Changes from report parliamentary committee draft to plenary report

Added* Regulation (EU) 2019/881 of the European Parliament and of the Council of 17 April 2019 on ENISA (the European Union Agency for Cybersecurity) and on information and communications technology cybersecurity certification and repealing Regulation (EU) No 526/2013 (Cybersecurity Act) (OJ L 151, 7.6.2019, p. 15).’;

RemovedArticle 1 – paragraph 1 – point 54, Article 144b – paragraph 4: deleted / (deleted) / (deleted)

Added(i a) the following point (g) is added:

RemovedThis Article is about supervisors' intervention rights when it comes to liquidity management for an individual company.

Added‘(g) environmental, social and governance risks relating to the investment portfolio and the management thereof. ’

RemovedDirective 2009/138/EC

Added(ii) the following subparagraphs are added:

RemovedArticle 1 – paragraph 1 – point 54, Article 144b – paragraph 5: deleted / (deleted)

Added‘Where insurance or reinsurance undertakings apply the volatility adjustment referred to in Article 77d, their liquidity plans shall take into account the use of the volatility adjustment and assess whether liquidity constraints may arise which are not consistent with the use of the volatility adjustment.

RemovedThis Article is about supervisors' intervention rights when it comes to liquidity management for an individual company.

AddedSupervisory authorities shall ensure that undertakings, as part of their risk management, have strategies, policies, processes and systems for the identification, measurement, management and monitoring of environmental, social and governance risks over an appropriate set of time horizons.’;

RemovedDirective 2009/138/EC

Added(b) paragraph 2a is amended as follows:

RemovedArticle 1 – paragraph 1 – point 54, Article 144b – paragraph 6: deleted / (deleted) / (deleted) / (deleted)

Added(i) the first subparagraph is amended as follows:

RemovedDirective 2009/138/EC

Added– in point (b), point (i) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 54, Article 144c: deleted / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted) / (deleted)

Added‘(i) the sensitivity of their technical provisions and eligible own funds to the assumptions underlying the calculation of the matching adjustment, including the calculation of the fundamental spread referred to in Article 77c(1), point (b);’;

RemovedDirective 2009/138/EC

Added– in point (b), point (iii) is deleted;

RemovedArticle 1 – paragraph 1 – point 58 – introductory part, Article 152b: (58) in Article 152b, paragraphs 1 and 2 are replaced by the following and paragraphs 5 and 6 are added:

Added– point (c) is replaced by the following:

RemovedDirective 2009/138/EC

Added‘(c) where the volatility adjustment referred to in Article 77d is applied, the sensitivity of their technical provisions and eligible own funds to changes in the economic conditions that would affect the risk corrected spread referred to in Article 77d(3).’;

RemovedArticle 1 – paragraph 1 – point 58, Article 152b – paragraphs 1 and 2: 1. EIOPA shall set up and coordinate a collaboration platform to strengthen the exchange of information and to enhance collaboration between the relevant supervisory authorities of the home Member State and the host Member States where an insurance or reinsurance undertaking carries out, or intends to carry out, activities which are based on the freedom to provide services or the freedom of establishment. / (deleted) / (deleted) / (deleted) / 2. The relevant supervisory authorities shall submit to the collaboration platform all information available in relation to the insurance or reinsurance undertaking concerned. That information, including all information received in accordance with Article 35 in relation to actions taken by the relevant supervisory authorities, shall be provided in a timely manner to allow for the proper functioning of the collaboration platform.

Added(ii) the third subparagraph is replaced by the following:

RemovedMakes the collaboration platform in cross-border cases mandatory in order to improve cross-border cooperation.

Added‘Where the volatility adjustment referred to in Article 77d is applied, the written policy on risk management referred to in Article 41(3) shall take account of the volatility adjustment.’;

RemovedDirective 2009/138/EC

Added(c) the following paragraphs are inserted:

RemovedArticle 1 – paragraph 1 – point 58, Article 152b – paragraph 5: 5. Where two or more relevant authorities of a collaboration platform disagree about the procedure or content of an action to be taken, or inaction, in relation to an insurance or reinsurance undertaking, EIOPA shall, at the request of any relevant authority or on its own initiative, assist the authorities in reaching an agreement in accordance with Article 19(1) of Regulation (EU) No 1094/2010.

Added‘2b. Member States shall ensure that insurance and reinsurance undertakings develop specific plans, quantifiable targets, and processes to monitor and address the risks arising in the short, medium, and long-term ESG factors, including those arising from the transition and the process of adjustment to the applicable regulatory objectives towards a sustainable economy in relation to environmental, social, and governance factors, in particular with the objective to achieve climate neutrality by 2050 as set out in Regulation (EU) 2021/1119 (European Climate Law).

RemovedDirective 2009/138/EC

AddedThe targets and measures to address the ESG risks included in the plans referred to in the first subparagraph shall consider the latest reports and measures prescribed by the European Scientific Advisory Board on Climate Change, in particular in relation to the achievement of the climate targets of the Union. Where the undertaking discloses information on ESG matters in accordance with Directive 2013/34/EU the plans referred to in the first subparagraph shall be consistent with the plans referred to in Article 19a or Article 29a of that Directive. In particular, the plans referred to in the first subparagraph shall include actions with regards to the business model and strategy of the undertaking that are consistent across both plans.’;

RemovedArticle 1 – paragraph 1 – point 58, Article 152b – paragraph 6: 6. In the event of disagreement within the collaboration platform and where there are serious concerns about negative effects on policyholders or about the content of an action or inaction to be taken in relation to an insurance or reinsurance undertaking, EIOPA may decide, on its own initiative, to initiate and coordinate on-site inspections. It shall invite the supervisory authority of the home Member State as well as other relevant supervisory authorities of the collaboration platform to participate in those on-site inspections.;

Added2c. By way of derogation, paragraph 2b shall not apply to low-risk profile undertakings.’;

RemovedDirective 2009/138/EC

Added(24) Article 45 is amended as follows:

RemovedArticle 1 – paragraph 1 – point 59, Article 153 – paragraph 1: The supervisory authority of the host Member State may require the information which it is entitled to request with regard to the business of an insurance undertaking operating in the territory of that Member State from the supervisory authority of the home Member State of that undertaking. That information shall be supplied within a reasonable period of time in the official language or languages of the host Member State, or in another language accepted by the supervisory authority of the host Member State.

Added(a) in paragraph 1, second subparagraph, the following points (d), (e) and (f) are added:

RemovedThe issue should be effectively addressed via the collaboration platforms without blurring the line between home/host supervisors.

Added‘(d) consideration and analysis of the macroeconomic situation, and possible macroeconomic and financial markets’ developments, and, upon a reasoned request of the supervisory authority, macroprudential concerns, that may affect the specific risk profile, the approved risk tolerance limits, the business strategy, the underwriting activities or the investment decisions, and the overall solvency needs referred to in point (a) of the undertaking;

RemovedDirective 2009/138/EC

Added(e) consideration and analysis of the activities of the undertaking that may affect the macroeconomic and financial markets’ developments, and have the potential to turn into sources of systemic risk;

RemovedArticle 1 – paragraph 1 – point 60, Article 159a: deleted

Added(f) the overall capacity of the undertaking to settle its financial obligations towards policyholders and other counterparties when those obligations fall due, even under stressed conditions.’;

RemovedThis sort of information should be exchanged as part of the work in the collaboration platform.

Added(b) the following paragraphs 1a and 1b are inserted:

RemovedDirective 2009/138/EC

Added‘1a. For the purpose of paragraph 1, points (d) and (e), macroeconomic and financial markets’ developments shall include, at least, changes in the following:

RemovedArticle 1 – paragraph 1 – point 61 – point b, Article 212 – paragraph 2 – subparagraph 1: For the purposes of this Title, the supervisory authorities shall also consider as a parent undertaking any undertaking which, in the opinion of the supervisory authorities, effectively exercises a dominant influence over another undertaking, including where this influence is exercised through centralised coordination and control, over the decisions of the other undertaking.;

Added(a) the level of interest rates and spreads;

RemovedDirective 2009/138/EC

Added(b) the level of financial market indices;

RemovedArticle 1 – paragraph 1 – point 61 – point c, Article 212 – paragraphs 3 to 6: deleted

Added(c) inflation;

RemovedDirective 2009/138/EC

Added(d) interconnectedness with other financial market participants;

RemovedArticle 1 – paragraph 1 – point 62 – point c, Article 213 – paragraph 3a – introductory part: 3a. In the cases referred to in paragraph 2, point (b), insurance and reinsurance undertakings shall ensure that all of the following conditions are fulfilled: