doing business outside their home jurisdiction.
In June, the Commission granted Solvency II equivalent status to a group of seven countries, including Canada, Switzerland and the US.
With the exception of Switzerland, which was granted full equivalence, the decisions concerned the calculation of solvency capital requirement (SCR) at group level only, and were rushed-in to support national supervisors in the assessment of internal model applications.
A second set of legislative texts on equivalence was planned for the end of September. But this autumn package, which was intended to expand the first list and to cover the other two categories of equivalence, has been scaled down.
The Commission confirmed last week that it is poised to issue decisions on Japan and Bermuda.
However, it is not taking action on about a dozen other countries that had expressed the intention to get equivalent status and were subject to an analysis by the European Insurance and Occupational Pensions Authority (EIOPA).
The move has taken industry representatives by surprise.
Posted on Thursday Nov 26