The Friendly Societies Act 1992 (Amendment) Regulations 1994

4.  For paragraph 15A of that Schedule (confirmation: long term business) substitute–

“15A.— (1) This paragraph applies to any transfer of engagements (other than contracts of reinsurance) where–

(a) the effecting of the engagements constituted the carrying on of long term business;

(b) the transferor is a friendly society to which section 37(3) above applies; and

(c) the transferee is–

(i) a friendly society to which section 37(2) or (3) above applies;

(ii) a UK company;

(iii) an EC company;

(iv) a non–EC company whose head office is an EFTA State; or

(v) an insurance company whose margin of solvency is required to be supervised in accordance with Article 29 or 30 of the first life Directive.

(2) The Commission shall not confirm the transfer unless–

(a) it is satisfied that the transferee is, or will be immediately after the making of the confirmation–

(i) authorised under section 32 above to carry on, or

(ii) authorised under section 3 or 4 of the Insurance Companies Act 1982 to carry on, or

(iii) authorised in accordance with Article 6 of the first life Directive to carry on in an EEA State other than the United Kingdom,

long term business of the class or classes to be transferred;

(b) the relevant authority certifies that the transferee possesses the necessary margin of solvency after taking the proposed transfer into account; and

(c) where the establishment from which the policies are to be transferred is situated in a member State other than the United Kingdom, the Commission is satisfied–

(i) that the supervisory authority in that member State has been consulted about the proposed scheme; and

(ii) either that the authority has responded or that the period of three months beginning with the consultation has elapsed.

(3) Where, as regards any policy (other than an EFTA policy) which is included in the proposed transfer, a member State other than the United Kingdom, is the State in which the commitment is situated, the Commission shall not confirm the transfer unless it is satisfied–

(a) that the supervisory authority in that member State has been notified of the proposed scheme; and

(b) either that the authority has consented to the scheme or that the authority has not refused its consent to the scheme within the period of three months beginning with the notification.

(4) Where the establishment of the transferee to which the policies are to be transferred is situated in the United Kingdom and, as regards any EFTA policy included in the proposed transfer, an EEA State other than the United Kingdom is the State in which the commitment is situated, the Commission shall not confirm the transfer unless it is satisfied that–

(a) the transferee either fulfils the conditions in Articles 11, 12, 14 and 16 of the second life Directive in that EEA State; and

(b) the supervisory authority in that EEA State agrees to the transfer.

(5) Where the establishment of the transferee to which the policies are to be transferred is situated in an EEA State other than the United Kingdom and, as regards any ETFA policy included in the proposed transfer, an EEA State is the State in which the commitment is situated, the Commission shall not confirm the transfer unless–

(a) where the EEA State in which the establishment is situated is also the State in which the commitment is situated, it is satisfied that the supervisory authority in that EEA State agrees to the transfer;

(b) where the United Kingdom is the State in which the commitment is situated, it is satisfied that the transferee is not precluded by Schedule 2F to the Insurance Companies Act 1982 from covering the commitment; and

(c) where an EEA State other than the United Kingdom or the EEA State in which the establishment is situated is the State in which the risk is situated, it is satisfied that–

(i) the transferee fulfils the conditions in Articles 11, 12, 14 and 16 of the second life Directive in the EEA State which is the State in which the commitment is situated;

(ii) the law of that State provides for the possibility of such a transfer; and

(iii) the supervisory authority in that State agrees to the transfer.

(6) In this paragraph “the relevant authority” means–

(a) if the transferee is a friendly society to which section 37(2) or (3) above applies, the Commission;

(b) if the transferee is a UK company, the Secretary of State;

(c) if the transferee is an EC company, the supervisory authority in its home State;

(d) if the transferee is a non–EC company whose head office is in an EFTA State, the supervisory authority in that EFTA State;

(e) if the transferee is an insurance company whose margin of solvency is required to be supervised in accordance with Article 29 or 30 of the first life Directive, the Secretary of State or other supervisory authority responsible for the supervision.”.