The introduction of the Solvency II regulatory regime inches closer after the European Parliament voted on Tuesday to adopt Omnibus II, a directive that completes and finalizes the common prudential framework for insurance regulation and supervision in the European Union.
The Omnibus II Directive was drafted to amend some aspects of Solvency II, including the role of the European Insurance and Occupational Pensions Authority (EIOPA) and European Securities and Markets Authority (ESMA) in ensuring a harmonized adoption of the calculation of technical provisions and capital requirements. It also defines to which extent EIOPA and ESMA will be able to introduce technical standards and guidance to develop a single rulebook that would ensure strengthened stability, equal treatment, and lower compliance costs.
"The European Parliament has just taken a very important step toward the introduction of a modern and risk-based solvency regime for the insurance industry in Europe as of Jan. 1, 2016, making it both safer and more competitive," says Michel Barnier, European Commissioner for internal market and services. "This long-awaited and vital reform will finally become a reality."
According to Barnier, the Commission is now preparing the next stage of implementation of Solvency II, the adoption of a Commission Delegated Act containing detailed implementing rules planned for the summer of this year.
EIOPA is working on delivering the regulatory and supervisory framework for the technical implementation of the Solvency II regime from the first day of application, Jan. 1, 2016.
The Solvency II regulation aims to review the prudential regime for insurance and reinsurance undertakings in the European Union and was adopted by the Council of the European Union and the European Parliament in November 2009.
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