MIL-OSI Europe: Briefing – Insurance recovery and resolution directive – 13-03-2024

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Source: European Parliament 2

In 2020, the Commission launched a review of the Solvency II Directive, the EU’s legal prudential regulatory framework for (re-)insurance companies, which entered into force in 2016. As one output of the review, the Commission made a proposal in September 2021 for a new directive establishing a framework for recovery and resolution of insurance companies – the ‘IRRD proposal’. The IRRD proposal would establish harmonised recovery and resolution tools and procedures, with enhanced cross-border cooperation between national authorities. The proposal adopts the ‘pre emptive’ approach whereby insurance companies must submit plans to the supervisory authorities, which would be given powers to implement resolutions. The proposal also sets out a range of tools for resolutions. In the European Parliament, the Committee on Economic and Monetary Affairs (ECON), in charge of the file, adopted its report in July 2023. Following trilogue negotiations, the co-legislators reached an inter-institutional provisional agreement on 14 December 2023, which the ECON committee approved on 29 January 2024. The next steps include the adoption of the text by the Parliament’s plenary and by the Council. Once adopted, it will be signed by the Council and the Parliament and published in the Official Journal. Third edition. The ‘EU Legislation in Progress’ briefings are updated at key stages throughout the legislative procedure.

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