Financial Services and Markets Act 2000

105 Insurance business transfer schemes

(1) A scheme is an insurance business transfer scheme if it—

(a) satisfies one of the conditions set out in subsection (2);

(b) results in the business transferred being carried on from an establishment of the transferee in an EEA State; and

(c) is not an excluded scheme.

(2) The conditions are that—

(a) the whole or part of the business carried on in one or more member States by a UK authorised person who has permission to effect or carry out contracts of insurance (“the authorised person concerned”) is to be transferred to another body (“the transferee”);

(b) the whole or part of the business, so far as it consists of reinsurance, carried on in the United Kingdom through an establishment there by an EEA firm qualifying for authorisation under Schedule 3 which has permission to effect or carry out contracts of insurance (“the authorised person concerned”) is to be transferred to another body (“the transferee”);

(c) the whole or part of the business carried on in the United Kingdom by an authorised person who is neither a UK authorised person nor an EEA firm but who has permission to effect or carry out contracts of insurance (“the authorised person concerned”) is to be transferred to another body (“the transferee”).

(3) A scheme is an excluded scheme for the purposes of this section if it falls within any of the following cases:

• Case 1

  Where the authorised person concerned is a friendly society.

• Case 2

  Where—

  (a)

  the authorised person concerned is a UK authorised person;

  (b)

  the business to be transferred under the scheme is business which consists of the effecting or carrying out of contracts of reinsurance in one or more EEA States other than the United Kingdom; and

  (c)

  the scheme has been approved by a court in an EEA State other than the United Kingdom or by the host state regulator.

• Case 3

  Where—

  (a)

  the authorised person concerned is a UK authorised person;

  (b)

  the business to be transferred under the scheme is carried on in one or more countries or territories (none of which is an EEA State) and does not include policies of insurance (other than reinsurance) against risks arising in an EEA State; and

  (c)

  the scheme has been approved by a court in a country or territory other than an EEA State or by the authority responsible for the supervision of that business in a country or territory in which it is carried on.

• Case 4

  Where the business to be transferred under the scheme is the whole of the business of the authorised person concerned and—

  (a)

  consists solely of the effecting or carrying out of contracts of reinsurance, or

  (b)

  all the policyholders are controllers of the firm or of firms within the same group as the firm which is the transferee,

  and, in either case, all of the policyholders who will be affected by the transfer have consented to it.

(4) The parties to a scheme which falls within Case 2, 3 or 4 may apply to the court for an order sanctioning the scheme as if it were an insurance business transfer scheme.

(5) Subsection (6) applies if the scheme involves a compromise or arrangement falling within section 427A of the [1985 c. 6.] Companies Act 1985 (or Article 420A of the Companies [S.I. 1986/1032 (N.I. 6).] (Northern Ireland) Order 1986).

(6) Sections 425 to 427 of that Act (or Articles 418 to 420 of that Order) have effect as modified by section 427A of that Act (or Article 420A of that Order) in relation to that compromise or arrangement.

(7) But subsection (6) does not affect the operation of this Part in relation to the scheme.

(8) “UK authorised person” means a body which is an authorised person and which—

(a) is incorporated in the United Kingdom; or

(b) is an unincorporated association formed under the law of any part of the United Kingdom.

(9) “Establishment” means, in relation to a person, his head office or a branch of his.