The Last Leg of Solvency II Published on April 10, 2015 On the 8th April 2015, the Malta Financial Services Authority (MFSA) issued the Insurance Business (Phasing-in) Regulations, 2015. These Regulations grant the MFSA power to issue approvals or permissions in relation to various matters, including group supervision, prior to the implementation of Solvency II. The Regulations consist of two stages of phasing-in with the matters listed in Regulation 3 coming into force on the 1st April 2015, whereas those listed in Regulation 4 shall apply from the 1st July 2015. Therefore insurance and reinsurance undertakings should consider which of the Solvency II approvals they may wish to use. However, the MFSA decisions or approvals in relation to both phasing-in stages will only become applicable on the 1st January 2016. This process ensures that the necessary approvals/permissions are in place on day 1 of Solvency II. In order to supplement the above phasing-in Regulations, the MFSA has also issued a new Insurance Rule 33. This Rule came into force on the 8th April 2015 and adopts a number of European Insurance and Occupation Pensions Authority (EIOPA) guidelines which relate to the various approval processes and group supervision issues addressed by the Regulations. The majority of these EIOPA guidelines came into force on the 1st April 2015 but some will only become effective on the 1st January 2016. The table below provides a description of the matters addressed in these Regulations and their effective dates. 1st April 2015 1st July 2015 Approval Processes Permissions/Determinations Ancillary Own Funds Deduction of a participation Classification of Own Funds Calculation method of group solvency Undertaking Specific Parameters Determination on equivalence Internal Models Permission to apply rules of Articles 238/239 of the Solvency II Directive to subsidiary undertakings of re/insurance undertakings Duration Based Equity-Risk Sub-Module Determinations when the parent undertaking is outside the Community and there is absence of Equivalence Matching Adjustment to the Relevant Risk-Free Rate Term Structure Application of Transitional Measures Transitional measure on the Risk-Free Interest Rates Transitional measure on Technical Provisions Group Supervision Level and scope of Group Supervision Identification of Group Supervisor Establishment of a College of Supervisors All the relevant documentation can be found by clicking on the headings below: Legal Notice 120 of 2015 Insurance Rule 33 of 2015 – Phasing-in measures for Solvency II Implementation For more information contact Ms Tanya Causon, Regulatory Manager (Insurance), GANADO Advocates. Go back