On Dec. 11, DEN GVT issued an order on transfer of group 1 portfolios.
DEN GVT, via Ministry of Industry and Trade, published a new Executive Order on the transfer of insurance portfolios of group 1 insurance companies, on behalf of DEN FSA,
in order to provide specific clarification on the matter under current terms of Act 718.
The Executive Order applies to full or partial transfer by Group 1 insurance companies of an insurance portfolio, to an insurance company with its registered office in another country in EU or in a country with which EU has entered into financial area agreement.
Requirements apply where the insurance contracts have been concluded through either a branch, or have been provided in form of cross-border services, from external office.
A group 1 insurance company must apply for DEN FSA's permission to transfer all or a specific part of its insurance portfolio, and is subject to the supervisory requirements of the transfer destination in terms of both local consent, and local capital requirements.
If a branch of an insurer wishes to transfer all or part of its insurance portfolio that had been underwritten under the right of free establishment, the supervisory authority in the country where the branch is established must also be consulted, for their consent.
Violation of § 3, subsection 1, and § 4, subsection 1, is punishable by a fine, and legal persons may be held criminally liable under rules in Chapter 5 of the Criminal Code.
Effectiveness
The new Executive Order enters in force on Jan. 1, 2025, and at same time, entirety of Executive Order 818 of Jul. 3, 2015, on transfer of insurance portfolios, is repealed.
