Changes from report parliamentary committee draft to plenary report

Added2a. EIOPA shall evaluate whether and to what extent insurance and reinsurance undertakings assess their material exposure to biodiversity-related risks as part of the assessment referred to in Article 45(1). EIOPA shall subsequently assess which actions should be taken to ensure that insurance and reinsurance undertakings duly consider these risks. EIOPA shall submit a report with its findings to the Commission by 30 June 2024.

Added2b. EBA, EIOPA and ESMA shall, through the Joint Committee referred to in Article 54 of Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010, develop guidelines to ensure that consistency, long-term considerations and common standards for assessment methodologies are integrated into the stress testing of environmental, social and governance risks. The Joint Committee shall publish those guidelines by ... [12 months from the date of entry into force of this amending Directive]. EBA, EIOPA and ESMA shall, through the Joint Committee referred to in Article 54 of Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010, explore how social and governance-related risks can be integrated into stress testing.’

Added* Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (OJ L 198, 22.6.2020, p. 13).’;

Added(91a) the following Article is inserted:

Added‘Article 304b

AddedReview as regards the separation of life and non-life insurance business

AddedEIOPA shall assess whether the requirement on the separation of life and non-life insurance business referred to in Article 73(1) is still justified. In particular, EIOPA shall assess the effects of maintaining and the potential effects of lifting the composite ban with respect to policyholder protection, potential cross-subsidisation between life and non-life activities, market efficiency and competitiveness. For the purpose of the assessment, EIOPA shall take into account the supervisory experiences with composite undertakings. EIOPA shall submit a report with its findings to the Commission by 28 June 2024.’

Added(92) in Article 305, paragraphs 2 and 3 are deleted;

Added(93) Article 308a is deleted;

Added(94) Article 308b is amended as follows:

Added(a) paragraphs 5 to 8 are deleted;

Added(b) paragraph 12 is replaced by the following:

Added’12. Notwithstanding Article 100, Article 101(3) and Article 104, Member States shall ensure that the standard parameters to be used when calculating the market risk concentration and the spread risk sub-modules in accordance with the standard formula shall be the same in relation to exposures to Member States' central governments or central banks incurred before 1 January 2020 and denominated and funded in the domestic currency of any Member State as the ones that would be applied to such exposures denominated and funded in their domestic currency;’;

Added(c) in paragraph 17, the following subparagraphs are inserted after the first subparagraph:

Added‘Where an insurance or reinsurance group, or any of its subsidiary insurance or reinsurance undertakings is applying the transitional measure on the risk-free interest rates referred to in Article 308c or the transitional measure on technical provisions referred to in Article 308d, the participating insurance or reinsurance undertaking, the insurance holding company or the mixed financial holding company shall publicly disclose, as part of its report on the group solvency and financial condition referred to in Article 256, and in addition to the disclosures referred to in Articles 308c(4), point (c), and Article 308d(5), point (c), the quantification of the impact on its financial position of assuming that the own funds stemming from the application of those transitional measures cannot effectively be made available to cover the Solvency Capital Requirement of the participating undertaking for which the group solvency is calculated.

AddedWhere an insurance or reinsurance group materially relies on the use of the transitional measures referred to in Articles 308c and 308d in such a manner that it misrepresents the actual solvency position of the group, even where the group Solvency Capital Requirement would be complied with without the use of those transitional measures, the group supervisor shall have the power to take appropriate measures, including the possibility to reduce the amount of own funds stemming from the use of those transitional measures that may be deemed eligible to cover the group Solvency Capital Requirement.’;

Added(95) Article 308c is amended as follows:

Added(a) the following paragraph 1a is inserted:

Added‘1a. After [OP please insert date = date of application of this amending Directive], supervisory authorities shall only approve a transitional adjustment to the relevant risk-free interest rate term structure in the following cases:

Added(a) during a period of 18 months preceding the approval, the rules of this Directive applied for the first time to the insurance or reinsurance undertaking requesting the approval after being exempted from the scope of this Directive pursuant to Article 4;

Added(b) during a period of six months preceding the approval, the insurance or reinsurance undertaking requesting the approval received authorisation to accept a portfolio of contracts, pursuant to Article 39, where the transferring insurance or reinsurance undertaking applied the transitional adjustment to the relevant risk-free interest rate term structure with respect to that portfolio of contracts prior to the transfer.’;

Added(b) in paragraph 4, point (c) is replaced by the following:

Added‘(c) within the part of their report on their solvency and financial condition consisting of information addressed to other market participants referred to in Article 51(1b), publicly disclose all of the following:

Added(i) the fact that they apply the transitional risk-free interest rate term structure;

Added(ii) the quantification of the impact of not applying this transitional measure on their financial position;

Added(iii) where the undertaking would comply with the Solvency Capital Requirement without application of this transitional measure, the reasons for the application of this transitional measure;

Added(iv) an assessment of the dependency of the undertaking on this transitional measure and, where applicable, a description of the measures taken or planned by the undertaking to reduce or remove the dependency.’;

Added(96) Article 308d is amended as follows:

Added(a) the following paragraph 1a is inserted:

Added‘1a. After [OP please insert date = date of application of this amending Directive], supervisory authorities shall only approve a transitional deduction to technical provisions in the following cases:

Added(a) during a period of 18 months preceding the approval, the rules of this Directive applied for the first time to the insurance or reinsurance undertaking requesting the approval after being exempted from the scope of this Directive pursuant to Article 4;

Added(b) during a period of six months preceding the approval, the insurance or reinsurance undertaking requesting the approval accepted a portfolio of contracts, pursuant to Article 39, where the transferring insurance or reinsurance undertaking applied the transitional adjustment to the relevant risk-free interest rate term structure with respect to that portfolio of contracts prior to the transfer.’;

Added(b) in paragraph 5, point (c) is replaced by the following:

Added‘(c) within the part of their report on their solvency and financial condition consisting of information addressed to other market participants referred to in Article 51(1b), publicly disclose all of the following:

Added(i) the fact that they apply the transitional deduction to the technical provisions;

Added(ii) the quantification of the impact of not applying that transitional deduction on their financial position;

Added(iii) where the undertaking would comply with the Solvency Capital Requirement without application of this transitional measures, the reasons for the application of this transitional measure;

Added(iv) an assessment of the dependency of the undertaking on this transitional measure and, where applicable, a description of the measures taken or planned by the undertaking to reduce or remove the dependency.’;

Added(97) in Article 309(1), the fourth subparagraph is deleted;

Added(98) in Article 311, the second paragraph is deleted;

Added(99) Annex III is amended in accordance with the Annex to this Directive;

AddedAmendment to Directive 2013/34/EU

AddedIn Article 19a of Directive 2013/34/EU, paragraph 6 is replaced by the following:

Added‘6. By way of derogation from paragraphs 2 to 4 of this Article, and without prejudice to paragraphs 9 and 10 of this Article, small and medium-sized undertakings referred to in paragraph 1 of this Article, small and non-complex institutions defined in point (145) of Article 4(1) of Regulation (EU) No 575/2013, captive insurance undertakings defined in point (2) of Article 13 of Directive 2009/138/EC of the European Parliament and of the Council, captive reinsurance undertakings defined in point (5) of Article 13 of that Directive, and low-risk profile undertakings as defined in point (10a) of that Directive may limit their sustainability reporting to the following information:

Added(a) a brief description of the undertaking’s business model and strategy;

Added(b) a description of the undertaking’s policies in relation to sustainability matters;

Added(c) the principal actual or potential adverse impacts of the undertaking on sustainability matters, and any actions taken to identify, monitor, prevent, mitigate or remediate such actual or potential adverse impacts;

Added(d) the principal risks to the undertaking related to sustainability matters and how the undertaking manages those risks;

Added(e) key indicators necessary for the disclosures referred to in points (a) to (d).

AddedSmall and medium-sized undertakings, small and non-complex institutions, captive insurance and reinsurance undertakings and low-risk profile undertakings that rely on the derogation referred to in the first subparagraph shall report in accordance with the sustainability reporting standards for small and medium-sized undertakings referred to in Article 29c.’

Added1. Member States shall adopt and publish, by 30 June 2025, the laws, regulations and administrative provisions necessary to comply with this Directive. They shall immediately communicate the text of those measures to the Commission.

AddedThey shall apply those measures from 1 January 2026.

AddedWhen Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made.

Added2. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

AddedThis Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

AddedThis Directive is addressed to the Member States.

AddedDone at Brussels,

AddedFor the European Parliament For the Council

AddedThe President The President

Added(1) in section A. “Forms of non-life insurance undertaking”, point (27) is deleted;