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Transcript of CEIOPS Annual Report 2010 EIOPA Work Programme … · EIOPA Work Programme 2011 3L3 Annual Report...
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9.3 SupervisoryPractices:PreparationofSupervisorstoImplementSolvencyII........................................................................................... 44
9.4 SupervisoryPractices:PeerReview................................................................... 46 9.5 Staffexchanges....................................................................................................... 46 10 ReviewPanel..................................................................................................................... 48 11 ConsumerProtection..................................................................................................... 50 12 OtherActivities................................................................................................................ 54 12.1 Accounting................................................................................................................ 54 12.2 InternationalRelations.......................................................................................... 54 12.3 RegulatoryDialogues............................................................................................ 54 12.4 CEIOPSConference................................................................................................. 55 12.5 WebSite..................................................................................................................... 57 12.6 Training....................................................................................................................... 57 13 Cross-SectorWork........................................................................................................... 60 13.1 3L3providedinputinpreparingnewEuropeanfinancial
supervisoryframework......................................................................................... 60 13.2 3L3TaskForceonCross-SectorRisks................................................................ 62 13.3 Anti-MoneyLaunderingTaskForce................................................................... 63 13.4 3L3workonFinancialConglomerates............................................................. 64 13.5 InternalGovernance.............................................................................................. 66 13.6 Jointworkonnon-cooperativejurisdictions................................................. 68 13.7 3L3JointTaskForceonPackagedRetailInvestmentProducts(PRIPs).. 68 13.8 FosteringConvergencethrough3L3training............................................... 69 14 EIOPAWorkProgramme................................................................................................ 72 14.1 Introduction.............................................................................................................. 72 14.2 Insurance................................................................................................................... 74 14.2.1 SolvencyII....................................................................................................... 74 14.2.2 GroupissuesunderthecurrentInsuranceGroupsDirective........ 78 14.2.3 Equivalence.................................................................................................... 79 14.3 Occupationalpensions.......................................................................................... 79 14.4 Financialstability.................................................................................................... 80 14.5 Consumerprotection............................................................................................. 82 14.6 Cross-bordercrisismanagementandsolutionandcolleges................... 83 4.6.1 Crossbordercrisismanagement............................................................. 83 14.7 Colleges...................................................................................................................... 85 14.8 Supervisoryculture,convergenceandcooperation.................................... 85 14.8.1 Supervisoryculture...................................................................................... 85 14.8.2 Supervisorypractises.................................................................................. 86 14.9 Furtherareasofwork............................................................................................ 87 14.9.1 Accounting..................................................................................................... 87 14.9.2 Internationalrelations................................................................................ 87 14.9.3 Transition........................................................................................................ 87 A Annexes.............................................................................................................................. 88 A1: CEIOPSroleintheLamfalussyprocedure....................................................... 88 A2: Financialstatements............................................................................................. 89 A3: ListofCEIOPSMembersandObservers.......................................................... 90 A4: ListofAbbreviations.............................................................................................. 95 A5: Endnotes.................................................................................................................... 96
1 ForewordfromtheChairman....................................................................................... 6 2 MessagefromtheSecretaryGeneral......................................................................... 8 3 CEIOPSOverview............................................................................................................... 10 3.1 Introduction............................................................................................................... 10 3.2 ManagingBoard....................................................................................................... 11 3.3 MembersMeeting................................................................................................... 12 3.4 ConsultativePanel................................................................................................... 14 3.5 PermanentCommitteesandExpertGroups.................................................. 15 3.6 CEIOPSSecretariat................................................................................................... 16 3.7 CEIOPSandthePoliticalInstitutions................................................................. 18 3.7.1 CEIOPScontributiontothereformoftheEU
financialsupervisoryarchitecture........................................................... 18 3.7.2 CEIOPSandtheCounciloftheEuropeanUnion............................... 18 3.7.3 CEIOPSandtheEuropeanCommission................................................. 19 3.7.4 CEIOPSandothers......................................................................................... 19 4 EIOPA–thenewAuthority............................................................................................ 20 5 Accountability,TransparencyandConsultation.................................................... 22 5.1 Introduction............................................................................................................... 22 5.2 PublicConsultations............................................................................................... 23 6 Insurance............................................................................................................................. 24 6.1 Introduction............................................................................................................... 24 6.2 SolvencyIIOverview.............................................................................................. 24 6.2.1 StandardFormulaCapitalRequirements............................................. 26 6.2.2 TechnicalProvisions.................................................................................... 27 6.2.3 Valuationofassetsandliabilities(excl.Technicalprovisions)...... 28 6.2.4 OwnFunds...................................................................................................... 28 6.2.5 InternalModels............................................................................................. 29 6.2.6 FifthQuantitativeImpactStudy............................................................. 30 6.2.7 InsuranceGroups......................................................................................... 32 6.2.8 Equivalence.................................................................................................... 34 7 OccupationalPensions.................................................................................................. 36 8 FinancialStability............................................................................................................ 40 8.1 InsuranceStressTest.............................................................................................. 43 9 SupervisoryCulture,ConvergenceandCooperation.......................................... 44 9.1 SupervisoryCultureandConvergence............................................................. 44 9.2 SupervisoryPractices:Mediation....................................................................... 44
TAbLE Of COnTEnTS
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1 fOREWORd fROm ThE ChAIRmAn
frameworkforEuropeanPensions.TheoverarchingobjectivesofthepensionreformswillbetostrengthentheEUinternalmarketforpensionsandtoensurethatpensionsystemsareadequateandsustainable,deliveringsecurityinretirementtomillionsofEUcitizens.Weacknowledgethatpensionsareacomplextopicandvariousimpactsneedtoberecognized.IbelievethatCEIOPS’workhasprovidedtoallofusabetterunderstandingofthedifferentregimesandwillbeofutmostrelevancefortheworktocome.Itssuccessor,EIOPAanditsMembersareasourceofconsiderableexpertiseand information about pensions matters and stands ready to assist the EuropeanCommissioninthisarea.
CEIOPSworkedhardtoexpandcapacities,addexpertiseandinfrastructureandlaidthegroundworktorespondtothenewtasksandpowersunderEIOPA.ThenewAu-thoritywillbediligentinthefieldofcolleges,consumerprotection,crisismanage-mentandwillassumeanenhancedinternationalrole.TheexistingmechanismsforLevel3cooperationwillbeformalizedunderaJointCommitteewiththerighttoiniti-atetheproposalofdraftregulatorystandards,thuscontributingtothecreationofasingleEUrulebook.
TheEUhasputforwardambitiousandcomprehensiveproposalsforreformingfinan-cialsupervision.It’sabravenewworld.Weareready.
GabrielBernardino
Itiswithregretbutalsopridetonotethatthisisthelastannualreportpublishedby CEIOPS, the Committee of European Insurance and Occupational Pensions Su-pervisors.Bythetimeyoureadthesepages,theCommitteehasbeensucceededbyEIOPA,theEuropeanInsuranceandOccupationalPensionsAuthority.Theformationof EIOPA, which is part of the new European System of Financial Supervision, is amilestoneboundtoachieveeffectiveandconsistentregulationandsupervision,tak-ingintoaccountthevaryinginterestsofallMemberStatesandthedifferentnatureoffinancialinstitutions.StrengtheningfinancialsupervisionintheEuropeanUnionhasonemaingoal:tosupportthestabilityofthefinancialmarketsinordertoprotectpolicyholders,pensionschememembersandotherbeneficiaries.
Looking back to 2010, it is probably not surprising that Solvency II again was oneof themainprojects thatabsorbedmuchofourattention.CEIOPS isperhapsbestknownforitscontributionstothisproject,whichhasspannedmuchofCEIOPS’exist-ence,sinceitsfoundationbackin2004.CEIOPScontinuestostronglybelievethatSol-vencyII,asamodernrisk-orientedregime,istheanswertothemainquestionsposedbythecrisis.ButthereisstillmuchtodobeforetheimplementationofSolvencyIIin2013.Iwouldarguethatweshouldfindaprudentbalancedapproachtothecali-brationofcapitalrequirements.ThesecondelementthatIfindfundamentalisthereassessmentofthelevelofcomplexityandfinally,thedevelopmentofappropriatetransitionalmeasures.TheanalysisoftheQIS5exerciseanditsfinalreportwillshedsomelightonthesequestions.AndEIOPAwillplayanactiveroleinassuringthatEUinsurancesupervisorsadoptaconvergentapproachtoSolvencyII.
Ofcourse,SolvencyII isnottheonlyimportantpolicyareainthefieldofEUinsur-ancesupervision.Overthenext12months,wecanexpectotherimportantlegislativeinitiativesfromtheEuropeanCommission,suchasarevisedInsuranceMediationDi-rectiveandproposalsforregulatingthedisclosureandsaleofPackagedRetailInvest-mentProducts.EIOPAwillbereadytocontinuetheworkonthesedifferentsubjects.
AndithasbeenabusyyearforCEIOPSinitsothercoreareaofresponsibility:Occu-pationalPensions.TheEuropeanCommission’sGreenPaperonpensionsmarksthestartofaprocesstomodernizeandfurtherintegratetheregulatoryandsupervisory
Gabriel BernardinoCEIOPSChairmanISP,Portugal
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2 mESSAgE fROm ThE SECRETARy gEnERAL
Convergence has also been of increasing importance in the work of our three Level 3Committees (3L3). To ensure cross-sectoral consistency in the activities of all 3L3Committees,wecoordinatedcloselyintheareaoffinancialconglomeratesandothercross-sectoralmatters.Cooperation,jointworkandregularexchangeofinformationwithitssisterorganizationswillremainacommitmentforCEIOPSanditssuccessorEIOPA.
Wearedelightedtoprovideasummaryofallouractivitiesandachievementswiththisreport.Noneofthisworkwouldhavebeenpossiblewithouttheactiveandvalu-ablesupportofCEIOPS’Members.While2010isthelastformalyearforCEIOPS,IamconfidentthatwewillexperienceasmoothtransitionintoEIOPA.Withastrength-enedteamandthecontinuedsupportofallMembers,EIOPAwillcontinuetoachieveitstargets.
CarlosMontalvoRebuelta
AtCEIOPS,wecompletedanexcitingandeventfulyear.Notonlyhas2010beenanimportant,but–notsurprisingly–averybusyyearwithsignificantemphasisonis-suesofconvergence,financialstabilityandconsumerprotection.Itneededadedicat-ed,diligentandskilledteamtodeliveronthehighexpectationsthatwereputonus.
Throughout2010,wehadthepleasuretohavebeeninvolvedinthetransitiontothenewEuropean InsuranceandOccupationalPensionsAuthority (EIOPA),partof thenewEuropeanSystemofFinancialSupervisorsthatwillassumeallofthetasksandcompetencesofCEIOPS.Toprepareforthisimportantstep,wefirstandforemostin-vestedinfurtherstrengtheningourteamandalmostdoubledthenumberofexpertsintheCEIOPSSecretariat.Anotherimportantcomponentisourtechnology.Weputgreateffortintofurtherdevelopingourinfrastructureandwebsite,whichpositionsuswellforfuturedemands.
OneofthemajorregulatoryprojectsremainsSolvencyII.Whilethisprojectinvolvesmanydifferentaspects,IwouldliketohighlightthefifthQuantitativeImpactStudy(QIS5).BytheendofDecember2010,wehadcompletedthefirstphaseofthestudyandwereproudtoconfirmthatalmost70%ofallinsuranceandreinsurancecom-paniesunder thescopeof theSolvency IIdirectiveparticipated inQIS5.That isanincreasefromthefourthQuantitativeImpactStudythatwasconductedin2008andrepresentsasignificantmarketshare.WeappreciatethebroadparticipationoftheindustrybecausethisisakeyfactortoensurethatcurrentoptionstestedunderQIS5areproperlytakenforward.TheresultsfromQIS5willprovidevaluableinputtohelprefinethecalibrationoftheSolvencyCapitalRequirementstandardformulaaswellastherequirementsfortechnicalprovisionsandownfundsinthelevel2implement-ingmeasures.
IntheareaofConvergence,IwouldliketohighlightthatwedeliveredtotheEuropeanInstitutionstheConvergenceRoadmapfor2010.ThisRoadmapoutlinedthespecificcommitmentsofCEIOPS’CommitteesandWorkingGroups.The2010ConvergenceReporthighlightsthatCEIOPSremainscommittedtothepromotionofsupervisoryconvergenceamongtheMemberStatesoftheEuropeanUnion.
Carlos Montalvo RebueltaCEIOPSSecretaryGeneralDGSFP,Spain
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CEIOPS OvERvIEW
3.2 Managing Board
TheManagingBoardisthebodywithresponsibilityforprogressingCEIOPS’businessbyimplementingtheresolutionspassedbyCEIOPS’Members.Itscompositionunder-went considerable change over the past year. CEIOPS’ Vice Chair Antoine Mantel(France)andManagingBoardmemberTonyHobman(UnitedKingdom)steppeddownfromtheirpositionsinspring2010astheypursuednewopportunitiesatnationallevel.
InJuly2010,CEIOPSMemberselectedDamianJaworski(KNF,Poland)andBillGalvin(TPR, United Kingdom) as new Managing Board members. On the same occasion,Joanne Kellermann (DNB, Netherlands) was elected as CEIOPS’ Vice-Chair. In June2010,MichelFlamee(CBFA,Belgium)wasappointedasCEIOPS’InternalAuditor.
In2010, theManagingBoardmetninetimesandconductedadditional telephoneconferencesinordertoco-ordinateCEIOPS’transitiontoEIOPA,discussregularworkaswellasaddressdemandsatshortnoticefromtheEUpoliticalinstitutions.
FromJuly2010,CEIOPSManagingBoardwascomprisedofthefollowingmembers:GabrielBernardino,Chair(ISP,Portugal);JoanneKellermann,Vice-Chair(DNB,Nether-lands);BillGalvin(TPR,UnitedKingdom);DamianJaworski(KNF,Poland);FlaviaMaz-zarella(ISVAP,Italy)andKaidoTropp(FSA,Estonia).RaffaeleCapuano(COVIP–Italy)hasbeeninvitedtoparticipateinManagingBoardmeetingsonmattersrelatedtotransitiontoEIOPAinhiscapacityastheChairofCEIOPS’ConvergenceCommittee.
3.1 Introduction
The Committee of European Insurance and Occupational Pensions Supervisors(CEIOPS)wasestablishedin2004asa‘Level3’Committeefollowingtheextensionofthesocalled‘Lamfalussyapproach’tothefieldofinsurance,reinsuranceandoccupa-tionalpensions.CEIOPScontinuedtoadvisetheEuropeanCommission,eitherattheCommission’srequestor itsowninitiative in theareasofpreparing implementingmeasures,issueguidelines,recommendationsandstandards.Thepermanentstruc-tureofCEIOPSwasrepresentedbyitsSecretariat,whichassistedtheManagingBoardandWorkingGroupsincarryingouttheirtasks.TheSecretariatalsoactedascoordi-natorinthedialoguewithmarketparticipantsandmaintainsrelationswiththeEu-ropeanCommissionandotherthirdparties.InadditiontoitssupervisoryprojectstheCEIOPSSecretariatwasheavilyinvolvedinpreparingthetransitiontotheEuropeanInsuranceandOccupationalPensionsAuthority(EIOPA),whichsucceededCEIOPSon1January2011.
Flavia Mazzarella(ISVAP,Italy)
Michel Flamee(CBFA,Belgium)
Raffaele Capuano(COVIP,Italy)
Gabriel BernardinoChair(ISP,Portugal)
Bill Galvin(TPR,UnitedKingdom)
Damian Jaworski(KNF,Poland)
Joanne KellermannVice-Chair(DNB,Netherlands)
Kaido Tropp(FSA,Estonia)
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3Frankfurt,26/27January2010
Approvalofconsumerprotectionsurveyoncomplaints
Approvalof2009convergencereportandofthe2010roadmap.
EndorsementofamandateforanOPCworkstreamonPRIPsandpensions.
Frankfurt,29/30March2010
EndorsementofCEIOPSAdviceforLevel2ImplementingMeasuresonSolvencyII:CalibrationoftheMCR;CalibrationoftheHealth-Under-writingRisk;CalibrationoftheNon-LifeUnderwritingRisk.
ApprovalofthedraftQIS5TechnicalStandards
EndorsementofCEIOPSAdviceforLevel2ImplementingMeasuresonSolvencyII:TechnicalCriteriaforAssessing3rdCountries.
ApprovaloftherevisedreportonthefunctioningofCollegesofSupervisors.
ApprovaloftheOPC’sdraftpaperonpracticalissuessurroundingcross-borderactivityofIORPsforsubmissiontotheEuropeanCommission.
ApprovaloftheOPCpolicyoptionspaperonPRIPsandpensionsforsubmissiontotheEuropeanCommission.
ApprovaloftheextensionoftheConsultativePanelmandateuntilEIOPAisinplace.
Tallinn,1/2July2010
Approvalofthe2010updatedreportondevelopmentsinthemarketforcross-borderIORPs.
ApprovaloftheanalysisonringfencingarrangementsinstresssituationsrelatedtoOccupationalPensions.
ApprovalofSolvencyIIreportsaddressingthelevelofpreparationofsupervisors.
ElectionofDamianJaworski(PL)andBillGalvin(UK)asmembersoftheManagingBoard.ElectionofJoanneKellermann(NL)asvice-chairoftheManagingBoard.
Frankfurt,9/10November2010
Approvalofthevariableannuitiesreportforpublicconsultation.
Approvalofthemethodologyonequivalenceassessment.
ApprovalofdraftAdvicetotheEuropeanCommissionontheInsuranceMediationDirective(IMD).
ApprovalofCEIOPS’responsetotheGreenPaperonpensions.
ApprovaloftheOPCreportonManagementOversightandInternalControlsapplicabletoIORPs.
Approvalofasummarynoteoncross-borderIORPs,toaccompanytheearlierpracticalissuespaper,forsubmissiontotheEuropeanCommission.
3.3 Members Meeting
The respective national supervisory authorities in the field of insurance and occu-pationalpensionsineachMemberStateoftheEuropeanUniondesignatedaseniorrepresentativetoparticipateinCEIOPSasMember.CEIOPS’MembersMeetingisitsmaindecision-makingbody.FourMembersMeetingswereheldover thereportingperiod.
Thekeydecisionstakenareoutlinedbelow:
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Association Members Country Proxies CountryMr.GérarddelaMartinièreChairman) FR –
CEA Corinti,Alberto IT –AMICE Bonnet,Yanick FR Pozniak,Gregor ATBIPAR Carty,Paul IE Hough,David UKAEIP Gabellieri,Bruno FR Borgdorff,Peter NLFEE Geib,Gerd DE Ellenbürger,Frank DEGCAE Creedon,Seamus UK Goossens,Karel BEEFRP Ray,Martin UK Peaple,Nigel UKAMICE Kalpala,Asmo FI Paakkanen,Markku FIETUC Lourdelle,Henri FR Klec,Gerald ATEFRP Maassen,Jaap NL Verhaegen,Chris BEBEUC McAteer,Mick UK Fily,Anne FRCROForum Plas,Patricia BE Lempertseder,Robert DE
Seganti,Federica IT –
BusinessEurope Stephens,Jim UK –
CEA Wehling,Axel DE Gladysz,Andrej PL
Working Groups
Consultative PanelSecretariat:SimonaDascálu,
Romania
Managing BoardChair:GabrielBernardino,
PortugalSecretariat:PatrickHoedjes,
TheNetherlands
Members’ MeetingSecretariat:PatrickHoedjes,
TheNetherlands
SecretariatSecretaryGeneral:CarlosMontalvoRebuelta,Spain
Financial Requirements Expert Group (FinReq)Chair:OlafErmert,Germany
Secretariat:PamelaSchuermans,Belgium
Financial Stability Committee (FSC)Chair:PatrickDarlap,Austria(frommid2010)
Chair:KajalVandenput,Belgium(untilmid2010)Secretariat:SandraDesson,TheNetherlands
Occupational Pensions Committee (OPC)Chair:BrendanKennedy,Ireland
Secretariat:TeresaTurner,UnitedKingdom
Committee on Consumer Protection (CCP)Chair:VictorRod,Luxembourg
Secretariat:DavidCowan,UnitedKingdom
Convergence Committee (ConCo)Chair:RaffaeleCapuano,Italy
Secretariat:GiuliaConforti,Spain
Internal Governance, Supervisory Review and Reporting Expert Group (IGSRR)
Chair:JanParner,DenmarkSecretariat:IwonaKrasniewska,Poland
Internal Models Expert Group (IntMod) Chair:PaoloCadoni,UnitedKingdom
Secretariat:JuanLumbreras,Spain
Insurance Groups Supervision Committee (IGSC)Chair:PetraFaber-Graw,GermanySecretariat:PerrineKaltwasser,France
Solvency II
Review PanelChair:MichelFlamée,BelgiumSecretariat:DoraItcheva,Bulgaria
3.5 Permanent Committees and Expert Groups
ToexecuteCEIOPS’ambitiousworkprogramme theCommitteemaintained itsop-erationalstructureunderwhichWorkingGroups,ExpertGroupsandTaskForceswereworkingonaspecificsetofgoals,tasksandresponsibilities.
In2010,CEIOPScontinuedtocoordinateeightWorkingGroups,fourofwhichdealtwith Solvency II-related issues. Four of these eightWorking Groups were so calledPermanentCommittees,whoworkedonareasagreedbyCEIOPSMembers.TheotherfourWorkingGroupswereso-calledExpertGroupsthatwereusuallyinchargeofataskunderaspecificmandateandareusuallydisbandedonceitstasksareaccom-plished.Respectively,theChairofCEIOPSConvergenceCommittee(ConCo),RaffaeleCapuano,informedCEIOPSMembersinDecember2010thattheConCoCommitteehadcompleteditsmandateandsuggestedtoclosedownthecommittee.
3.4 Consultative Panel
CEIOPS’ConsultativePanelplaysanessential role inensuring theCommittee’sac-countabilityandtransparency,andisavaluablesourceofimpartialcomment,adviceandguidanceonCEIOPS’policy-makingprocess.
In2010,theConsultativePanelcontinuedtoprovideCEIOPSandtheEUpoliticalin-stitutionswithvaluableandtimelyinputintothetwolargesttopicsofdebate,name-ly: the reform of European financial supervision including transition to EIOPA andtheSolvencyIIdirectiveincludingQIS5,whichwasthelargestprojectundertakenbyCEIOPSin2010.
ThecompositionofthecurrentConsultativePanelwasapprovedbyCEIOPSMembersinMarch2008foratermoftwoyears.InpreparationforthetransitiontothenewEuropeanInsuranceandOccupationalPensionsAuthority(EIOPA),CEIOPSMembersdecidedintheirMarchMeetingtoextendtheexistingmandateuntiltheformales-tablishmentofthenewAuthority.
InApril2010,Mrs.KristieKaneparoresignedfromtheConsultativePanelandwasre-placedbyherproxyMr.AlbertoCorinti.BothMrs.KaneparoaswellasMr.CorintiwerenomineesendorsedbytheEuropeanInsuranceandReinsuranceFederation,CEA.
AttheendofDecember2010,thecompositionoftheConsultativePanel,chairedbyMr.GérarddelaMartinière,wasasfollows:
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3.6 CEIOPS Secretariat
AtthecentreoftheorganisationalstructureofCEIOPSwasitsSecretariat.TheSecre-tariatprovidedsupportandinformationtoCEIOPS’MembersandassiststheManag-ingBoardandtheWorkingGroupswiththeirduties.TheSecretariat’sexpertsalsocoordinatedreportsandcommunications,dialogueswithmarketparticipants,con-sumersandrespondedtorequestsfromtheEuropeanCommissionandparticipatedinexpertgroupsontheEuropeanlevel.
InpreparationforthetransitiontoEIOPA,theCEIOPSSecretariatgrewfrom16teammembersattheendof2009to28by31December2010.
Teamof31December2010
Management: Carlos Montalvo Rebuelta (Secretary General, DGSFP, Spain), PatrickHoedjes (Deputy Secretary General, DNB, Netherlands, replacing Gerlinde Taurer,FMA,Austria,whowasDeputySecretaryGeneraluntil31March2010).
Team: GiuliaConforti(Spain),CatherineCoucke(Belgium),DavidCowan(FSA,UnitedKingdom), Simona Dascalu (Romania), Sandra Desson (DNB, Netherlands), FatimaDiagoVillescas (Spain), Gerd Fassauer (Germany), Sylvia Geiger (Germany), Dora Il-tcheva(Bulgaria),PerrineKaltwasser(ACP,France),CristinaKluge(Germany),StefanKnapp(Germany),DeborahKrapf(UnitedKingdom),IwonaKrasniewska(Poland),JarlKure(Finanstilsynet,Denmark),TanjaLeimbach(Germany),LayPengLim(FSA,UnitedKingdom) Juan Lumbreras (DGSFP, Spain), Kerstin Maier (Germany), Sophia Milili-Makrydakis (Greece), Daniel Perez (DGSFP, Spain), Sybille Reitz (Germany),TilmannRoth(Germany),PamelaSchuermans(Belgium),TeresaTurner(TPR,UnitedKingdom),Pierre-JeanVouette(ACP,France).Patrick Hoedjes
(DeputySecretaryGeneral,DNB,Netherlands)
NEW
NEWNEW
Kerstin Maier(Germany)
Juan Lumbreras(DGSFP,Spain)
Stefan Knapp(Germany)
Sybille Reitz(Germany)
David Cowan(FSA,UnitedKingdom)
Catherine Coucke(Belgium)
Jarl Kure(Finanstilsynet,Denmark)
Simona Dascálu(Romania)
Sandra Desson(DNB,TheNetherlands)
Perrine Kaltwasser(ACP,France)
Pamela Schuermans(Belgium)
Carlos Montalvo Rebuelta(SecretaryGeneral,DGSFP,Spain)
Teresa Turner(ThePensionsRegulator,UnitedKingdom)
Giulia Conforti(Spain)
Tilmann Roth(Germany)
Gerd Fassauer(Germany)
Tanja Leimbach(Germany)
Deborah Krapf(UnitedKingdom)
Pierre-Jean Vouette(ACP,France)
Sophia Milili-Makrydakis(Greece)
Daniel Ortiz Perez(DGSFP,Spain)
Sylvia Geiger-Cludts(Germany)
Iwona Krasniewska(Poland)
Fatima Diago Villescas(Spain)
Dora Iltcheva(Bulgaria)
Lay Peng Lim(FSA,UnitedKingdom)
Cristina Kluge(Germany)
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3.7 CEIOPS and the Political Institutions
3.7.1CEIOPScontributiontothereformoftheEUfinancialsupervisoryarchitectureUnsurprisingly, the reform of the EU financial supervisory architecture has beenat theforefrontofCEIOPS’activitiesduring2010,not leastbecauseCEIOPSwas inchargeoftherotationalco-ordinationof3L3activitiesfrom1July2010until31De-cember2010.Together with theother LamfalussyLevel 3Committees –CESRandCEBS–CEIOPSactivelyfollowedandco-ordinated,wherenecessary,developmentsinrelationtotheproposalssettingupthenewEuropeanSupervisoryAuthorities(ESAs).
Inthisrespect,theLevel3ChairsandtheirrespectiveSecretaryGeneralsandSecre-tariatsregularlyconvenedconferencecalls,exchangedbriefingsandmetonseveraloccasions in advance of meetings with the EU political institutions. Several meet-ingswereheldduring2010withEuropeanCommissionerforInternalMarketsandServices,MichelBarnier,theChairwomanoftheEuropeanParliament’sEconomicandMonetaryAffairsCommittee,SharonBowlesandthePresidentoftheEuropeanCen-tralBank,Jean-ClaudeTrichet.
TheLevel3Committeesalsoprovidedinputintothepoliticalprocessbysubmittingon18June2010adetailedpapertotheEUpoliticalinstitutionsinvolvedinthetri-loguediscussionsoutliningtheirspecificconcernsonthebasicquestionsoftheclearassignmentofresponsibilitiestotheESAs,theiraccountabilityandtheirindepend-ence.
CEIOPSalsoworkedintensivelywithitssistercommitteesoverthepastyearinpre-paringfor thetransitiontotheESAs.Thishas involvedregularcommunicationbe-tweenthethreeCommitteesoveravarietyoftopicssuchasinternalgovernanceoftheESAs,enhancedco-operationwiththeEuropeanSystemicRiskBoard(ESRB),crisismanagementpowers,humanresourcesandbudgetaryissuesandtherulesofproce-dureoftheso-calledJointCommitteeoftheESAs.
3.7.2CEIOPSandtheCounciloftheEuropeanUnionThroughout2010,CEIOPSregularlyattendedthemeetingsoftheFinancialServicesCommittee(FSC)andwasinvitedtoattendmostmeetingsoftheEconomicFinancialCommittee(EFC)inordertodiscussissuessuchasfinancialmarketdevelopments,crisismanagement(e.g.stresstesting)andinternationalregulatorydialogue.
TogetherwiththeotherLevel3Committees,CEIOPSsubmittedtotheEFC-FinancialStabilityTableof20/21September2010asectoralriskreport togetherwitha3L3cross-sectoralriskscovernoteandanupdatereporton3L3Members’experienceofnonco-operativejurisdictionswithintheirregulatory/supervisorycompetencies
3.7.3CEIOPSandtheEuropeanCommission2010wasayearofverycloseco-operationandco-ordinationofeffortswiththeEu-ropeanCommission,particularlyonLevel2adviceonimplementingmeasuresunderSolvencyII,includingrunningthefifthQuantitativeImpactStudy(QIS5)betweenJulyandNovember2010.Therewasalsoextensivereportingonfinancialstabilitymat-tersandconsumerprotectionissuesintheinsuranceandoccupationalpensionssec-tors,aswellasspecificreportingonissuesaffectingoccupationalpensionsintheEU.
3.7.4CEIOPSandothersAsinpreviousyears,in2010,CEIOPS’Chair,ManagingBoard,WorkingGroupChairs,SecretariatandMemberdelegates,continuedtorepresentCEIOPSatvariouseventsinEuropeandinternationally.ThisinvolvedspeechesandpresentationatofficialEUpublic hearings, various industry conferences, seminars and receptions, as well asdialogueswiththirdcountrycounterparties.ThedemandforCEIOPS’contributiontotheseeventshascontinuedtogrowsincelastyear.
EIOPCEuropean Insurance
and OccupationalPensions Committee
EBCEuropean Banking
Committee
FFCEuropean Financial
ConglomeratesCommittee
ESCEuropean Securities
Committee
CEIOPSCommittee of
European Insuranceand Occupational
Pensions Supervisors
CEBSCommittee of
European BankingSupervisors
CESRCommittee of
European SecuritiesRegulators
Regulators “Level 2” Committees
Regulators “Level 3” Committees
“3L3”Fi
nanc
ial S
ervi
ces
Economic & Financial
Com
mitt
ee
Committee
Council W
orking Groups Parliament Com
mitt
ees
Co
uncil
of Ministers European Parliam
ent
(E
COFIN)
EuropeanCommission
20/21
4 EIOPA is commissioned to monitor and identify trends, potential risks and vulner-abilitiesstemmingfromthemicro-prudentiallevel,acrossbordersandacrosssectors.
Toachieveitsambitiousgoals,EIOPAwasestablishedasanAuthoritywithownlegalpersonalityaswellasadministrativeandfinancialautonomy.EIOPAisanindepend-entadvisorybodytotheEuropeanParliamentandtheCounciloftheEuropeanUnion;itsChairpersonandExecutiveDirectorare independentexecutives.Underthenewumbrella,EIOPAcandevelopdraftregulatoryand implementingtechnicalstandardsandissueguidelinesandrecommendationsontheapplicationofEUlaw;itcanrequirenational supervisory authorities to take specific actions to remedy an emergencysituationandsettledisagreementsincross-bordersituationsbetweenauthorities.
Toaccountforthespecificconditionsinnationalmarketsandthenatureoffinancialinstitutions,theEuropeanSystemofFinancialSupervisorsisanintegratednetworkofnationalandEuropeansupervisoryauthorities thatprovidesthenecessary linksbetweenthemacro-andmicro-prudential levels, leavingday-to-daysupervisiontothenationallevel.EIOPAisgovernedbyitsBoardofSupervisors,whichintegratestherelevantnationalauthoritiesinthefieldofinsuranceandoccupationalpensionsineachMemberState.ItisfurtherdirectedbyitsManagementBoard,whichcomprisessixmembersoftheBoardofSupervisorsandEIOPA’sChairperson.
DuetoitsstatusasanagencyoftheEuropeanUnion,EIOPAwillfurtherenhanceitsorganisationandinfrastructuretorespondtoincreaseddemandsfortransparency,accountabilityandpolicywork.Measuresincludestaffdevelopment,investmentintechnology,furtherimprovementtothefunctionalityofthewebsiteandevaluatingthecreationofdatabasesanddocumentservices.
EIOPA’s tasks and responsibilities are defined in the Regulation 1094/2010ofNovember2010.
ThisisthelastannualreportpresentedbytheCommitteeofEuropeanInsuranceandOccupational Pensions Supervisors. On 1 January 2011, CEIOPS was replaced by theEuropeanInsuranceandOccupationalPensionsAuthority.EIOPAwasestablishedinconsequenceofthereformstothestructureofsupervisionofthefinancialsectorintheEuropeanUnion.EIOPAispartoftheEuropeanSystemofFinancialSupervisorsthatcomprises threeEuropeanSupervisoryAuthorities,onefor thebankingsector(EBA), one for the securities markets sector (ESMA) and one for the insurance andoccupationalpensionssector (EIOPA),aswellas theEuropeanSystemicRiskBoard(ESRB)andthenationalsupervisoryauthorities.
WhileEIOPAwillcontinuetobeconcernedwithsupportingthestabilityofthefinan-cialsystemaswellastransparencyofmarketsandfinancialproducts,theAuthoritywillhaveenhancedtasks,powersandstructures.Inthemeantime,allexistingCEIOPStasksandcompetencieswillbetransferredtoEIOPA,andongoingworkandprojectswillbecontinued.Toachievetheobjectivesasdefinedintheregulation,EIOPA’smaingoalscanbesummarizedasfollows:●Betterprotectingconsumerssuchaspolicyholders,pensionschememembersand
beneficiaries.●Improvingthefunctioningoftheinternalmarketaswellasensuringtheintegrity,
transparency,efficiencyandorderlyfunctioningoffinancialmarkets.●Ensuringahigh,effectiveandconsistentlevelofregulationandsupervisiontaking
accountofthevaryinginterestsofallMemberStatesandthedifferentnatureoffinancialinstitutions.
●Greaterharmonisationandcoherentapplicationofrulesforfinancialinstitutions&marketsacrosstheEuropeanUnion.
●Ensuringthattakingonriskrelatedtoinsurance,reinsuranceandoccupationalpensionsactivitiesisappropriatelyregulatedandsupervised.
●Strengtheningoversightofcross-bordergroups.●PromotingcoordinatedEuropeanUnionsupervisoryresponse.
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5.2 Public Consultations
SomeoftheCEIOPSactivitieswithintheareaofpublicconsultationwereinitiatedin2009andcontinuedin2010.ThenewconsultationactivitiesthatCEIOPSstartedthroughout2010wererelatedtoSolvencyII.
InJanuary,CEIOPSissuedtwomoresetsofLevel2adviceonimplementingmeasuresunderSolvencyII,aswellasacomprehensivebackgrounddocumentonthecalibra-tionofthestandardformula.Inthesamemonth,aconsultationpaperwasissuedonthepre-applicationprocessforinternalmodelsfollowedbyareportincludingfinalguidanceinMarch.InJuly,CEIOPSissuedaconsultationpaperonequivalenceassess-mentinrelationtoarticles172,227and260oftheSolvencyIIDirective,followedbytheAdvicetotheEuropeanCommissionendofAugust.InSeptember,theconsulta-tion paper about the methodology for equivalence assessments under Solvency IIwasissuedfollowedbyafinaldocumentinNovember2010.Wherenecessary,CEIOPShasalso initiated informalpre-consultationswithselectedstakeholders, to informthemaboutongoingworkonSolvencyII;thepre-consultationswillbefollowedbypublicconsultations.
5.1 Introduction
TransparencyandaccountabilityareimportantfeaturesforCEIOPSandbothmeas-uresarestronglyaligned.TransparencyandaccountabilitysupportCEIOPS’commit-menttoachievetheoverallgoalsofstrengtheningthefinancialsystembyharmoniz-ingmarketsandapplyingacommonrulebook.AchievingthesegoalswillultimatelyservethecitizensoftheEuropeanUnion.
CEIOPS’accountability isensured throughdifferent tools.Oneof themain instru-ments for CEIOPS is peer reviews, conducted by the CEIOPS Review Panel that ismandatedtohelpmonitoringtheimplementationofsupervisoryprovisionsandtomonitorconvergenceinsupervisorypractices(seechapter10).Additionally,CEIOPSsupportedtheConsultativePanel,whichisavaluablesourceofcomment,adviceandguidanceonCEIOPS’policymakingprocess(seechapter3.4).Thisstrongtoolissup-portedbypublicconsultationsthatareconductedtoensureimplementationoftheviewsandconcernsofallstakeholders.
InadditiontotheConsultativePanelandpublicconsultations,CEIOPS’annualcon-ferenceprovidestheopportunityforexchangeofopinionwithvariousstakeholders(seechapter12.4).Anessentialtooltoaccesstheextensivescopeofinformationisthewebsitethathasbeencompletelyoverhauledandwasre-launchedattheendof2010.
ACCOunTAbILITy, TRAnSPAREnCy And COnSuLTATIOn
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6.1 Introduction
CEIOPS’workoninsurancewasinfluencedtoaverylargeextentbytheSolvencyIIproject.Nevertheless,variousotherimportantareasofworkrelatingtotheinsurancesectorareunderwayandhaveprogressedin2010.Inthisrespect,CEIOPS’adviceontherevisionoftheInsuranceMediationDirectiveaswellasitsrecommendationsontheCommission’sWhitePaperonInsuranceGuaran-teeSchemesshouldbehighlighted1.CEIOPShasalsobeeninvolvedinthediscussiononthelegalframeworkforPackagedRetail InvestmentProducts (PRIPs)onasectoralandcross-sectoralbasis,onwhichmoredetailscanbefoundinthefinalreport2.Finally,theworkoninsurancegroupsupervision also carries forward the initiatives on harmonising group supervision,whichstartedwellbeforetheinceptionoftheSolvencyIIproject.
6.2 Solvency II Overview
Sincethefirstdiscussionsinearly2000,SolvencyIIhasgrowntobecomeoneofthemostambitiouslegislativeprojectscurrentlyintheEuropeanUnionandoneofthecoreareasofworkforCEIOPSsinceitscreation.In2010,CEIOPSdelivereditsfinalsetofadvicetotheEuropeanCommissiononhowtoimplementtheSolvencyIIDirec-tive,followingthreeearliersetsofadviceinthecourseof2009and2010,covering
over50areasforimplementingmeasures.Astheimplementationdeadlineof31De-cember 2012 approaches, the discussions on the details of the measures that willregulatesupervisoryreviewandtheriskmanagementofundertakingshavebecomemoreintenseandreacheditspeakin2010.
Heateddiscussionshave takenplace in thecourseof2010on issuesconsideredofimportance by undertakings and supervisors.The exchange of views and coopera-tionwiththeindustryinmanysensitiveareashastakenplaceinvarioustaskforces,aimingatpragmaticandsensiblesolutions,togetherwiththeEuropeanCommission.The following task forceswerecreated:TaskForceon the IlliquidityPremium, JointWorkingGrouponNon-LifeCalibration,HealthTaskForce,CatastropheScenariosTaskForce.Inaddition,ajointproposalforthecalculationofprofitsarisingoffuturepremi-umsforQIS5waselaborated.Thesejoinedeffortshaveproventobeefficientinreach-ingconclusions,butalsoinincreasingtheunderstandingbetweenundertakingsandsupervisors.Thisvaluabledialoguewillbecontinued,alsobeyondtheentryintoforceofSolvencyII.
ThepreparationandexecutionofthefifthQuantitativeImpactStudy(QIS5)in2010markedthemomenttotesttheproposalselaboratedbyCEIOPS,theEuropeanCom-missionandindustryonaEuropean-widelevel[seechapter6.2.6].TheresultsofQIS5
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willallowtheEuropeanCommissiontotakeinformeddecisionsonthedetailsoftheregulation.TheexercisewillalsohelpsupervisorstodetectwhereincreasedeffortsneedtobemadebeforeSolvencyIIbecomesoperational.
ThetransitiontoEIOPAinJanuary2011playsanimportantroleinrealisingthepo-tentialforconvergentapplicationofSolvencyII.EIOPAhasthetasktodraftbindingtechnicalstandardsfortheimplementationofSolvencyIIandwillplayanimportantroleinthereviewoftheimplementationoftheregulationbyMemberStates.WhereSolvencyIIputsthebasisfortheeffortsoftheEuropeansupervisorycommunitytoimprovegroup-widesupervisionof(re)insuranceundertakings,EIOPAwillbeabletofurtherstimulatethisbyassistingsupervisorsintheappointmentofthegroupsu-pervisor, or by acting as a mediator in cross-border disputes between supervisors.FacingthechallengeofSolvencyII,thenewAuthorityaimstobeaunifyingandsta-bilisingfactor.
FactsaboutSolvencyII●Newregulatoryframeworkprovidingsupervisorswiththeappropriatetoolstoas-
sesstheoverallsolvencyofinsuranceandreinsuranceundertakingsthroughquan-titativeandqualitativemeasuresthatinfluencetheunderstandingandtheman-agementoftherisksoftheundertakings.
●Basedonthreepillars:quantitativerequirements(PillarI),governance,riskmanage-mentandsupervisoryreview(PillarII)aswellassupervisoryreportingandpublicdisclosure(PillarIII).
●Level1FrameworkDirectivepublishedon17December2009.●Level2implementingmeasuresunderdiscussionwithEuropeanCommissionand
MemberStatessinceend2009.●Level3non-bindingguidelinestoensuretheconvergentapplicationoftheregula-
tiontobeissuedbyCEIOPS.●Level3bindingimplementingtechnicalstandardstobedraftedbyCEIOPSanden-
dorsedbytheEuropeanCommission.●EntryintoforceofSolvencyII:1January2013
6.2.1StandardFormulaCapitalRequirements2010hasbeencrucialforthetranslationoftheSolvencyIIadviceonPillar1issuesintothetechnicalspecificationsforthefifthQuantitativeImpactStudy(QIS5),whichincludednewsimplifications,rulesontheclassificationandeligibilityofownfunds,standardisedcatastrophescenariosfornon-lifeandhealthunderwritingrisk,anewmethodologytodeterminetheinterest ratecurvefordiscountingtechnicalprovi-sionsandalsorevisedcalibrationandcorrelationparametersfor theSCRstandardformula.
CEIOPSpublishedinApril2010,togetherwithitsfinaladviceforLevel2implement-ingmeasuresonthecalibrationoftheminimumcapitalrequirementandofunder-writingrisksinnon-lifeandhealthinsurance,anexhaustivecalibrationpaperwhich
isthemainsupportingdocumentforitsadvice.Thecalibrationpaperprovidesback-ground information and compiles all the technical analysis carried out by CEIOPSincalibratingtheSolvencyCapitalRequirement (SCR)standardformula,aswellaskeyparametersforthecalculationoftheTechnicalProvisions.OnekeyareainwhichCEIOPS undertook further work was the calibration of the non-life underwritingrisk module, where CEIOPS launched a European-wide data request in September2010andsetupaJointWorkingGrouptodiscussthemostappropriatecalibrationmethodologies togetherwith representatives from the industryand theEuropeanCommission.TheresultsofthisexercisewillfeedintotherecommendationsfortheEuropeanCommission’simplementingmeasuresinMarch2011.
AjointTaskForcecomposedofCEIOPSMembersandindustryrepresentativesprovidedthe European Commission with input and guidance on the calibration and appli-cationofnon-lifeandhealthcatastrophestandardisedscenarios.TakingintoaccounttheQIS5results,CEIOPSsuccessorEIOPAwiththesupportoftheindustrywillaimtorefineitsrecommendationstotheEuropeanCommissioninMarch2011.
6.2.2TechnicalProvisionsIn 2010, CEIOPS provided important advice on a key assumption underlying thecalculationoftechnicalprovisions:theinterestratecurvetobeusedfordiscounting.CEIOPSprovided theEuropeanCommissionwith technicalbackgroundon the riskfree interest rate term structure. Furthermore, CEIOPS published the report of theTaskForceontheliquiditypremium,whichwasdevelopedincooperationwithCEIOPSMembers, industry and academia representatives, and the European Commissionasanobserver.Thisreportcontainedconclusionsontheprinciplestobeappliedincaseoftheinclusionofanilliquiditypremiuminthevaluationofinsuranceliabilitiesandontheprinciplestobeappliedintheextrapolationoftheinterestratecurvefordiscountinginsurancecompanies’long-termliabilitiesbeyondthelastavailabledatapointofsufficientliquidity.
ConsequentlytheEuropeanCommissionhastestedacompletelynewriskfreeinter-estratetermstructureinQIS5comparedtoQIS4,withtheinclusionofanilliquiditypremiumandanewextrapolationmethod,aswellasnewbasicriskfreerate(ad-justedswaprateinsteadofgovernmentbonds)toderivethepointsofthecurveaswasprovidedbytheindustry.
In2010,CEIOPSalsostarteddevelopingEuropeanactuarialguidelines for thepurposeofensuringaconvergentimplementationofSolvencyIIandaharmonisedperformanceoftheactuarialfunctionforthevaluationoftechnicalprovisions.Theseguidelines are being developed in close cooperation with the European actuarialprofession,inparticularwithGroupConsultatif.
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6.2.3ValuationofAssetsandLiabilities(excl.TechnicalProvisions)FollowingCEIOPS’adviceonLevel2implementingmeasureswithrespecttothevaluationofassetsandliabilitiesotherthantechnicalprovisionsandtheworkoftheEuropeanCommissiononadraftLevel2regulation,CEIOPShasconsideredtheimpactandstartedworkingonLevel3guidelinesinthisarea.
6.2.4OwnFundsWithregardtoownfunds,CEIOPSfocusedin2010onclarifyingthecriteriafortheclassificationofownfunds,aswellastheapprovalprocessesforancillaryownfunds.Furtherworkwascarriedoutintheareaofthetreatmentofparticipationsandring-fencedfunds.TheseareasarealsobeingaddressedintheQIS5exercise,whichshouldshedfurtherlightontheremainingproblems.Theexperiencegatheredinthesear-easwillfeedintothedevelopmentofguidelinesorbindingtechnicalstandards,keep-inginmindCEIOPSclearintentiontosafeguardthequalityoftheownfundsinlightof their loss absorbing capacity. Furthermore, in view of the QIS5 exercise, CEIOPScontributedtotheelaborationofsuggestionsfortestinggrandfatheringproposalstosmoothenthetransitiontoSolvencyII.
6.2.5InternalModelsInorder to increasesupervisoryconvergenceandprepare industryandsupervisorsfortheuseofinternalmodelsasanalternativetothestandardformulaunderSol-vencyII,CEIOPShasprovidedsupervisorswithaplatformfortheexchangeofinfor-mationandknowledgeinthisarea.
Intheworkprogrammefor2010CEIOPScommittedtoissueadvicetotheEuropeanCommissiononthetreatmentofpartialinternalmodels.ThisadvicewaspublishedinJanuary2010,andprovideddetailsonhowtheresultsofpartialinternalmodelsmaybeintegratedintothestandardformularesultsforthecalculationoftheSolven-cyCapitalRequirements(SCR).Tofollow-uponthis,CEIOPSsetupataskforcewithitsmainstakeholderswiththegoaltodraftLevel3Guidelinesonthistopic.
CEIOPS’workrelatedtointernalmodelsalsoinvolvedpreparingthedrafttechnicalspecificationsforthefifthQuantitativeImpactStudy(QIS5).
Consultations with stakeholders have provided valuable information to CEIOPS tocarryoutitsworkoninternalmodels.Thisincludedpresentationsbyinsurancecom-panies,consultantsanddesignersofvendormodels.CEIOPShasstartedtoprepareLevel3guidelinesunderSolvencyIIontheapprovalofinternalmodelsaswellastestsandstandardsforinternalmodels.ForsomeprioritizedLevel3guidelines,inpartic-ularontheusetest,statisticalqualitystandards,calibrationapproximations,profitandlossattributionandvalidation,CEIOPSwillconductaninformalpre-consultationattheendof2010andbeginningof2011.
Paolo CadoniIntModChairFSA,UnitedKingdom
Olaf ErmertFinReqChair
BaFin,Germany
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Furthermore,CEIOPSisimprovingtheexpertiseandconvergenceofsupervisoryprac-ticesintheareaofinternalmodels:●Inthefirsthalfof2010CEIOPSpublishedLevel3guidanceonthepre-application
process, which followedCEIOPSfinaladvice to theEuropeanCommission on theinternalmodelapprovalprocess.
●Aspartofthepre-applicationwork-stream,CEIOPShasstartedimplementingini-tiatives to enhance supervisory consistency in the pre-application process acrossEuropeandtoensureadequateco-operationamongsupervisorsintheapprovalofinternal models. In this respect CEIOPS is organizing informal practical meetingsamongsupervisorscurrentlyinvolvedinthepre-applicationprocess.
●CEIOPScontinueditspre-visitsprogrammeduringthefirsthalfof2010todevelopabetterunderstandingaboutcurrentinternalmodelingpracticescurrentlyappliedbyinsurancecompanies.
●CEIOPSalsoprovidedsupporttothedevelopmentoftrainingprogrammesforSol-vencyII,inparticulara3L3seminaron“InternalModelsintheBankingandInsur-anceSectors”inJuneandasectoralseminaronInternalModelsApprovalinOctober(seechapter12.6).
6.2.6FifthQuantitativeImpactStudyThedevelopmentofSolvencyIIregulationisaccompaniedbyregularso-calledQuantitativeImpactStudies(QIS).Theresultsofthefourthstudy(QIS4)werepub-lishedinNovember2008.AfifthQuantitativeImpactStudy(QIS5)hasbeencarriedoutin2010.
BasedonitsfinaladviceforLevel2implementingmeasures,CEIOPSfinalisedthedrafttechnicalspecificationinMarchandtheEuropeanCommissionpublishedthefinalspecificationsinJulyfollowingfurtherconsultationwithMembersStatesandthemainstakeholders.
ThefirstobjectiveofQIS5istoprovideallstakeholderswithdetailedinformationonthequantitative impactoninsurers’andreinsurers’solvencybalancesheets linkedtotheintroductionofthefutureLevel2 implementingmeasuresunderSolvencyIIcomparedtothesituationunderSolvencyI.QIS5alsoallowscheckingthealignmentofthetechnicalspecificationswiththeprinciplesandcalibrationtargetssetoutintheSolvencyIIDirective.
AnotherimportantaimofQIS5wastofosterthepreparationbyinsurers,reinsurersandsupervisorsfortheintroductionofSolvencyIIandtoidentifyareaswheretheirinternalprocesses,proceduresandinfrastructuremayneedtobeenhanced.QIS5wasalsoamilestoneinthedialoguebetweensupervisors,insurersandreinsurerswhilepreparingforthenewsupervisorysystem.
Almost70%oftheundertakingsthatwillbesubjecttoSolvencyIIhaveparticipatedintheexercise,andamanifestincreaseintheparticipationofinsurancegroupshasbeenachieved.
Tofacilitatetheparticipation,CEIOPSpublishedacommontemplateinAugust2010forparticipantstousetoreporttheirresults.ThistemplatewasalsoprovidedforanextensiveQuestion&AnswersprocedureatEuropeanlevelinco-operationwiththeEuropeanCommission–220questionsandanswerswerepublishedonCEIOPS’website.
ThankstothecommitmentofthestakeholdersandnationalsupervisorsduringtheQIS5exercise,Level2implementingmeasureswillberefinedtoensurethatSolvencyIIfinancial requirementsareeffectiveandadequatelydesignedandcalibrated.ThefinalresultsofthestudywillbepublishedinMarch2011.
Jan ParnerIGSRRChair
FSA,Denmark
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6.2.7InsuranceGroupsConsiderableeffortsandresourceshavebeendevotedbyCEIOPS’Members to thesupervisionofinsurancegroups.
CEIOPS’workinrelationto insurancegroupsunderthecurrentregime(SolvencyI)includes initiatives toharmoniseandstreamlinegroupsupervision fornationalaswell as for cross-border groups, and to enhance co-operation between supervisorswithintheCollegesofSupervisors(previouslyknownasCoordinationCommittees).In2010,98 insurancegroupswereinvolvedincross-borderactivitiesthroughtheirsubsidiaries.
In2010,CEIOPSworkrelatedtoinsurancegroupsupervisionwithrespecttoSolvencyIIinvolvedthepreparationoftechnicalspecificationsforQIS5.
CEIOPSiskeentoensuretheproperrecognitionofgroupspecificitieswhereneces-sary.Therefore,CEIOPSLevel3guidelinesonthepre-applicationofinternalmodelsgivesignificantroomforthecooperationwithintheCollegesofSupervisors.Specificgroupexpertisewasalsoappliedindevelopingtheworkonequivalenceandreporting.
Equivalenceassessments,eitherbytheEuropeanCommissionorgroupsupervisors,will play an important role in the supervision of the assessment of the solvency
positionofgroupsundertheSolvencyIIDirective.Thisisalsolinkedtotheincreas-inginvolvementofnon-EEAsupervisorsintheCollegesofSupervisorsofEuropeangroups,whereaholisticviewofthegroupisneeded.
Commonreportingbothatsoloandgrouplevelwillfacilitatethedialogueandex-changeofinformationbetweenthedifferentsupervisorsthatareinvolvedinthesu-pervisionofinsurancegroupsrespectively.
InMarch2010,CEIOPSpublisheditsreportonthefunctioningofCollegesofSuper-visorscovering theperiod2008–mid2009.Thereportprovidesdetailedstatisticson 53 of the most active Supervisory Colleges including those established for thelargestgroups.InNovember2010,CEIOPSreleaseditsReportonFunctioningofCol-legescoveringtheperiod2009–mid2010,whichrevealedthatthemainstrengthsofCollegesarethecooperationandcontactbetweenauthorities,theestablishmentofacomprehensiveviewofthegroupandthehigh-qualitydiscussionsbetweentheAuthorities.Furthermore,CEIOPShasfoundthatalltherespondentsparticipatinginthesurveyfollowtheHelsinkiProtocolandthatCollegesaregenerallyperformingtheirtasksaccordingtotheCEIOPSguidelines.
Theoutcomeofthosetwosurveysshowedthehighdedicationofsupervisorsinsu-pervisingcross-bordergroupswhileacknowledgingroomforfurtherimprovement.
This iswhyCEIOPSmonitored in2010 thefunctioningofCollegesonanon-goingbasis,focusingonspecifictargetssuchasthecreationofjointworkplansforCollegestoimprovesynergiesinCollegesworkandsettingupemergencyplansforColleges.BothtargetsarelikelytobemandatoryrequirementsundertheupcomingSolvencyIIregime.Thesecondtargetisalsoafollow-upofthepublicationofCEIOPS’“Guide-linesonpreparationforandmanagementofafinancialcrisis”inMarch2009.Thosetargets have been particularly monitored on the largest groups and prove to be asuccess.
Finally,indevelopingitsworkoninsurancegroups,CEIOPStakesintoaccountinter-nationaldevelopmentsinthisarea.
Petra Faber-GrawIGSCChair
Bafin,Germany
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6.2.8EquivalenceEndNovember2009,CEIOPSstartedpubliclyconsultingonitsdraftadviceonLevel2implementingmeasureswithrespecttothetechnicalcriteriathatshouldbeappliedwhen assessing third country equivalence under Articles 172, 227 and 260 of theSolvencyIIDirective,i.e.relatedtoreinsurancesupervision,inclusionofrelatedthirdcountry insurance and reinsurance undertakings in the group solvency calculationandgroupsupervision.
Aspartofthatconsultation,CEIOPSheldastakeholdermeetingon7January2010todiscussthedraftadviceandissuesrelatedtothirdcountryequivalencewithmajorstakeholdersfromtheEuropeanUnionaswellasrepresentativesfromthirdcoun-tries.ThepublicconsultationperiodendedatthebeginningofFebruary2010,afterwhichCEIOPSdelivered itsfinaladvice to theEuropeanCommissionat theendofMarch2010.
In July2010CEIOPS initiatedanotherpublicconsultation, followinganewCall forAdvice3bytheEuropeanCommission,onequivalenceassessmentstobeundertakenonthebasisofArticles172,227and260oftheSolvencyIIDirective.ThefinaladvicewasdeliveredtotheEuropeanCommissionbythesetdeadlineofAugust2010.
A third public consultation, this time on the methodology for equivalence assess-mentsunderSolvencyIIwasfollowedbyCEIOPSfinaladviceinNovember2010.
FollowingtheEuropeanCommissionletter4of29October2010,CEIOPSinitiatedtheequivalenceassessmentsoftheSwissandBermudiansupervisorysystemsunderAr-ticle172oftheSolvencyIIDirectivedealingwithreinsurancesupervision,Article227,dealingwiththeinclusionofrelatedthirdcountryinsuranceandreinsuranceunder-takingsingroupsolvencycalculationandArticle260,dealingwiththeequivalenceofthirdcountrygroupsupervision.AsperrequestoftheEuropeanCommission,CEIOPShasalsoinitiatedtheequivalenceassessmentoftheJapanesereinsurancesupervi-sorysystemunderArticle172.
TodeliverontherequestoftheEuropeanCommissionCEIOPSissuedaCallforEvi-dence5on1December2010relevanttotheseequivalenceassessments.CEIOPSin-vitedallinterestedpartiestoprovideinformationandevidenceastotheirexistingexperienceonaspectsoftheimplementationoftheinsuranceregulatoryregimeandsupervisorypracticesinthethreecountriesconcerned.
Secondly,CEIOPScontactedtheSwissFinancialMarketSupervisoryAuthorityFINMA,the Bermuda Monetary Authority (BMA) and the Japan Financial Services AgencyJFSA.Toassesstheirequivalency,CEIOPSsentquestionnairesforcollectinginforma-tionconcerningtheirrespectivesupervisorysystems.
CEIOPSwillcontinueitsequivalenceworkthroughoutthefirsthalfof2011withthegoal todeliverfinaladviceby theendofSeptember2011.Thefinaladviceshouldincludeafullconsultationabouttheassessmentsofthesethreecountries.
Edward ForshawConCoEquivalenceSCChairFSA,UnitedKingdom
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OCCuPATIOnAL PEnSIOnS
CEIOPSworkonoccupationalpensionsin2010continuedtofocusontheexchangeofinformationandsupervisorycooperationinrelationtotheInstitutionsforOccu-pationalRetirementProvision(IORP)Directive.Althoughcross-borderIORPsreceivedafairshareofattention,topicsextendingtonationalIORPsaswellasnon-IORPpen-sionswereconsideredaswell,mainlyasaresponsetoEUwideinitiativesintheafter-mathofthefinancialandeconomiccrisis.
CEIOPS follow up to its 2008 key implementations report6 included: the definitionofcross-borderactivity;thering-fencingofIORPs’assetsandliabilities;supervisoryreportingandinformationtomembersandbeneficiaries.Additionally,CEIOPSWorkProgrammefor2010envisaged:●2010updatetoCEIOPSReportonMarketDevelopments;●analysisoftheconsequencesofthefinancialcrisisonpre-crisissupervisorymeth-
odsandapproaches;●reportoninternalcontrolsinIORPs;and●analysisofrisksfacedbymembersofdefinedcontribution(DC)pensionschemes.
Projectswerealsoundertaken that felloutside the2010workprogramme. TheseincludedaninvestigationintotheimplicationsforpensionsofissuesrelatingtotheEuropeanCommission’sinitiativeonPackagedRetailInvestmentProducts(PRIPs),anupdatetoCEIOPS2009mappingofEUprudentiallegislationapplicabletopensioninstitutionsorschemesintheEuropeanEconomicArea(EEA)forinclusionintheEu-ropeanCommission’sGreenPaperonpensions,andaresponsetotheGreenPaperitself.Progresswasmadeinallareaswithinthereportingyear.
InMarch2010apaperonpracticalissuessurroundingthedifferentinterpretationsofcross-borderactivitywascompleted.AttherequestoftheEuropeanCommissionfurtherworkfollowedtoformulatepolicyoptionsforpossiblesolutionstotheissuesraisedinthepaper.Bothpapers7/8weresenttotheEuropeanCommissioninNovem-ber2010andlatersubmittedforconsiderationtotheEuropeanInsuranceandOc-cupationalPensionsCommittee(EIOPC).
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In January 2010, CEIOPS, on its own initiative, started an investigation into PRIPs-relatedissuesforpensions.ThisfollowedthedecisionbytheEuropeanCommissioninDecember2009toexcludepensionsfromthescopeofitsproposalonPRIPs.Thetask was to shadow developments on non-pension PRIPs at the cross-sector (3L3)LevelaswellasmonitoringEU-widedevelopments.Threesurveyswerescheduled,coveringalltypesofsupplementarypensionplansandproductsintheEEA,whetheroccupationalorpersonal,togatherinformationrelevantforfuturepolicydecisions.AdatabaseofsupplementarypensionplansandproductswillbecompletedinMarch2011.Afinalreportonpre-enrolmentinformationrequirementsforalltheplansandproductscoveredbythedatabasewillbereadyinthemiddleof2011.InJune2011workwillstartonthemappingofsellingpracticesastheyapplytopensions,withareportonfindingsplannedfor theendof2011.Anypolicy recommendations thatmayfollowwillconsidertheoutcomeoftheconsultationonthepensionsGreenPa-perandthescopeofthereviewoftheIORPDirectiveenvisagedforlaterin2011.
CEIOPS’responsetotheGreenPaperwassubmittedtotheEuropeanCommissionon15November201012.
In2011,byfarthebiggestandmosthighprofilepartofEIOPA’sworkintheoccupa-tionalpensionsareawillbearesponsetotheEuropeanCommission’sCallforAdviceonthereviewoftheIORPDirectiveandtherelatedimpactassessment.Atthetimeofwriting,neitherthecontentoftheCallforAdvicenorthetimetablefordeliveryhavebeenconfirmedbytheEuropeanCommission.However,EIOPAstandsreadytoadaptitsresourcesanddrawupdetailedplansforatimelydeliveryofitsadviceassoonastheinformationbecomesavailable.
July2010sawtwopublicationsonpensionsrelatedmatters.Onewasthe2010re-portonMarketDevelopments9,whichtracksoverallactivityanddevelopmentsintheEuropeancross-borderoccupationalpensionsmarketsincetheIORPDirectivecameintoforce.Theotherpublicationwasanissuespaperanalysingtheeffectivenessofring-fencing measures in protecting pension benefits in stress situations (Article16(3)oftheIORPDirective)10.
InNovember2010,aReportonManagementOversightandInternalControlsRulesapplicable to IORPs was published , as a follow up to CEIOPS 2009 Report on RiskManagement.ItwasbasedonasurveyofCEIOPSMembersand,similarlytoitspred-ecessor, it revealedagreatdiversityandcomplexity inMemberStates’approachesand practices. However, certain Europe-wide trends in IORPs internal controls hadalsobeenidentified.
Ananalysisoftheconsequencesofthefinancialcrisisonpre-crisissupervisorymeth-odsandapproachesrelatingtoIORPswascompletedattheendof2010.Giventheexisting differences in the occupational pensions systems of Member States theworkwasundertakenprimarilyforinternalexchangeofinformationpurposes.Theresponses from individual supervisors were mostly specific to the nature of theirownMemberState’ssystems.Broadly,theanalysisrevealedthatsupervisorsreactedpromptlytotheimmediateeffectsofthecrisisonIORPs.Sponsorsusedamixtureofshorttermmeasuresfocusedonthemoreurgentissuesandconcerns,butwerealsotakingintoconsiderationthelongertermimpacts.Ingeneralthesupervisorystruc-turesandtheinternalorganisationremainedlargelyunchanged,althoughtherewasa clear increase in the exchange of information with other supervisory authoritesresponsible for financial stability or for direct or indirect regulation/supervision ofIORPsintheirMemberStates.
ConsideringthegrowingimportanceofDCtypeoccupationalpensionprovision,aninvestigationintorisksfacedbymembersofsuchschemeswasundertakenin thesecondquarter2010.Themappingofrisksatkeystagesofthelifecycleofapartici-patingmemberwascompletedinSeptember2010andanumberofkeyrisksselect-edforfurtheranalysis.ParticularconsiderationisbeinggiventothevariousmethodsusedbyMemberStatestomitigatetheserisks.Afinalreportonfindingsisplannedforthemiddleof2011.
Work on supervisory reporting requirements continued throughout the year withthe aim to analyse the differences among Member States in their supervisory ap-proachesandtoassessanylinksthatmightexistbetweenthesizeandnatureofthemarket, thetypeofasupervisorysystemandtheamountandfrequencyofsuper-visoryinformationrequired.AreportonfindingswillbepublishedintheSpringof2011.WorkoninformationrequirementsincrossborderIORPshasbeendeferredforthetimebeing.
Brendan KennedyOPC-ChairThePensionsBoard,Ireland
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fInAnCIAL STAbILITy
In view of the financial and economic crisis, CEIOPS, since 2008, considerably in-creaseditsemphasison,andresourcesdevotedto,financialstabilitymattersrelatingtotheinsuranceandoccupationalpensionssectors.Workonfinancialcrisisissueswasgivenhighestpriority.ThissectionoutlinesworkcarriedoutundertheCEIOPSworkprogrammefor2010.CEIOPSwasrepresentedinnumerousmeetingsoftheEu-ropeanCouncil’sFinancialServicesCommittee(FSC)andtheEconomicandFinancialCommittee(EFC),includingtheEFC’sFinancialStabilityTable(EFC-FST),anddeliveredvariousreportsandupdatesinresponsetotherequestsoftheseCommittees.
EndofJanuary2010,followingthediscussionattheFSCmeetingheldon20Janu-ary2010inpreparationoftheforthcomingEUdiscussionontheFinancialStabilityBoardpaperonsystemicrisk,CEIOPSpreparedanoteonsystemicriskcomponentsofinsurancebusinessmodelsinwhichitanalysestheinsurancesectorasawhole.CEIOPSMembersconcludedthatinthelatestfinancialcrisistheEuropeaninsurancesectordidnotturnouttobeasourceofsystemicrisk,butinstead,hadcontributedtothestabilityofthefinancialsystemasawhole.However,awide-spreaddisruptionamongstinsurerscouldbeasourceofvulnerabilityforothersectorsofthefinancialsystem.CEIOPSconsideredthattheinterconnectednessoffinancialsectorsandlinksoftheinsurancesectorwiththerealeconomyarecrucialtorecognisingtherelevanceof insurancetosystemicrisk.The“systemicrelevance”ofrisksrelatestocontagionlikelihoodbymeansoftheinterdependenciesinplaceamongst(re)insuranceunder
takingsandwithothermarketplayers.Theselinkageshavedevelopedconsiderablyinthelastfewyears.
InlinewiththemandatefromtheEFC-FST,CEIOPScommittedinitsworkprogrammefor2010to:●bi-annualreportingonfinancialconditionsandfinancialstabilityintheinsurance,
reinsuranceandoccupationalpensionssectors;●deliveryofsectoralriskassessmentasinputtothe3L3reportsoncross-sectorrisks
tofinancialstabilityinEurope;●conductinganEurope-widestresstestexerciseintheinsurancesector;and●monitoringnationalmeasurestakenbysupervisorsinresponsetothecrisis.
Asinpreviousyears,inJune2010,CEIOPSpublishedthefirstofitsbi-annualreports–itsSpringreportonthemainmarkettrendswithintheinsuranceandoccupationalpensionssectors.CEIOPSsecondbi-annualreportpublishedinDecember2010,con-tained theannualassessmentofdevelopments in the insuranceandoccupationalpension sectors, and highlighted financial stability implications and uncertainties.CEIOPSconsidered that the riskshavenot increased in2010but remainatahighlevel.Ononehandmarketvolatilitieshavepeakedagainleadingtonewlyincreasedconcernsaboutpublicdebtandthemacro-economicoutlook.Allinalltherestillis
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Kajal VandenputFSCChairCBFA,Belgium
8.1 Insurance Stress Test
CEIOPSconcludeditsfirstEUwidestresstestinearly2010.Thegoalofthestresstestwas toevaluate theoverall resilienceof the insurancesector to theeconomicandfinancialmarketsenvironmentunderseveralstressscenarios.
CEIOPS presented the findings of its European-wide stress test for the insurancesectortothemembersoftheEUEconomicandFinancialCommittee(EFC)inMarch201013.The exercise included 28 large and important European insurance groups,covering above 60% of premiums of the European insurance market. Participatinginsurance groups were asked to calculate the impact of stresses on their solvencyratiosunderthreescenarios:anadversescenarioandtwoadditionalseverescenarios(adeeprecessionandaninflationscenario).TheresultsindicatedthatthelargeandimportantEuropeaninsurancegroupswouldremainresilienteveninseverescenar-ios.Inallscenarios,theaggregatedlevelofavailablecapitalexceededtheregulatoryrequirements.
InNovember2010,CEIOPSdecidedtoconductanewstresstestandstarteddiscus-sionsontheframeworkattheendof2010.ThistestshouldbebasedontheSolvencyIIframework(asitwasdefinedinQIS5).Resultsofthisstresstestareexpectedmid2011.
InlinewiththenewEIOPAregulation,stresstestswillbedoneincooperationwiththeEuropeanSystemicRiskBoard(ESRB).
uncertaintyonthefuturedevelopments,specificallywithregardtothedevelopmentofinterestratesandassetprices.Ontheotherhand,regardingfinancialmarketcon-ditions,somepositivesignalshademerged,forexamplethenumberofinsurersonnegativeratingwatchdecreased.Thereportalsoconsideredthedevelopmentoftheoccupationalpensionfundssector.TheimpactofthefinancialcrisisontheEurope-anoccupationalpensionsystemhadnotbeenassevereasseen inotherfinancialsectors,asthelongtermnatureoftheliabilitiesaffordssomeprotectioninthisre-spect, and Institutions for Occupational Retirement Provisions (IORPs) had not ex-perienced the liquidity problems seen elsewhere. However, the crisis hit pensionfundsprimarilyintheirroleasinstitutionalinvestorsandhadasignificantimpactonconsumerconfidenceinthosecountrieswhereoccupationalpensionsaccountforalargepartofretirementbenefits.Asfor2010,therecoveryoffinancialmarketsledtorelativelyhighinvestmentreturns,appreciationofassetsandhigherfundingratiosofIORPs.
Inordertorespondtotheneedforregularmonitoringofdevelopmentsandtheim-pactofthecrisisoninsuranceandoccupationalpensionssectors,aswellastoensuretimelinessoftheinformationcontainedinCEIOPSbi-annualreporting,CEIOPSmadeconsiderable improvements to its tools and systems for data collection on invest-mentportfoliosin2010.DuetothesovereigndebtcrisisCEIOPSprovidedananalysisofthediversificationofinvestmentportfoliosofinsuranceandoccupationalpensionfundstoCEIOPSmembersandpoliticalbodies.Portfoliosofinsuranceundertakingsandoccupationalpensionfundsseemingeneraldiversified.
ThetimelinessofCEIOPSdatacollectionimprovedconsiderably throughestablish-ing a representative sample of occupational pension funds and insurance groupsthrough which data was collected through a fast-track method. Furthermore, alsoin 2010, qualitative information on supervisors’ assessment of the main risks andtheirrelevancetotheirmarketsintheforegoneperiodaswellasintheforthcomingperiod,hasbeengatheredthroughregularsurveys.
Inthefallof2010CEIOPSandthepreparatorySecretariatoftheEuropeanSystemicRiskBoard(ESRB)startedtheircooperation.Alsointhefallof2010 twoHighLevelGroupsweresetupbetweenthethreeCommitteesandtheEuropeanCentralBank:ondataexchangeandsystemicrisk.
Asanothercrisisrelatedinitiative,CEIOPSestablishedacrisiscontactlistforitsMem-bersinOctober2008.ThelistcontainscontactinformationforeachMemberandwasregularlyupdatedduring2009/2010andagainwiththeestablishmentofEIOPAinearly2011.FurthermoreMemberswerekeptinformed,throughtheemailalertpro-cedurethatwasestablishedinSeptember2009,onsupervisoryinterventionsinin-dividualcompanies.AcrisismanagementprocedurewassetupinDecember2010incooperationwiththeotherLevel3Committeestoexplaintheprocedures,tasksandresponsibilitiesofEIOPA’sManagementanditsMembersincaseacrisisemerges.
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SuPERvISORy CuLTuRE, COnvERgEnCE And CO-OPERATIOn
9.1 Supervisory Culture and Convergence
CEIOPS fulfilled the commitment made in its work programme 2010 to furtherstrengthenitsfocusonhorizontalactivitiesaimedatdevelopingcommonsupervi-sorypractices–suchasmediationandpeerreviews–andcommonsupervisorycul-ture–suchasexchangeofstaffandtraining(seechapters9.5and12.6)–aspartofitsdrivetoincreasesupervisorycooperationandconvergenceintheinsuranceandoccupationalpensionssectors.
9.2 Supervisory Practices: Mediation
Thescopeofmediationistoresolvepotentialdisputesbetweensupervisoryauthori-tiesinanon-bindingway.ThemediationprocessthathasbeendevelopedbyCEIOPSwastestedinthesecondquarterof2010throughamediationsimulationexercise,whereabroadrangeofCEIOPSMembersvolunteeredtoparticipateandtoperformthespecificrolesinthemediationmechanism.Thefindingsandrecommendationsderived from the simulation exercise have been included in the CEIOPS Report onMediationandwillserveasabasisforthereviewofCEIOPS“Protocolonmediationmechanismbetweeninsuranceandpensionssupervisors”underEIOPA.
9.3 Supervisory Practices: Preparation of Super-visors to Implement Solvency II
InJuly2010CEIOPSendorsedandpublished14areportthatanalysestowhatextentInsuranceSupervisorsarepreparedtoimplementSolvencyII(moreaboutCEIOPSSol-vencyIIworkseechapter6.2).SolvencyIIimplementationisacomplexprocessandthereforeitisessentialtoconcentrateondetailedpracticestopreparesupervisors.ThereportthataimedatidentifyingareasofadditionalworkforMembersandCEIOPS,wastheoutcomeofaquestionnaireconductedamongmembersinApril2010.
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Fromaquantitativepointofview,thenumberofpeopleengagedinstaffexchangeactivitieshasbeenmaintainedduring2010comparedtothepreviousyear.In2010,17peopleparticipatedinasecondmentprogrammeand86peoplefrom24Authori-tieswereengagedinastudyvisit,sixmorecomparedto2009.Inaddition,nationalEuropeansupervisoryauthoritieshavereportedfoursecondmentsand53studyvis-itsinvolvingsupervisoryauthoritiesoutsideoftheEuropeanUnion.
9.4 Supervisory Practices: Peer Review
ThepeerreviewasatoolforsupervisoryconvergencewastestedbyCEIOPSoverthepasttwoyearsinanexerciseassessingtheapplicationofprotocolsforsupervisorycollaboration incross-bordercases (seechapter10).Withregardtooptimisingtheworkonthefuturepeerreviewprojects,in2010therewasanITtoolforself-assess-mentsdeveloped,whichisnowpartoftheEIOPAinternalwebsite.Itwillbeusedfordevelopingself-assessmentsandreportingontheresultsfromrespondents.
9.5 Staff exchanges
AspartofCEIOPS’commitmenttosupportthedevelopmentofcommonsupervisorypractices,CEIOPShasfurtherinvestigatedpotentialspecificactivitiestoencourageMemberstoparticipateinstaffexchangesin2010.
ConsequentlyCEIOPSsupervisoryculturewebpagewasre-designedin2010asasec-tionofanenhancedCEIOPSwebsite.Thenew,friendlierpageincorporatesthelatestITimprovementstofacilitateinteractionswithinCEIOPSonmattersrelatingtostaffexchange,suchastheoverviewofopeningsandincreasedaccessibilityforallmem-berstopostingauthorities.
Raffaele CapuanoConCoChairCOVIP,Italy
Secondments(staff members
involved)
Study visits(staff members
involved)Authorities involved
2007 8(7toCEIOPS)
12 13
2008 16(10toCEIOPS)
67 23
2009 16(10toCEIOPS)
80 23
2010 17(12toCEIOPS)
86 24
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Michel FlaméeReviewPanelChair
CBFA,Belgium
REvIEW PAnEL
InDecember2010,CEIOPS’Review15Panelcompletedthefirstpeerreviewexercise.Thefinalreportsonthepeerreviewdemonstratethatthepeerreviewisaneffectivetoolforsupervisoryconvergence.Themainresultsfromtheexerciseshowthatmostof the Review Panel’s recommendations and explanations to Members have beentakenonboardandimplemented16bytheendofthepeerreview.TheReviewPanelhasidentifiedissuesandgapsintheoverallfunctioningoftheGeneralandBudapestProtocolssomeofwhichhavebeenclarifiedduringthepeerreview;othersrequirefurtheranalysisandshouldbetakenupbytheEuropeanInsuranceandOccupationalPensionsAuthority(EIOPA).
ThepeerreviewexercisestartedinAugust2008andaimedatassistingMembersinimprovingsupervisoryco-operationandenhancing theapplicationof the General,Budapest and Helsinki Protocols17. A full peer review (including the second phase“ReviewbyPeers”)wasundertakenregardingtheGeneralProtocol.TheReviewPaneldecidedtoconductonlyanin-depthanalysisoftheself-assessmentsregardingtheBudapestProtocol,havinginmindtherevisionof theprotocolafter thebeginningofthepeerreview.TheHelsinkiProtocolandrelatedguidelinesarecurrentlybeingrevisedinviewoftheregulatorychangesrelatedtoinsurancegroupsupervisionasaresultofSolvencyII.Therefore,inordernottointerveneintheseregulatorydevelop-ments,theReviewPanelwilldecideonthewayforwardofthereviewprocessassoonastheregulatorychangesarecompleted.
TheReviewPaneliscurrentlyconsideringnewpeerreviewprojectsonthebasisofthefirstpeerreviewexerciseandinlinewiththenewtasksfromtheEIOPARegulation.
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COnSumER PROTECTIOn
2010wasabusyyearforCEIOPSintermsofitsworkonconsumerprotectionmatters.
CEIOPS continued to consider the issue of Packaged Retail Investment Products(PRIPs)bothsectorallyandina3L3context.A3L3TaskForceonPRIPswassetuptoformulateacommon3L3positiononthescopeofPRIPsandtheappropriateprinci-plesforpre-contractualproductdisclosuresandsellingpractices.
TheTaskForcewaschairedbyAnneliTuominen,FIN-FSAandwascomposedofequalnumberofrepresentativesfromCESRandCEIOPS,aswellasexpertsfromCEBSonstructureddeposits.
Fivemeetingswereheldbetween9April2010and10September2010.AfinalreportwassubmittedtotheEuropeanCommission,underajoint3L3Chairscoverletter,on6October2010andpublishedon3L3websiteson12October2010.
TheTaskForcesought,whereverpossible,toformconsensualviewsonthekeyaspectsofPRIPs.However,wherethiswasnotpossible,alternativepositionswereexpressed.TheCommissionpublishedaConsultationPaperonitsproposedlegalframeworkforPRIPsscopeandproductdisclosureon26November2010.DraftlegislativeproposalsarenowexpectedinJune2011.LegislativeproposalsregardingsalesofPRIPs,whichwillbeincorporatedinarevisedMiFIDandIMD,arenotexpecteduntillaterin2011.CEIOPSstandsreadytoassistwithanyfurtherpolicyworkbytheCommissioninthisarea.
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CEIOPSalsosubmittedAdvice to theCommissionon therevisionof the InsuranceMediationDirective(IMD)on11October2010.ThiswasinresponsetoaRequestforAdviceitreceivedfromtheCommissionon27January2010.
AspecialisedTaskForcewassetupundertheauspicesofCEIOPS’CommitteeonCon-sumerProtection(CCP)inFebruary2010topreparetheAdvicetotheCommission.TheTaskForcewassplit intothreeDraftingTeams: (i)LegalFramework,ScopeandProfessionalRequirements;(ii)ConsumerProtection(TransparencyofRemunerationand Conflicts of Interest) and (iii) Cross-Border Aspects (Registration and Notifica-tions).
AnumberofmeetingsoftheDraftingTeamsandtheCCPwereheldbetweenMarchandendofSeptember2010withaviewtofinalisingtheAdvice.CEIOPSalsoreceivedinformaloralandwritteninputfromkeystakeholderssuchasBIPAR(theEuropeanFederationofInsuranceIntermediaries);CEA(EuropeanCommitteeofInsurers)andconsumerrepresentativesonCEIOPS’ConsultativePanel.
ThefinalAdvicesubmitted,contained39recommendationsandcoveredthesevenareasintheRequestforAdvice,thekeyonesbeingTransparencyofRemuneration/ManagementofConflictsof Interest, LegalFrameworkandScope.CEIOPSalsoad-dressedareasintheexistingIMDwhereadministrativeburdencouldbeeradicatedor,ifnot,reduced.
TheCommission’sConsultationPaperontherevisionoftheIMDwaspublishedon26November2010,settingoutitsproposedthinkingonthewayforward.Draftlegisla-tiveproposalsareexpectedinthefirstweekofDecember2011.CEIOPSalsoattendedapublichearingontheIMDRevisionon10December2010atwhichtheChairoftheCCP,VictorRod,moderatedapanel.
CEIOPS was invited by FIN-NET (a financial dispute resolution network of nationalout-of-courtcomplaintschemesintheEuropeanEconomicArea,EEA)topresentitswork on consumer complaints. This included CEIOPS’ various contributions in thehandlingofconsumercomplaints.
InJuly2010,theEuropeanCommissionpublishedaWhitePaperonInsuranceGuar-anteeSchemes,includinganimpactassessment.TheECWhitePaperproposedop-tionsthataresimilartotherecommendationspresentedbyCEIOPSin2009.
CEIOPSTaskForceonIGS(undertheChairmanshipofOle-JoergenKarlsen)submit-tedcommentstotheCommissionontheWhitePaperandtheImpactAssessment.CEIOPSfivemostimportantrecommendationstotheCommissionweretoadoptaholistic approach for determining the scope of IGS, to be aware of the differencesbetween thebankand the insurancesector, to leave roomfornationalchoices, toanalysecarefullythefundingissueandtotakemotorinsuranceintoconsideration.
Victor Rod CCPChairCAA,Luxembourg
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OThER ACTIvITIES
12.1 Accounting
CEIOPSspecificaimwastoensureconsistencyandcompatibilitybetweenthegeneralaccountingframeworkandthevaluationrulesunderSolvencyII.Tothisend,in2010,CEIOPSprovided the InternationalAccountingStandardsBoard (IASB)withacom-mentletteronbothIASB’sExposuredraftsonbothinsurancecontracts(IFRS4)andondefinedpensionplans(IAS19).CEIOPSalsoprovidedtheEuropeanFinancialReportingAdvisoryGroup(EFRAG)aswellasIASBwithcommentlettersonexposuredraftsonboth,fairvalueoptiononfinancialliabilitiesandmeasurementofliabilities(IAS37).
CEIOPSwasparticipatingactivelyasanobserverintheEuropeanCommission’sAc-countingRegulatoryCommitteeandinEFRAG’sInsuranceaccountingworkinggroup.
12.2 International Relations
CEIOPSMemberswereactivelyinvolvedintheworkofinternationalassociationssuchastheInternationalAssociationofInsuranceSupervisors(IAIS)andtheIn-ternational Organisation of Pension Supervisors (IOPS).Where relevant, regularupdatesontheactivitiesofthesebodieswereprovidedorshared,andwerethenfedintorelevantCEIOPSworkstreams.
Inviewofitsstrongerroleininternationalrelations,EIOPAwillconsidermoreac-tiveinvolvementinrelevantworkstreamsofinternationalorganisations.
12.3 Regulatory Dialogues
CEIOPS’regulatorydialoguescontinuedtotakeplacein2010.MeetingswereheldinOctober2010withspecificUSInsuranceCommissionersandNAICstaffintheframeof the EU-US Dialogue, with the Chinese Insurance Regulatory Commission (CIRC)intheframeoftheSino-EUDialogue,withtheJapaneseFinancialServicesAgency(JFSA)duringtheJapan-EUDialogueandwiththeAssociationofLatinAmericanIn-suranceSupervisors(Assal)duringtheAssal-EUDialogue.
Recurrentissuesontheagendawereupdatesonthedevelopmentoftheinsurancemarkets and regulation on both sides, as well as discussions relating to insurancegroupsupervision,theassessmentsoftheequivalenceofspecificthirdcountrysu-pervisoryregimes,thedevelopmentofthenewstructureforfinancialsupervisioninEurope,accountingortheexchangeofexperienceonspecificitemsofinterest.
EIOPAwillcontinuetodevelopthesedialoguesandexchangesandremainsopentoexchangeviewswithotherthirdcountries,asithasdoneinthepast.
12.4 CEIOPS Conference
In2010,CEIOPSorganisedits6thAnnualConference,whichtookplaceon17Novem-ber2010inFrankfurtamMain,Germany.Itattractedmorethan300participants.
The conference offered an interesting and exciting programme, as well as an op-portunitytohearfromexperiencedandrespectedfiguresinEuropeanfinancialsu-pervision.The latestdevelopmentsaffectingEuropean insuranceandoccupationalpensionswerecovered,togetherwiththenewsupervisoryarchitectureforfinancialservicesinEurope.
CEIOPSConferencewasopenedbyitsChairMr.GabrielBernardinoandincludedtwokeynotespeakers,whichare:●JonathanFaull–DirectorGeneral,DGInternalMarketandServices,EuropeanCom-
mission●SharonBowles,MEP,ChairoftheEconomicandMonetaryAffairsCommittee(ECON),
EuropeanParliament.
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Publicsector(40),13%
Consultance(25),8%
RealEstate(8),3%
Trade/Industry(7),2%
IT(4),1%
Banking/Finance(66),21%Misc.(20),6%
Insurances(78),24%
Press,Media(30),9%Judicary(11),4%
University(6),2%
Politics(14),4%
Associations(11),3%
CEIOPSConferencehadthreepanels:●Insurance–TheSolvencyIIpanelfocusedonthelevelofpreparednessofinsurance
undertakingsandtheirsupervisorsfortheimplementationofthenewframeworkdirective.Industry,CommissionandCEIOPSrepresentativesreportedonthemajorachievementsandchallengesaheadinensuringasuccessfultransitiontothenewsolvencyregime.CEIOPSSecretaryGeneralalsoprovidedattendantswithanearlyreportontheparticipationrateintheQIS5exerciseandwithanoverviewofactionstobeundertakeninordertoensureaReportispublishedinMarch2011.
●Occupational Pensions – The discussion in the pensions panel focused on theEuropean Commission Green Paper on pensions as well as on main challengesfacingthesectortowardsensuringatruesinglemarketforoccupationalpensionsiscreated.Duringthepanel,CEIOPSfurtherwelcomedtheGreenpaperasanim-portanteventforEuropeanpensionsandexpressedfullsupportforitsobjectives.ItwasfurthernotedthatCEIOPSresponseandfurthercontributionwillfocusonthoseissueswithinthecompetenceofCEIOPS,whichwerenotpoliticalinnature.Itwasalsohighlightedthoseareas,which,althoughoutsidesupervisorycompetence,wouldmeritCEIOPSinvolvementonthegroundsoftheconsiderabletechnicalex-pertiseandsupervisoryexperienceofitsMembers
●ThenewSupervisoryAuthorities(ESAsandESRB)–underthesteerofMEP–SharonBowles(ECONChair,ALDE),thepanelbroughttogethertheChairofthe3L3Com-mitteesaswellastheECBVice-President.Theydiscussedthelatestdevelopmentsintermsofsettingupthenewsupervisoryinfrastructure,bothatmacroandmicrolevels.Challengesaheadaswellasearlyindicationofactionstobetakentoensureasuccessfultransitiontothenewframeworkwerecentraltothediscussion.
EFW2010:CEIOPSConference
AnalysisParticipantsbyBusinessSector(Participantstotal:328)
12.5 Web Site
Sinceitslaunch,theCEIOPSwebsitehasproventobethemostsuccessfulcommu-nicationtoolfordisseminatinginformationbothtoexternalstakeholdersaswellasCEIOPS Members. Statistics show that the interest of stakeholders and interestedparties tousetheCEIOPSwebsitehasremainedhighwithmorethan12.5millionhitsoverthecourseof2010.
Inordertocaterfortheincreasednumberofpublications&visitorsandtoprovideenhancedsecurityfeatures,CEIOPSSecretariatundertookamajorprojectthrough-out2010ofrestructuringtheexistingtechnicalplatform.TheprojectbenefitedfrompartialEuropeanCommissionfunding.ThenewCEIOPSwebsiteisdesignedtopro-videimprovedsecurity,enhancedusabilityandefficiencywhilemaintainingsomeoftheexistingfunctionalitiesthatCEIOPSmembersandstakeholdershaveappreciatedoveryears.ThenewCEIOPSwebsitewaslaunchedon20September2010.
12.6 Training
CEIOPSbelievesintheroleoftraininginthedevelopmentofacommonsupervisorypracticeandthebuildingofacommonsupervisorycultureacrossEurope.Thereforeoneofthemaingoalssincethebeginningwastoofferqualitytrainingfreeofchargeto European supervisors. CEIOPSTraining Programme for 2010 was partly open toindustryparticipantsandsupervisors fromcountriesoutsideof theEuropeanEco-nomicArea(EEA).
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12Industry,27%
EEAsupervisors72%
NonEEAsupervisors,1%
Analysis2010trainingparticipants
In2010,atotalof1082participantsattendedthetrainingactivities,ofwhich:●667MembersandObserversAuthorities:CEIOPSanditssisterCommittees,CEBS
andCESR●400industryrepresentatives.●7participantsfromnonEEAcountries:3FINMA(Switzerland),1MinistryofFinance
Israel,1BermudaMonetaryAuthority,1AustralianPrudentialRegulationAuthority,1InsuranceDivisionStateofNewMexico;and
●8participants fromother institutions:2GibraltarFinancial ServicesCommission,2ECB,1preparatoryESRBSecretariat,2Bundesbankand1IAIS.
Atotalof21trainings(15sectoralseminars,3cross-sectoralseminarsand2work-shops)wereorganisedbyCEIOPSin2010.ThiswaspossiblethankstothesupportfromCEIOPSCommitteesandWorkingGroups,whichprovidedexpertsandspeakers,andontheco-operationofCEIOPSMembers,byhostinghalfoftheseminars.
Complementarytothesectoralandcross-sectoralseminars,thetrainingprogrammewasextendedwithtwo‘trainthetrainer’workshops,aimedatdevelopingthecom-municationskillsofworkinggroups’expertstypicallyinvolvedinthedeliveryofsemi-nars.Thiswasdevelopedthroughthesupportofaprofessionaltrainer.
In2010,CEIOPSMembersfocusedtheireffortsonincreasingthequalityandvarietyoftraining.Thedecisionmadein2010,followingthefeedbackprovidedbysupervi-sors,wastoincreasethelengthofseminarsfrom1to2days,especiallythosecover-ingSolvencyIIaspects.Thetablebelowshowsthetrendofanincreasednumberoftrainingdayssince2007.
2010CEIOPSsectoralseminars●StressTesting-Frankfurt,23March●InsuranceGroupssupervision–hostedbyACPinParis,1April●RegionalseminaronCorporateResponsibilityofDirectorsofInsuranceCompanies
(opentotheindustry)–hostedbyMaltaFSA,8–9April●SolvencyII–NewSupervisoryFramework–Frankfurt,4–5May●Advancedtechniquesofriskmitigationandriskmanagement(incl.securitisation,othernew
financialinstruments)–Frankfurt,6May●SolvencyIIvaluationofassetsandliabilities,includingTechnicalProvisions–hostedbyISVAP
inRome,13–14May●SolvencyIIReportingandPublicDisclosureRequirements–hostedbyHFSAinBudapest,7–8June●SolvencyIIQIS5,Frankfurt,8–9July●SolvencyIIQIS5(opentotheindustry)–Frankfurt,25–26August●Groupsolvencyassessment–Frankfurt,9–10September●Consumerprotection–hostedbyNationalBankofSlovakiainBratislava,22September●SolvencyIIGovernanceSystem(incl.Riskmanagement,ORSA)–hostedbyPolishFSAinWarsaw,
8October●Pensionsseminar–hostedbyDNBinAmsterdam,14–15October●Internalmodelsapproval–Frankfurt,27–28October●IFRSAccounting–hostedbyCNBinPrague,2November
2010CEIOPSworkshops●Trainthetrainer;PresentingwithImpact–Frankfurt,21–22July●Trainthetrainer;PresentingwithImpact–Frankfurt,20–21October
35
30
25
20
15
10
5
0 2007 2008 2009 2010
Seminars Trainingdays
Evolutionseminars&durationofseminars
The 2010 Training Programme was supported by the European Commission, bymeansofaco-fundingprogramme,whichmadeitpossibletofinance90%ofthetrainingcostsfromnon-CEIOPSfunds.
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3L3 SECTIOn Of ThE 3L3 COmmITTEES 2010 AnnuAL REPORTSInCLudIng CROSS SECTOR WORk
The jointworkof the3 Level3Committees (3L3),CESR,CEBSandCEIOPS, focusedonachievingconvergencebetweenthefinancialsectorsofsecuritiesmarkets,creditinstitutions(banks),andtheinsuranceandpensionsmarkets.Theinter-linkagesofthese sectors called for close co-operation among the 3L3 Committees in order toensureaEuropeanlevelplayingfield,consistencyinlegislativeimplementation,costeffectivenessandproperassessmentofcross-sectorrisks.In2005,the3L3Commit-teesformalisedthisco-operationbysigningajointprotocolonco-operation.InDe-cember2008,thisprotocolwasupdatedtoreflectthe3L3experiencesofjointworkcompleted,andtotakeintoaccountthelatestdevelopments,suchastheLamfalussyreviewandtheeffectsofthefinancialcrisis..
13.1 3L3 provided input in preparing new European financial supervisory framework
The3L3ChairsandSecretariatsregularlymetanddealtwithallactivitiesdescribedinthe3L3workprogrammeduring2010,wheretheirprioritywastheirsupervisoryresponsetothereformoftheEUfinancialsupervisoryarchitectureandtheprepara-tionoftheLevel3CommitteesfortheirtransitiontothenewEuropeanSupervisoryAuthorities(ESAs).
Inthisrespect,the3L3activelyfollowedandco-ordinated,wherenecessary,develop-mentsinrelationtotheproposalssettinguptheESAs.TheLevel3ChairsandtheirrespectiveSecretaryGeneralsandSecretariats regularlyconvenedconferencecalls,exchangedbriefingsandmetofteninadvanceofmeetingswiththeEUinstitutions.On 18 June 2010, the 3L3 Committees submitted a detailed note to the EU insti-tutionsinvolvedinthetriloguediscussionsoutliningtheirspecificconcernsonthebasicquestionsoftheclearassignmentofresponsibilitiestotheESAs,theiraccount-abilityandtheirindependence.Thenoteconsideredfivemainissues:●The independence of the Authorities - independent financing of the Authorities,
selectionoftheChairpersonandtheExecutiveDirector,compositionoftheBoardofSupervisors,BoardofAppealandPeerReview;
●Crisissituationandemergencymeasures;●Enhanced3L3cooperationthroughthe“JointCommittee”;●CollectionofinformationandcooperationwiththeESRB;and●Operationalissueslinkedtothetransition.
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13 Several meetings were held during 2010 with the European Commissioner for In-ternalMarketandServices,MichelBarnier,theChairwomanoftheEuropeanParlia-ment’s Committeeon Economic andMonetary Affairs (ECON),SharonBowles,andthePresidentoftheEuropeanCentralBank,Jean-ClaudeTrichet.
Throughout2010,the3L3attendedmeetingsoftheEUCouncil’sFinancialServicesCommittee(FSC)andwereinvitedtoattendmostmeetingsoftheEUCouncil’sEco-nomicandFinancialCommittee(EFC)inordertodiscussissuessuchasfinancialmar-ketdevelopments,crisismanagement(e.g.stresstesting)andinternationalregula-torydialogue.
NextstepsGiventhelandmarkinstitutionalchange,namelythecreationofthethreenewEuropean Supervisory Authorities (ESAs), ESMA, EBA and EIOPA, which respec-tivelycame intobeingon1 January2011, the threeESAs’coordination isnowformalised in the new Joint Committee of the ESAs.The first meetings of theBoard of Supervisors of the ESAs were held from 10-12 January 2011 and thefirstmeetingoftheESRBSteeringBoardwasheldon20January2011.TheseniormanagementoftheESAsisexpectedtobeinplacebyJune2011.
13.2 3L3 Task Force on Cross-Sector Risks
Identifyingcross-sectoralriskswillhelpthe3L3Committees,theirmembersandtheEU institutions in ensuring the stability of European financial markets. FollowingtheECOFINCouncilconclusionsinMay2008,theEuropeanCommission’sdecisionsestablishingeachofthe3L3Committees,andtherequesttothe3L3Committeestorespondtofinancialstabilityconcernsofacross-sectoralnature,the3L3Committeessetupa3L3TaskForceonCross-SectoralRisks,whichhasbeentaskedwithenhanc-ingthe3L3Committees’sectoralriskassessmentsbycapturingcross-sectoralissuesandidentifyingcontagionchannels.InApril2010,theTaskForce,whichischairedbyJukkaVesala, Deputy Director General of the Finnish FSA, delivered to the EFC-FST(EconomicandFinancialCommittee–FinancialStabilityTable)thesecondoftwopi-lotreports.
Thesedevelopmentsshow,atanearlystage,the3L3Committees’abilitytocapturecross-sectoralrisksrelevanttotheriskassessmentsoftheCommittees:commonrisksacrosssectors,andespeciallyriskswhicharecontagiousfromonesectortoanotherandendogenousriskswhereregulatoryactioninonesectormayhavesignificantriskimplicationsforanothersector.
Theworkaimsatcapturingcontagionrisksbetweenindividualinstitutionsandsec-torsfromasupervisorycross-sectoralviewpoint,andbringsthemicro-prudentialfo-cusintotheoverallassessmentofthefinancialstability.
ThesecondpilotreportofApril2010dealtwiththefollowingrisks:interdependenceandfeedbackloopsbetweenthefinancialsectorandtherealeconomy;cross-sectorholdingsandexposures;marketsentimentspill-over;andchangesinassetpricesanddeleveraging.
InSeptember2010,the3L3providedtheEFCwithareport.Whilstthereportnotedimprovements in the macro-economic conditions and that successful governmentsupportmeasureshadhadapositiveeffectonfinancialinstitutions, ithighlightedthefollowingrisks:spill-overrisksofsovereigndebtproblemsforfinancialmarketsandinstitutions,risksassociatedwithbanks’fundingposition,anewdeteriorationinassetsmarkets,ashiftand/orchangedshapeoftheyieldcurve,“retailisation”ofcertaincomplexproducts,businessmodelandprofitability-relatedrisks,andfinallybusinessmodelandprofitability-relatedrisks.
NextstepsTheESAswillcontinuetheworkstartedbythe3L3Committeesoncross-sectoralriskidentificationandassessmentundertheJointCommitteeoftheESAsand,togetherwiththesectoralriskassessmentsdonebyeachoftheESAs,willcon-tributetotheoverallassessmentofthesystemicrisk,whichisthesharedrespon-sibilityoftheESAstogetherwiththeESRB.
13.3 Anti-Money Laundering Task Force
The 3L3 Anti-Money LaunderingTask Force (AMLTF) was established in the secondhalf of 2006 by CESR, CEBS and CEIOPS, with the aim of achieving convergence innationalimplementationoftheThirdMoneyLaunderingDirective(3rdMLD)acrossthedifferentsectorsofEuropeanfinancialmarketsandwithaviewtoprovidesuper-visoryinputintoanti-moneylaundering(AML)issues.
Throughout2010,theAMLTFmetfourtimesunderthenewchairmanshipofUldisCerps (Finansinspektionen, Sweden). In the course of 2010, theTask Force investi-gatedsupervisorypracticesrelatedtothe3rdMLDbywayofquestionnairessenttoallitsTaskForcemembersinrelationtoa)BeneficialOwnersandb)SimplifiedDueDiligence(SDD),withaviewtoassessingwhetherthedifferencesinanyimplemen-tationpracticenotedmightresultindifferentoutcomesforAML,anditssupervisionthroughouttheEU.
ReflectingcurrentdevelopmentsinEuropeanAMLlegislationandpractice,withtherecently introduced Payment Services Directive (PSD), the AMLTF also undertook astock-takeexerciseofsupervisorypracticesinrelationtoAgentsofPaymentsServicesInstitutions(PSIs)providingthepaymentservicesofmoneyremittance.
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Furthermore,theAMLTFhasundertakenpreparatoryworkforahome/hostsupervi-soryprotocolbetweeninvolvedAMLsupervisorsofaPSIanditsagentsandbranches.Duringthispreparatorystage,theAMLTFfoundthattheProtocolwouldprovideforapracticalandpragmaticframeworkforinvolvedhomeandhostsupervisorsofaPSItoassistthesupervisionrelatingtotheantimoneylaunderingobligationsunderthe3rdMLDandthePSD.
During2010,AMLTFMembersalsodiscussedtheFinancialActionTaskForce/OECDlistsofnoncooperativeandhighriskjurisdictionspublishedinFebruary2010,andtheirsupervisoryapproachtoSDDandrelianceon3rdparties,vis-à-visthejurisdic-tionsnamedonthesetwoFATFpublishedlists.
NextstepsInlightoftheestablishmentofthethreeESAs,theJointCommitteeoftheESAswillestablishaSub-CommitteeonAntiMoneyLaunderingtotakeoverandfinal-iseallAMLTFworkstreamsinitiatedinthecourseof2010,namely:a) ToassessimplicationsformoneylaunderingriskandAMLsupervision,inre-
spectofdifferencesinsupervisoryimplementationpracticesnotedinthe3rdMoneyLaunderingDirective(basedon2010workonBeneficialOwnersandSimplifiedDueDiligence),andpossiblydevelopguidance;
b) TodevelopasupervisoryprotocolbetweeninvolvedAMLsupervisorsofaPay-mentServicesInstitutionsanditsagentsandbranches;and
c) ToassessimplicationsforAMLsupervision,andpossibledevelopmentofasu-pervisoryprotocol,inrelationtothenew2ndE-moneyDirective.
13.4 3L3 Work on Financial Conglomerates
TheJointCommitteeonFinancialConglomerates(JCFC)metfourtimesin2010un-der thechairmanshipofThomasSchmitz-Lippert (Bafin,Germany)frommid2010,andPatrickBrady(IFRSA,Ireland)untilmid2010.
TheJCFCprovided input to theEuropeanCommission’sproposalsfor thequickre-view of the Financial Conglomerates Directive (FICOD), known as FICOD I, and thefundamentalreviewofthisDirective,FICODIIthroughout2010.Forexample,inJuly2010theJCFCsentalettertotheEuropeanCommissiontoadviseaseamlesstransi-tionfromthecurrentInsuranceGroupsDirectivetowardsSolvencyII,byproposingtoamendthedefinitionofaholdingcompanyintheSolvencyIItextinsothatalsoun-derthenewinsuranceregulationbothsector-specific(bankingandinsurance)super-visionandsupplementarysupervisioncouldbeappliedontheconglomerate’sparententity.OralreportswereprovidedbytheJCFCtotheEFCCattheirtwomeetingsheldin2010.FurthertheJCFCprovidedrecommendationstotheEConOmnibusIinrela-tiontoFinancialConglomeratesupervision.
TheJCFCpublishedandsubmitted itsannual listoffinancialconglomerates,asat1stJune2010,basedon2010yearendfiguresreportedbytheundertakings,sothatMemberStatescouldmeetthereportingrequirementsinArticle4(2)oftheFCD.TheJCFCnotedthattheongoingdynamicsinthefinancialsectorwerereflectedbysev-eralmergersofpreviously identifiedconglomerates,aswellasnewconglomeratescreated,andtherestructuringofexistingconglomeratessuchthattheyarenolongercapturedunderthescopeoftheFICOD.
Furthertoits2009advicetotheEuropeanCommissiononthereviewoftheFICODondefinitions,scopeandinternalcontrolrequirements,andhowtheseareasandtheirimplementationwithintheexistinglegislativeframeworkmayimpactonthefulfil-mentoftheobjectivesoftheFICOD,supervisorsfeltitwasnecessarytoimmediatelystart working on one topic, namely participations, so as to strive for more conver-gencebetweenMemberStates,evenbeforethereviewoftheFICOD.Accordingly,theJCFCestablishedaParticipationsWorkingGrouptoconcentrateon:★Identification of Financial Conglomerates and specifically the to address how to
includeparticipationsinthecalculation(durablelink,indirectparticipations)★When identified, how to include participations in the day-to-day supervision (for
exampleRiskConcentrationandIntra-GroupTransactionsandwhatkindofinfor-mationcouldbereasonableobtainedinthecaseofnon-controlledparticipations)
Bytheendof2010,theJCFC’sParticipationsWorkingGroupprepareddraftguidanceonDurableLinkonhowtoincludeparticipationsinthecalculationswhenidentifyingaFinancialConglomerate.
TheJCFCmonitoredalsotheFinancialConglomeratesdimensionofCEBSandCEIOPSsectorworkonColleges,toensureFICODconsistency.AteachoftheJCFC’s2010ple-narymeetings,JCFCMembersdiscussedtheirpracticalexperienceofdiscussionoftheFICODrequirementswithinacollegeandalsotheSecretariatconductedasurveyamongsttheJCFCmembership.TheJCFCnoted,amongstotherstheirpreferencenottoduplicatesectorcolleges.TheSecretariatconductedananalysisof thestatusofcollegediscussionstodateonFICODrequirements,whichnotedimprovementscouldbemadeasnotallgroupshavecolleges,andthatthosethatdomeet,havevaryingdegreesofdiscussingtheFICODdimensions.AccordinglytheJCFCdrafteditsrecom-mendationsonSupplementaryFICODrequirementsinsupervisorycollegesoffinan-cialconglomeratesthatcouldbeaddedtothealreadyexistingsectoralguidelines.Thesesevenrecommendationswereendorsedandpublishedon21December2010,byCEBSandCEIOPS.Theserecommendationsinclude,amongothers,thesettingup,foreveryfinancialconglomerate,ofaplatformfordiscussingFCDissueswithintheexistingcollegestructure.Theplatformiseitherestablishedatbanking level, forabanking-ledfinancialconglomerateoratinsurancelevel,foraninsurance-ledfinan-cialconglomerate.
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NextstepsThe threeESAswill continue theworkonfinancialconglomerates in the JointCommittee’sSub-CommitteeonFinancialConglomerates,including:●PublicationofthelistofidentifiedFinancialConglomerates,inaccordancewith
thelegalrequirementsfollowingOmnibusIDirective.●Draftguidanceonthe identificationandsupervisionofparticipationswillbe
publishedforconsultation.●CommenceworkonprovidingadvicetotheEConFICODII.●Developtemplatesforcollegesoncross-sectoralaspects.●CommencepreparationofGuidanceandTechnicalStandardsonspecificFICOD
requirements.
13.5 Internal Governance
InJanuary2010,the3L3TaskForceonInternalGovernance,chairedbyGabrielBer-nardinoofthePortugueseInsuranceandPensionsFundsSupervisoryAuthority,pub-lishedareportonaCross-sectoralstock-takeandanalysisofinternalgovernancere-quirementsandsentthistotheEuropeanCommission.Thereportaimedtoidentifyareas,forpossibleharmonisationofthedifferingregulationsofthethreefinancialservicessectors.Thereportidentifiednoareas,ofahighpriority,forharmonisation.Although,forsomeareas,alowormediumprioritywasidentified.ACallforEvidencewaspublishedwiththereport,withtheaimtogetindustries’viewsontheneedforharmonisation.
On9February2010, theEuropeanCommission’sCompanyLaw,CorporateGovern-ance and Financial Crime Unit convened a meeting with representatives of CESR,CEBSandCEIOPStodiscussthe3L3workonInternalGovernanceandalsotheEuro-peanCommission’sworkonCorporateGovernance.
InJune2010,theEuropeanCommissionpublisheditsGreenPaperonCorporateGov-ernanceandRemunerationpolicies.AtthebeginningofSeptember2010,CEBS18andCEIOPSsenttheirrespectivesectorresponsestotheEuropeanCommission.TheEu-ropeanCommissionheldameetingwiththe3L3on16September2010todiscussitsCorporateGovernanceGreenPaperandRemunerationissues,inparticularregardingtheresponsesreceivedfromCEBSandCEIOPS.TheEuropeanCommissionreceivedmorethan200responsestoitsGreenPaper,andinvitedCEBS,CEIOPSandCESRtodiscussmorespecificissuesraisedbyrespondentsandhowtheycouldbedealtwith,withintheproposedregulation.AfurthermeetingwasplannedforJanuary2011.
On13October2010,theEuropeanCommissionpublisheditsGreenPaperonAuditPolicy.The3L3Committeespreparedacommon3L3coverletterfortheirresponsestothisGreenPaper.This3L3coverletterincluded,asanAnnex,moredetailedcommentsfromeachofthe3L3committees.
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NextstepsTheJointCommitteeoftheESAsmayundertakefurtherworkcomparingMiFID,CRDandSolvencyII,inlightoftheEC’sworkoncorporategovernanceandaudit.
13.6 Joint Work on Non-Cooperative Jurisdictions
InordertoassisttheEUpoliticalinstitutionsinpreparingthemeetingsoftheFinancialStabilityBoardandG20heldinthefirsthalfof2010,the3L3CommitteesaskeditsMembersforanupdateontheirexperienceoncooperativejurisdictionswithintheirMembers’regulatory/supervisorycompetencies.The3L3CommitteessummarisedtheresultsthatwereprovidedtotheEFCFinancialStabilityTablemeetingon9April2010.
For theEFC-FSTmeetingon20/21September2010, in linewith the2004politicalrequestoftheEFC,the3L3Committeesfurthersubmittedareportbasedonthe3L3Committeemembers’responsecollectedoverthesummer.Thereportnoteddevelop-mentsaswellasremaining/deepeningissuesthatMembersfromthethreesectorsexperiencedin2010.The3L3CommitteesnotedthatpartoftheG20agendarelatestotaxconcernswhichgobeyondthe3L3supervisorycompetencies,whilstcontinuingtosupportthestrongmomentumintheG20/FSBagendaforreformstorepair,strengthentheresilienceandimprovethefunctioningoffinancialsystemsgoingforward.
Nextsteps:InlightoftheestablishmentofthethreeEuropeanSupervisoryAuthoritiesandasperdecisionoftheSeptember2010EFC,thefutureJointCommittee,willcon-tinuethepracticeofthe3L3Committees,toprovideanannualreporttothepo-litical levelonrelateddevelopmentsofnon-cooperative jurisdictions in theEUfinancialsector.
13.7 3L3 Joint Task Force on Packaged Retail Invest-ment Products (PRIPs)
A3L3TaskForceonPackagedRetailInvestmentProducts(PRIPs)wassetupinFebru-ary2010toformulateacommon3L3positiononthescopeofPRIPsandtheappropri-ateprinciplesforpre-contractualproductdisclosuresandsellingpractices.
TheTaskForcewaschairedbyAnneliTuominen(Finanssivalvonta,Finland)andwascomposedofanequalnumberofrepresentativesfromCESRandCEIOPS,aswellasof experts from CEBS on structured deposits and of observers from the EuropeanCommission.
Fivemeetingswereheldbetween9April2010and10September2010.On6October2010,areportwassubmittedtotheEuropeanCommission,underajoint3L3Chairscoverletter,anditwaspublishedonthewebsitesofthe3L3Committeeson12Oc-tober2010.
TheTaskForcesought,whereverpossible,toformconsensualviewsonthekeyaspectsofPRIPs.However,wherethiswasnotpossible,alternativepositionswereexpressed.
The European Commission published a Consultation Paper on its proposed legalframeworkforPRIPsscopeandproductdisclosureon26November2010.Draftleg-islative proposals on pre-contractual product disclosures for PRIPs are expected inJune2011.LegislativeproposalsregardingsalesofPRIPs,whichwillbeincorporatedinarevisedMiFIDandIMD,arenotexpecteduntillater2011.The3L3Committees,intheirnewformulationsasESAsstandreadytoassistwithanyfurtherpolicyworkbytheEuropeanCommissioninthisarea.
NextstepsTheTaskForcemaytakeupfurtherworkwithintheframeworkoftheJointCom-mittee of the ESAs in the second half of 2011 to eventually provide advice inresponsetotheCommission’slegislativeproposalsonproductdisclosure.
13.8 Fostering Convergence Through 3L3 Training
In2010,the3L3TaskForceontraining,whichbringstogetherseniorrepresentativesfromeachoftheLevel3Committeesandtheirmembers,continuedtofosterconver-genceamongstsupervisorsbyreachingahigherlevelofco-operationoncross-sectortraining.Thesecross-sectorseminarssupplementthesectortrainingseminarswhicheachoftheCommitteesorganises.
Thethreemajorareasofco-operationduring2010included:●organisingcross-sectorseminars,●planningannual3L3TrainingProgramme,and●reviewingthe3L3ManualonTrainingProcesses.
Organising cross-sector seminars:TheTask Force and the 3L3 Secretariats made ajointeffortindeveloping,monitoringandassessmentofthe3L3trainingprogramme.Alongwithotherprojectsofthe3L3Committees,cross-sectortraininghasbenefitedfromasecondyearoffinancialsupportfromtheEuropeanCommissionin2010.
Followingtheanalysisofthelearningoutcomesprovidedinthefeedbackreceivedonthetraining,theTaskForceconcludedthatthefurtherinvolvementoftheSecre-tariatsintheimplementationoftrainingandacloserco-ordinationwiththehostswouldbebeneficialinthefuture.
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Planningtheannual2011TrainingProgramme:The3L3Secretariatsco-operatedinthe development of a common questionnaire aimed at assessing the demand fortrainingneedsin2011andtoidentifyvolunteerstohostandorganiseseminars.Forthe first time, the online questionnaire facilitated a co-ordinated response by sin-gleregulatorswhoareMembersofthe3L3Committees.Thefeedbackprovidedwasused by theTask Force as a basis for planning the 3L3 training programme of thefollowingyear.
Reviewing the 3L3 Manual onTraining Processes: Given the transformation of the3L3intoESAsasof1January2011,theTaskForcerevieweditsmanualontraining,developedin2009, inordertoreflectthebudgetaryproceduresoftheESAsandtomakeitmoreuserfriendly.TheupdatedESAsManualonTrainingwillbefinalisedandpublishedin2011.
The3L3Committeesmaintainedthenumberofcross-sectoralseminarsin2010: The3L3Committeesdevelopedacross-sectortrainingprogrammetoensurecross-sectorconvergence,togetherwiththeessentialsupportofthememberswhovolunteeredinhostingandorganisingseminars
The3L3trainingprogrammefor2010includedthefollowingcross-sectorseminars
Theeffortdevoted to trainstaffofEUsupervisoryandregulatoryauthoritiesonacross-sectorbasisduring2010allowedforthetrainingofover350supervisors,whichmeansfurtherstrengtheningofourcommonsupervisoryculture.
NextstepsTheTaskForce,within theframeworkof the JointCommitteeof theESAs,willcontinuethetrainingprogrammefor2011andwillfinalisetheESAs’ManualonTraining,aswellasstrengthencooperationinsupervisorytraining.
No. Nameofseminar Date&Location HostNumberof
participants
01 CorporateGovernance 26February,Lisbon
CNVM 35
02 AssessmentofITsystemsandapplica-tionsinfinancialinstitutions
1–3March,Eltville(Frankfurt)
BuBa 29
03 NegotiatingskillsforEuropeanSupervisors
4–5March,Eltville
BuBa(ESE) 14
04 SeminaronRiskManagementforFinancialConglomerates
18–19March,Amsterdam
DNB&Duisenberg
SchoolofFinance
28
05 NegotiatingskillsforEuropeanSupervisors
6–7May,Eltville BuBa(ESE) 10
06 AssessmentofITsystemsandapplica-tionsinfinancialinstitutions
9–11June,Eltville BuBa 28
07 UnderstandingtheimpactofLehman’sdefaultonmarketparticipants
17–18June,Paris AMF 26
08 InternalModelvalidation–BankingandInsurancesector
24–25June,Rome Bancad’Italia&ISVAP
47
09 NegotiatingskillsforEuropeanSupervisors
15–16July,Eltville BuBa(ESE) 12
10 NegotiatingskillsforEuropeanSupervisors
27–28September,Eltville
BuBa(ESE) 9
11 Clearingandsettlement–recentdevelopmentsandchallenges
29–30September,Frankfurt
BuBa 24
12 NegotiatingskillsforEuropeanSupervisors
21–22October,Eltville
BuBa(ESE) 9
13 ThenewEuropeanSystemofFinancialSupervision
6–7December,Paris
CESRSecretariat
55
14 SupervisoryColleges 9–10December,Berlin
BaFin&CEIOPS
30
Total 323
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EIOPA 2011 WORk PROgRAmmE
14.1 Introduction
ThisworkprogrammarksthestartoftheworkofEIOPA.Theobjectivesset inthisworkplanarebasedontheRegulationestablishingEIOPA,asithasbeenapprovedbytheEuropeanParliamenton22September2010andontheongoingworkprogramofCEIOPS,whichwillbecontinuedunderEIOPA.
The transition from CEIOPS to EIOPA is not a process that will be completed on1 January 2011. Although EIOPA will be operational and up-and-running from thefirstday,alotoflessurgentproceduresandprocessesstillhavetobeincorporatedduring thefirstmonths,andsomeevenup till theendof theyear,given theirna-ture.Thistransition,inthemiddleoftheongoingandimportantworkthatCEIOPS/EIOPAisdoingontheareaofSolvencyIIandpensions,iscreatingextrachallengesforEIOPAtokeeptrackwithalltheambitiousgoalsthatareset.Tokeepitssuccessgo-ing,CEIOPS/EIOPAhasreliedonasmall,butdedicatedteamtoreachitsgoals.During2010,thisteamhassteadilygrown,from17inJanuaryto27inDecember.Andfur-thergrowthisforeseentoaround50attheendof2011asthenewtasksandrespon-sibilitiesundertheRegulationwillpushEIOPAfurther.
Despite thisgradualgrowth,EIOPAcannotfrom thestartaccomplishall the tasksandresponsibilitiesassetintheRegulationtoitsfullextent.Forapartthisischan-neledbecausemanyofthenewresponsibilitiesarelinkedtoSolvencyIIwhichwillcomeintoforceinJanuary2013.ForanotheritmeansthatprioritiesneedtobesetandthatcertainelementsofworkofEIOPAwilldevelopgraduallyasourteamwillcontinuetodevelop.
For2011,themainprioritiesare:1. Datacollectionandprocessing2. Consumerprotection/FinancialActivities(chapter5)3. Cross-bordercrisismanagementandsolutionandcolleges(chapter6)
TheseprioritiesrepresenttheongoingworkfromCEIOPStoEIOPAinSolvencyIIandpensions,thestrengtheningofexistingcooperationwithourMembersand3L3col-leagues incolleges,crisissolutionanddatacollectionandfosteringchannelswithconsumers(representativeorganizations)andwithnewstakeholdersliketheESRB.
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Non-bindingLevel3guidelinesinvariousareasarebeingenvisagedandwillbefur-ther prepared by EIOPA in 2011 to support the convergent application of the newrules.TheultimateadoptiondatebyEIOPAwillbeMarch2012,intimeforMemberStates todecidewhether toapply theguidelinesor toexpress their intentionandrationalefornotadopting(comply-orexplain).
ThedraftingoftechnicalstandardsandLevel3guidelinesarebeingprioritisedaccord-ingtowhethertheyareconsideredessentialbeforetheimplementationofSolvencyII.Whereappropriate,EIOPAwillbeassessingthecostsandbenefitsofitsproposedtechnicalstandardsandguidelinesasanongoingrequirementforbetterregulation.IntheabsenceofpubliclyavailableLevel2measuresuntilJune2011,CEIOPSwillnotbeabletopubliclyconsultonLevel3guidelines,orontechnicalstandardsuntilthen.Therefore, informal pre-consultations will be held with selected stakeholders thathavebeenconsultedbytheCommissionduringtheconsultationonQIS5technicalspecificationsandthediscussionontheLevel2measures.
Solvencycapitalrequirements,ownfundsandtechnicalprovisionsPillar1elementsregardingcapitalrequirements,ownfundsandthecalculationoftechnicalprovisionswillbefine-tunedusingtheresultsofQIS5.
IntheframeofQIS5,CEIOPSwillhavecollecteddatatorefinethecalibrationforthenon-lifeandnon-SLThealthriskmodule. AJointWorkingGroupconsistingofrep-resentativesofAMICE,GroupeConsultatif,CEAandCROforumaswellasobserversfromtheEuropeanCommissionhasbeensetupbyCEIOPStodiscussthemostap-propriatecalibrationmethods.
FurtherworkonspecificissuesarisingfromQIS5,suchasthestandardisedscenariosforcatastropheriskinthestandardformulawillbeundertaken.
ActuarialguidelinesarebeingdevelopedtoassisttheactuarialfunctionunderSol-vencyIItocalcuationthebestestimateinaconvergentmanner.
AsQIS5istestingapproachesforgrandfatheringownfundselements,EIOPAwilllookintotheimpactandfeasibilityofgrandfatheringinthisarea.
InternalmodelsWithregardtointernalmodels,in2011,CEIOPSwillissuespecificLevel3guidelinesinareasthatitconsidersessentialforasmoothimplementationoftheprovisionsfortheinternalmodelsapprovalsetoutinSolvencyII.
CEIOPS’taskforceonpre-applicationwillcontinuetocarryoutinitiativesthatshouldcontributetoenhancesupervisoryconvergenceandconsistencyinthepre-applicationprocess,bothintermsofprocessesandoutcomes.Tothisend,CEIOPSwillorganisespecificinformalmeetingstoenhanceexperienceandproblemsfacedbySupervisory
ThislistdoesnotrepresentalltheworkthatwillbecarriedoutatEIOPA.EIOPAwillcontinuetheworkthathassuccessfullybeendoneonsupervisoryconvergenceandculture,byofferingawellestablishedtrainingprogram.For2011theaimistomorecloselyalignthistrainingprogramtotheneedsofsupervisors“outinthefield”andtotransferpolicyknowledgeintooperationaltools.Thedetailsaredescribedinchapter14.8.AlsoEIOPAwilldevelopnewinitiativesforconductingpeerreviewsbasedonthenewtasksoutlinedintheEIOPARegulationandbuildingontheexperiencefromthefirstpeerreviewexercisefinalisedin2010.Thedetailsaredescribedinchapter14.8.2.
Furtherareasofworkwillbetheworkdoneonaccounting, internationalrelationsandtheongoingworkonTransition,describedinChapterX.
14.2 Insurance
14.2.1SolvencyIITheimplementationdateoftheSolvencyIIframework(31December2012)iscom-ingcloserandMemberStatesaregettingpreparedtoimplementthenewframworkintheirnationallaw.EIOPAiscommittedtofurtherdevelopthefutureregime,andatthesametimeispreparingthenecessarytoolsandprocessestoensureasmoothtransition.
TheSolvencyIIworkplanfor2011willbecharacterisedbyaheavyregulatoryworkload at a time where the implementation efforts are increasing among MemberStatesandindustry.Coordinationbetweenthedifferentworkstreamsisofkeyim-portancetoensurethefinalconsistencyoftheLevel2measures,guidelinesandtech-nicalstandards.
Theresultsofthelastmajorquantitativeimpactstudybeforeimplementation,QIS5,willbeavailableinthefirstquarterof2011,andwillhelpidentifyingthemajorre-mainingregulatoryissuesthatneedtobesolvedbeforetheimplementation.
TheEuropeanCommissionisaimingtomakeaproposalfortheLevel2implementingmeasuresinJune2011.EIOPAwillfurthercontributewherenecessaryonkeyissuesinthefinalisationoftheLevel2proposalsandfinalmeasures.
TheprocessforEIOPA’sdeliverablesontechnicalstandardsandLevel3guidelinesisinfluencedbythetimingoftheproposalsandadoptionoftheLevel2measures,aswellastheadoptionoftheOmnibus2Directive,whichwillamendtheSolvencyIIDirectiveinrespectofthepowersofEIOPA.
ThedraftOmnibus2DirectiveforeseesthatEIOPAwillberequiredtodraftbindingtechnicalstandardsinvariousareasbyDecember201119.Thiswillcoveralargepartoftheworkprogrammefor2011.
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EIOPAwillcontinuetoconsultstakeholdersontheoverallreportingrequirementsinthecourseof2011.Duetotheimportanceoftheworkinthisareaandtheexpectedchallenges for the implementation, EIOPA considers this is one of the key areas inwhichstakeholdersneedtobeinvolved,andwherethepreparatoryworkfortheim-plementation needs to start early.Therefore, EIOPA aims to stabilize the reportingtemplatesassoonaspossible.
Authoritiesduringthepre-applicationprocessand/orthereviewofinternalmodels,andad-hoctraininginitiativeswillbecarriedout.
ReportinganddisclosureTheaimoftheworkonreportinganddisclosureistodevelopaharmonisedapproachthrough the introduction of common reporting templates and formats. Followinginformalconsultationonthedraftreportingtemplateswithselectedstakeholders,
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14.2.3EquivalenceThe2011CEIOPSdeliverablesforequivalencewillbedrivenbythe29October2010CallforAdvicefromtheEuropeanCommission20.Asperthis latestrequest,CEIOPSwillneed toproducebyendSeptember2011 its fullyconsulteduponadviceas toequivalenceassessmentsof theSwissandBermudiansupervisorysystemforrein-surance,groupsolvencycalculationandgroupsupervisionwhiletheJapanesesuper-visoryregimewillbeassessedonlyforreinsurancesupervisionequivalence.
BeginningDecember2010withCEIOPSwillinitiatesimultaneouslyitsassessmentsforeach3rdcountryindicatedbytheEuropeanCommission.CEIOPSassessmentswillbeundertakensimultaneouslybydedicatedassessmentteamswhichwillhavelessthanapproximately40weekstoproducetheirreports.
Thismakes theprocesshighlyresourcedemandingasall theseassessment teamswill need to have the necessary expertise, knowledge, supervisory experience andsize tomatch theextentof theassessmentaswellas thecomplexityof the thirdcountrysupervisorysystem.CEIOPSSecretariatandthenEIOPAwillfullysupporttheprocessbyallocatingresourcesandensuringcoordinationbetweentheassessmentteams.
ForeachassessmentCEIOPSwillensurefulltransparencyoftheprocesswith:★acallforevidenceasthefirststepoftheprojectand★apublicconsultationonfindings,beforesubmissionofitsadvicetotheEuropean
Commission.
Throughoutthesecondpartof2011,CEIOPSwillreviewandadaptitscurrentmeth-odologyonequivalenceassessments21andissueitasLevel3guidancetoEUgroup/individual supervisors. This will allow EU group/individual supervisors to pursueequivalence assessments in a consistent manner and will ultimately lead to en-hancedsupervisoryconvergenceonthematter.
TheLevel3methodologyforgroup/individualsupervisorswillincorporateallrelevantregulatorydevelopmentsfrom the1sthalfof2011aswellaspracticalexperiencefromCEIOPSinitial3rdcountryassessments.ItisexpectedthatthisLevel3guidancewillbeavailableforsupervisorsusetowardstheendof2011.
14.3 Occupational Pensions
The European Commission expects to initiate a review of the IORP Directive soonaftertheclosingdatefortheirconsultationontheGreenpaperonpensionson15November.RespondingtotheEuropeanCommission’sCallsforAdvicetocontributetothereviewandtoarelatedimpactassessmentislikelytoformthebiggestandmosthighprofilepartoftheEIOPA’sworkonoccupationalpensionsin2011.
GovernanceLevel3guidelinesonthesystemofgovernanceandORSAwillbethemajordeliver-ables expected for 2011 in this area.The guidelines on the system of governancewillcovertheriskmanagementsystemandtheinternalcontrolsystem,aswellasrequirementswithregardtofitandproper,outsourcingandthefourfunctionsintheinsuranceundertaking(riskmanagement,compliance, internalauditandactuarialfunction).
SupervisoryreviewprocessTheaimoftherequirementsonthesupervisoryreviewprocess(SRP)istobuildthegroundforaconsistentapproachtosupervisionacrosstheEUandconvergenceinsupervisorypractices.
Level3guidelinesonSRPwillcover theobjectivesandgeneralprinciplesofsuper-vision,theriskassessmentframeworkandprocessofsupervision,includingreview,supervisorypowersandactions.
Guidelinesonthetransparencyandaccountabilityofsupervisorswillbedevelopedinthecourseof2011,too.
GroupissuesOn the basis of the existing guidelines, as well as cross-sectoral and internationaldevelopments,CEIOPSwilldeveloptheguidelinesandtoolsthatarenecessarytoen-sureaproperfunctioningofsupervisorycollegesunderSolvencyII.
Level3guidelinesonintra-grouptransactionsandriskconcentrationwillbedevel-oppedtoprovideacommonbasisforallgroupsandsupervisorsinthisarea.
GroupissueswithrespecttoORSA,internalmodelsorreportingwillbedevelopedatthesametimeasthesolorequirementsinthoseareas.
Following the results of QIS5, guidelines for calculating the solvency position ofgroupswillbedeveloppedintheareaswheretheLevel1andLevel2arenotsuffi-cientlydetailed.
14.2.2GroupissuesunderthecurrentInsuranceGroupsDirectiveThesupervisionofcross-borderinsurancegroupsunderthecurrentregulatoryframe-workneedstobefurtherenhancedin2011.Tominimizethesupervisoryburdenoninsurance groups and to be better prepared for times of crisis, in 2011, EIOPA willworktowardstheconvergenceofsupervisorypracticesandsupervisoryco-operation.
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Atthetimeofwriting,neitherthecontentoftheCallforAdvicenorthetimetablefordeliveryhavebeenconfirmedbytheCommission.However,CEIOPSstandsreadytoadaptitsresourcesanddrawupdetailedplansforatimelydeliveryofitsadviceassoonastheinformationbecomesavailable.
Anumberofprojectsstartedwillbefinalisedin2011.Theseare:“Reportingtosuper-visoryauthorities”tobecompletedinQ1andaDCfocusedprojectwhichwillmaptheriskstomembersofDCschemes,includingtheanalysisofcertainselectedrisks,tobecompletedinQ3.
EIOPAwillalsopublisha2011updatetoits“ReportonMarketDevelopments”whichtracksoverallactivityinthemarketforEuropeancross-borderoccupationalpensionprovisionsince2007.
InDecember2009CEIOPSManagingBoardinstructedCEIOPStoundertakeaseper-atepieceofworkonPRIPsandpensions,whileshadowingthedevelopmentsinthe3L3TaskForceonnon-pensionPRIPS.The3L3TaskForcereportwascompletedinOc-tober2010.CEIOPSprojectwillcontinuein2011, takingintoaccounttheoutcomeof thePensionsGreenpaperconsultationandthescopeof thereviewof the IORPDirective.
14.4 Financial stability
InlinewithEIOPA’smandatethetasksinrelationtofinancialstabilityaimatidentify-ing,atanearlystage,trends,potentialrisksandvulnerabilitiesstemmingfromthemicro-prudentiallevelandtoinform,wherenecessary,theappropriateinstitutions.EIOPAwillmonitorstructuraldevelopmentsinthesectorsaswellasrisksrelatedtospecificproductswhererelevant.Furthermore,ariskdashboardwillbedevelopedincooperationwiththeESRBandotherESAs.Alsoaharmonised,pan-Europeanstresstestfortheinsurancesectorwillbecarriedout.ThestresstestwillbedevelopedincooperationwiththeESRBandaimatusingcommonmethodologiesforassessingtheeffectofeconomicscenariosonaninstitutions’financialposition.
AsinpreviousyearsEIOPAwilldeliver,intheAutumnof2011,anannualassessmentofsectordevelopmentshighlightingimplicationsforfinancialstability,withapro-visionalreportintheSpringof2011outliningmainmarkettrendssincetheendof2010.EIOPAwillreportregularlyonfinancialconditionsandfinancialstabilityinthe(re)insuranceandoccupationalpensionssectorsintheEuropeanUniontotheEuro-peanEconomicandFinancialCommittee(EFC)–FinancialStabilityTable.
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●Insuranceintermediariesplayacentralroleinthedistributionandsellingofinsur-anceproducts.CEIOPSprovidedtheCommissionwithdraftAdviceontherevisionoftheInsuranceMediationDirectiveinNovember2010.EIOPAwillcontinuetopro-videassistancetotheEuropeanCommission,whererequested,withitslegislativeproposaltorevisetheInsuranceMediationDirective(IMD),whichisexpectedattheendof2011.
●EIOPAwillalsocontinuetoprovideinput intotheEuropeanCommission’spolicy-makingwithregardstoInsuranceGuaranteeSchemes(IGS).Followingthepublica-tionofaWhitePaper inJuly2010,CEIOPSprovideddetailed input intotheCom-mission’sconsultation.EIOPAwillcontinueinasimilarveinin2011asandwhentheEuropeanCommissionpublishesadraftDirectivetoensurethatIGSexistinallMemberStatesandthattheycomplywithaminimumsetofdesignfeatures.
Asever,intakingalltheseinitiativesandanyfurtherwork-streamsrelatingtocon-sumer protection forward, EIOPA will seek close cooperation with its StakeholderGroups.
14.6 Cross-border crisis management and solution and colleges
14.6.1CrossbordercrisismanagementTheRegulationclearlystatestheexpectationsforthenewsupervisorybodies:“TheAuthorityshouldbeabletorequirenationalsupervisoryauthoritiestotakespecificactiontoremedyanemergencysituation.”(recital20a)
EIOPAshouldthereforebepreparedtotakeactionwhenanemergencysituationarises,from thefirstdayon.BecauseEIOPAwillberelativelysmallat thestart, thisworkshallbeorganisedonaprojectmanagementbasis,wherebycoordinationwillberunbyEIOPA’sSecretariatwherebyMemberssupplyinputtosetupacrisismanagementsystem.
Workinthisareaalsorequiresahighlevelofcooperationbetweenthe3EuropeanSupervisoryAuthorities,theESRB,CouncilandEuropeanCommission.Jointworkonthisareahasalreadystarted.
Inco-operationwiththebankingandsecuritiessupervisors,in2011CEIOPSwillcon-tinuetomonitorcontagionrisks,suchasfeedbackloopsbetweenthefinancialsectorandtherealeconomy;cross-sectorholdingsandexposures;marketconfidence;andchangesinproducts,assetpricesanddeleveraging,betweenthedifferentsectorsaswellaswithinfinancialconglomeratesThefindingswillbereportedinthecontextofthejointthreeLevel3workoncross-sectorriskstofinancialstabilityinEurope.
EIOPAwillfurtherdevelopitsdatabaseofcurrentandhistoricaldataforoccupationalpensionfunds,insuranceandreinsuranceundertakingsintheEuropeanUnion,gath-eredinthecontextofEIOPA’sFinancialStabilityReports.
LookingforwardtotheintroductionofSolvencyII,EIOPAwillhaveregardtothatdatatobecollectedforthepurposesofsinglereportingstandards,duetocomeintoforcein2012,also includesasmuchdataaspossiblerequiredforfinancialstabilitypur-posesincludingthoseofESRB.
FollowingthenewregulationonbothEIOPAandESRBaframeworkforexchangeofinformationwillbeestablishedincooperationwithESRBandotherESAs.
14.5 Consumer protection
EIOPAwillbetakingonsignificantnewpowersandtasks inthefieldofconsumerprotectionandfinancialactivitiesunderitsempoweringRegulation,whichpresentinterestingnewchallengesandopportunities.LiketheotherEuropeanSupervisoryAuthorities–ESMAandEBA,EIOPAwill invariablyneedtimetocomefullytogripswiththesenewtasksandpowers.
Thetasksincludeanalysingconsumertrends,reviewingfinancialliteracyinitiatives,developing industry training standards, contributing to common disclosure rules,monitoringexisting/newfinancialactivities,establishingaCommitteeonFinancialInnovation and temporarily prohibiting/restricting certain financial activities22. Astructuredprocessforputtingthesenewtasksintoeffectwillbeputintoplaceoverthecomingmonths.
Inaddition,EIOPAwillcontinuetoprovideassistancetotheCommissionwithexist-ingpolicyinitiatives:●Consumersshouldfeelconfidentandempoweredtomaketherightchoiceswhen
purchasingfinancialproductssuchasinvestment-basedinsurance.Inthisrespect,CEIOPSMemberscontributedtoa3L3TaskForcereportonPackagedRetailInvest-mentProducts(PRIPs),whichwassubmittedtotheCommissionon6October2010.It ispossible thatEIOPAwill takeupfurtherwork in thisarea in2011,under theaegisoftheJointCommitteeoftheESAs,oncetheCommissionhaspublishedleg-islativeproposalsonPRIPs.
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14.7 Colleges
EIOPA’sroleinCollegeswillbedistinctivelydifferentthanthemoresupportingroleCEIOPShad.Recital22oftheRegulationstates:
“TheAuthorityshouldcontributetopromotingandmonitoringtheefficient,effec-tive and consistent functioning of the Colleges of Supervisors and in that respecthavealeadingroleinensuringaconsistentandcoherentfunctioningofsupervisorycollegesforcross-borderinstitutionsacrosstheUnion.ItshouldthereforehavefullparticipationrightsinCollegesofSupervisorswithaviewtostreamliningthefunc-tioning of and the information exchange process in colleges and to foster conver-genceandconsistencyacrosscollegesintheapplicationofEuropeanUnionlaw.”
Startinginthesecondquarterof2011EIOPAstaffwillactivelyparticipateasmem-bers inCollegemeetings.ThisworkwillalsofeedintoSolvencyIIwork-streamsonsupervisoryCollegesbyclarifying,strengtheningandstreamliningtheroleandfunc-tioningofthecurrentColleges.
EIOPA will work on the implementation of a common IT tool for the exchange ofinformationwithinthecurrentCollegesandthefutureCollegesofSupervisors,bothinnormalandcrisistimes,withtheaimtohavethetoolreadybybeginningof2012.
14.8 Supervisory culture, convergence and cooperation
14.8.1SupervisorycultureThenewRegulationestablishingEIOPA(Article14)stresses the importanceof theCommittee’sroleinthedevelopmentofcommonsupervisorycultureintheEuropeanUnionthroughfacilitatingtechnicaltrainingandtheexchangeofstafftobuildcom-monsupervisoryskillsandapproaches.
Trainingplaysakeyroleinthedevelopmentofcommonsupervisorypracticesinthefieldofinsurance,reinsuranceandoccupationalpensionsanditisoneofthemaintoolsforachievingacommonsupervisoryculture.
The topics covered in the trainings are in line with the work developed by CEIOPSWorkingGroupsandCommittees,whereSolvencyIIisoneofthemaindrivers,followedbyFinancialStability,OccupationalPensions,ConsumerProtectionandConvergence.
UnderSolvencyII,giventheongoingdevelopmentoftheL2measures,mostofthetrainingscarriedoutuntilrecentwerefocusingonanupdateoftheworkinprogress.TheimplementationofSolvencyIIbyend2012willbefollowedbyashiftfromregu-lationtosupervision.Theaimforthefuturetrainingsistotargetoperationalsupervi-sorsandtopreparethembetterfortheSupervisionunderSolvencyII,byintroducingapracticalapproachasthepreferredmethodologyoftraining.
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14.9 Further areas of work
14.9.1AccountingAsinthepast,EIOPAwillcontinuetofollowdevelopmentsintheEuropeanaccount-ingenvironment,especiallybyfollowingtheworkof,andprovidinginputto,theEu-ropeanFinancialReportingAdvisoryGroup(EFRAG)inthecontextoftheapplicationofInternationalFinancialReportingStandard(IFRS)intheEuropeanUnion.EIOPAwillcontinuetofollowtheIASB’sagendacloselyandprovideinputinareasaffectingin-suranceand/oroccupationalpensions.
14.9.2InternationalrelationsIntheEuropeanSystemofFinancialSupervision,thenewEuropeanSupervisoryAu-thoritieswillhaveagreaterinternationalrolethanthecurrentLevel3Committees.AccordingtotheESAregulation,giventheglobalisationoffinancialservicesandtheincreasedimportanceofinternationalstandards,ESAsshouldfosterthedialogueandcooperationwithsupervisorsoutsidetheUnion.
Combined with the power of the ESAs to draft regulatory standards to which theEuropeanCommissioncangivebindinglegaleffect,EIOPAwillseekgreaterrepresen-tationinrelevantinternationalorganisationsinordertorealiseitsstandardsettingroleininsuranceandpensions.Atthesametime,EIOPAwillcontinuetodevelopitsinternationalrelationsbyholdingregulatorydialoguesandmaintainingaclosecon-tactwiththirdcountriesincludingtheUS,China,JapanandLatin-America.
Equally,EIOPAwillassistinpreparingequivalencedecisionspertainingtosupervisoryregimesinthirdcountries.CEIOPSworkonpreparingtheequivalenceassessmentsis likelytoaddafurthermomentumtotheregulatorydialogues,bringingforwarddiscussionsonspecificaspectsofglobalstandards.
14.9.3TransitionAnumberofspecificproceduresneedtobeimplementedinthecourseof2011 toenableEIOPAtobecompliantwithCommissionrequirementsforEuropeanAgencies.ThisrelatestoanumberofInternalcontrolstandardstomeasure,steerandcontroltheeffectiveness,abilityandintegrityoftheorganization.InthetableinannexIasummaryoftheinternalcontrolsandplannedimplementationisset.
Furthermore, staff growth will have an impact on the organization, as its size willalmostdoubleduring2011,givingchallengestoincorporatenewcomersintheexist-ingcultureandvaluesofEIOPAwhileatthesametimegivingroomforgrowthandopeningnewareasofexpertiseintheorganization.ThefurtherdevelopmentofHRpoliciesandpracticeswithintheorganizationisparamountfor thesuccessof thistransition.
ThemainfindingsofthequestionnaireonthePreparednessofInsuranceSupervisorstoImplementSolvencyIIconductedinJune2010haveshownthattrainingplaysamajorroleinspreadingtheSolvencyIIculturewithintheorganisations.Thisshowsthe importanceofcommonsupervisoryculture linked to the trainingatEuropeanlevel,whichnotonlycomplementsbutalsoenhancestrainingatnationallevel.
Followingprioritiescanbeidentifiedinthisarea:●InlinewiththedevelopmentsfortrainingunderEIOPA,theaimforthefuturetrain-
ingsistotargetoperationalsupervisorsandtopreparethembetterforsupervisionunderSolvencyII,byintroducingapracticalapproachasthepreferredmethodologyoftraining.
●Training will focus on the difference between the new and the old supervisoryframeworkinordertoallowsupervisorstofocusonthenewrequirements.
●Othergeneraltoolswillbedeveloped:awebsite-basedlibrary(mainlyonSolvencyII, but also from other areas); case-studies as an ongoing requirement for work-inggroupswhendevelopingregulatorymeasures; thepossibilityformemberstorequest ad hoc training on specific areas (such as Solvency II internal modellingframework; assessment of the (group) internal model during the pre-applicationprocess)ortohosttherepetitionofastandardseminar;exchangingquestionsandanswersbetweenSolvencyIIimplementationprojectmanagersthroughtheEIOPAmembersareawebsite,etc.
CEIOPSexpectstorunthefollowingtrainingeventsin2011:●14sectorseminars,including1–2adhoctrainingsorrepetitionsofstandardseminars●3cross-sectorseminars●2publicevents:thePublicHearingonQIS5andtheEIOPAConference
Asinpreviousyears,thetrainingprogrammewilldrawheavilyonthesupportfromCEIOPSMembersandworkinggroupexperts,incoordinationwiththeSecretariatstaff.
In the context of its work on developing common supervisory culture, CEIOPS be-lievesintheimportanceofstaffexchangesintheformofstudyvisitsandsecond-mentsamongsupervisors.CEIOPSsupervisoryculturewebpagewasre-designedin2010.Thenew,friendlierpageincorporatesthelatestITimprovementstofacilitateinteractionsbetweenCEIOPSanditsMembersandamongMembersthemselvesonmattersrelatingtotrainingandtheexchangeofstaff.
14.8.2SupervisoryPracticesReviewPanelTheRegulationonEIOPAprovidesfornewspecificpeerreviewtaskswhichtheRe-viewPanelwillstartimplementingin2011.Thereforebymid2011theReviewPanelwillfinaliseaprioritizationexercisethroughanalysisandplanningactivities,intend-edtolaythefoundationfortheimplementationofthetasksproposedbytheEIOPARegulation.Byend2011,theReviewPanelwillstartimplementingthepeerreviewtasksofhighestpriority.
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AnnExES
A 2: Financial statements
Income and Expense Account
Actual2009Euro
Actual2010Euro
Budget2010Euro
available 2010Euro
● Revenues Membershipfees,gross 2.890.334,00 4.183.000,00 4.183.000,00 FundingEuropeanCommission 166.666,00 1.100.000,00 1.100.000,00 Rebatetomembers -280.801,85 0,00 0,00 Membershipfees,net 2.776.198,15 5.283.000,00 5.283.000,00 Interestincome 22,074.18 6.283,20 0,00 Releaseofprioryearaccruedexpense 19.548,01 0,00 0,00 OtherIncome 169,70 12.828,80 0,00 Total revenues � 2.817.990,04 � 5.302.112,00 � 5.302.112,00
● Current expense Salariesandwages � 1.432.324,04 � 2.038.697,51 � 2.416.000,00 � 377.302,49 Rentalexpense � 330.895,47 � 496.110,43 � 495.000,00 � -1.110,43 Travellingandentertainment � 138.573,81 � 175.252,09 � 201.500,00 � 26.247,91 Officesupplies � 23.380,10 � 73.787,15 � 64.500,00 � -9.287,15 Organisationandmeetings � 268.979,74 � 137.760,55 � 210.400,00 � 72.639,45 Sectoralandcross-sectoralseminars � - � 169.659,42 � 168.000,00 � -1.659,42 Telecommunicationexpense � 33.361,84 � 58.160,31 � 54.800,00 � -3.360,31 Deliveryandcommunication � 5.826,85 � 8.056,89 � 7.800,00 � -256,89 Printing � 63.862,00 � 125.598,97 � 65.000,00 � -60.598,97 EDPinstallationandmaintenance � 107.049,15 � 167.994,65 � 121.000,00 � -46.994,65 Website � 61.843,44 � 287.382,35 � 266.000,00 � -21.382,35 Professionalfees � 91.522,91 � 133.093,39 � 108.000,00 � -25.093,39 Miscellaneousexpense � 54.148,73 � 6.613,93 � 5.000,00 � 1.386,07 Total expense � 2.611.768,08 � 3.875.167,64 � 4.183.000,00 � 307.832,36● Result for the year (ordinary business) � 206.221,96 � 1.426.944,36 � 1.100.000,00
Retainedearningsbeginningofyear 789.535,47 995.757,43 Retained earnings at end of year � 995.757,43 � 2.422.701,79
● Analysis of Assets and Liabilities 31.12.2009 31.12.2010 CashandBankAccounts � 2.379.459,38 � 2.854.696,80 Leaseguaranteedeposit � 95.447,43 � 146.029,71 Membershipfeereceivables � 0,00 � 0,00 Wagetaxandsocialsecurityreceivables
duefromsecondingauthorities� 138.038,48 � 114.357,09
ReceivableEuropeanCommissionfunding
� 116.000,00 � 622.772,30
Otherreceivables � 9.493,37 � 41.862,86 Prepaidexpenses � 7.184,75 � 9.164,77 Total assets � 2.745.623,41 � 3.788.883,53● Less: Liabilities and Accrued Expense Accountspayables 97.219,92 82.844,29 Prepaidmembershipfee 1.237.225,36 663.457,35 Payrollliabilitiesduetoseconding
authorities 346.887,33 366.812,50
Accruedexpense 40.025,60 186.224,35 Wagetaxliabilities 28.507,77 66.843,25 Total liabilities � 1.749.865,98 � 1.366.181,74● Total committee members‘ equity � 995.757,43 � 2.422.701,79
EuropeanCommissionmaytakelegalactionagainstMemberStatessuspectedofbreachofCommunityLaw.
Level 1
EuropeanCommissionadoptsformalproposalforDirective/Regulationafterafullconsultationprocess(includingadvicefromCEIOPS).
Level 2
EuropeanCommission,afterconsultingtheEIOPC,requestsadvicefromCEIOPSontechnicalimplementingmeasures.
Level 3
CEIOPSworksonrecommendations,guidelinesandstandards(onareasnotcoveredbyEUlegislation),peerreview,andcomparessupervisory
practicestoenhancetheirconvergence.
Level 4
EuropeanCommissionchecksMemberStates’compliancewithEUlegislation
CEIOPSpreparesmeasuresinconsultationwithmarketparticipants,end-usersandconsumers,andsubmitsthemtoEuropeanCommission.
EuropeanCommissionexaminesthemeasuresandmakesaproposaltotheEIOPC.
EIOPCvotesonproposal
EuropeanCommissionadoptsmeasures
AgreementonframeworkprinciplesanddefinitionofimplementingpowersinDirective/Regulation.
European Parliament
Keptfullyinformedandcan
adoptaResolutionifm
easuresexceedim
plementingpow
ers
European Parliament Council
A 1: CEIOPS role in the Lamfalussy procedure
Lamfalussy-modelfromtheperspectiveofCEIOPS
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A 3: List of CEIOPS Members and Observers
Members
AustriaFinanzmarktaufsichtsbehörde(FMA)Otto-Wagner-Platz51090WienAustriaTel:+43124959-0Fax:+43124959-6099www.fma.gv.at
BelgiumBanking,FinanceandInsuranceCommission(CBFA)RueduCongrès–Congresstraat,12–141000BrusselsBelgiumTel:+3222205211Fax:+3222205890www.cbfa.be
BulgariaFinancialSupervisionCommission33,SharPlaninaStreet1303SofiaBulgariaTel:+35929404999Fax:+35928294324www.fsc.bg
CyprusInsuranceCompaniesControlService(ICCS)P.O.Box233641682NicosiaCyprusTel:+35722602980Fax:+35722660135www.mof.gov.cy
CyprusSupervisoryAuthorityofOccupationalRetirementBenefitsFunds7ByronAvenue1465NicosiaCyprusTel:+35722401628Fax:+35722672984www.mlsi.gov.cy/sid
Czech RepublicCzechNationalBankNapríkope2811503Praha1CzechRepublicTel:+420224411111Fax:+420224412404or+420224413708www.cnb.cz
DenmarkFinanstilsynetAarhusgade1102100CopenhagenDenmarkTel:+4533558282Fax:+4533558200www.finanstilsynet.dk
EstoniaFinancialSupervisionAuthority/FINANTSINSPEKTSIOONSakalaStreet415030TallinnEstoniaTel:+3726680500Fax:+3726680501www.fi.ee
FinlandFinancialSupervisoryAuthorityP.O.Box10300101HelsinkiFinlandTel:+3581083151Fax:+358108315328www.fin-fsa.fi
FranceAutoritédeContrôlePrudentiel(ACP)61rueTaitbout75436ParisCedex09FranceTel:+33155504141Fax:+33155504150www.acam-france.fr
GermanyBundesanstaltfürFinanzdienstleistungs-aufsicht(BaFin)GraurheindorferStraße10853117BonnGermanyTel:+4922841080Fax:+4922841081550www.bafin.de
GreecePrivateInsuranceSupervisoryCommittee(PISC)Ypatias5GR10557AthensGreeceTel:+302103272610/620Fax:+302103230847www.pisc.gr
HungaryPénzügyiSzervezetekÁllamiFelügyeleteHungarianFinancialSupervisoryAuthorityKrisztinaKörút391013BudapestHungaryTel:+3614899100Fax:+3614899102www.pszaf.hu
IrelandThePensionsBoardVerschoyleHouse28/30LowerMountStreetDublin2IrelandTel:+35316131900Fax:+35316318602www.pensionsboard.ie
CentralBankofIrelandP.O.BoxNo559DameStreetDublin2IrelandTel:+35312246000Fax:+35316716561www.centralbank.ie
ItalyCommissionediVigilanzasuiFondiPensione(COVIP)ViainArcione,7100187RomaItalyTel:+3906695061Fax:+390669506271www.covip.it
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ItalyIstitutoperlaVigilanzasulleAssicurazioniPrivateediInteresseCollettivo(ISVAP)ViadelQuirinale,2100187RomaItalyTel:+3906421331Fax:+390642133206www.isvap.it
LatviaFinancialandCapitalMarketCommissionKunguiela1Riga,LV-1050LatviaTel:+37167774800Fax:+37167225755www.fktk.lv
LithuaniaInsuranceSupervisoryCommissionoftheRepublicofLithuaniaUkmergesstr.222LT07157VilniusLithuaniaTel:+37052431370Fax:+37052431399www.dpk.lt
LuxembourgCommissariatauxAssurances(CAA)7,boulevardRoyal2449LuxembourgTel:+3522269111Fax:+352226910www.commassu.lu
LuxembourgCommissiondeSurveillanceduSecteurFinancier110,routed’Arlon2991LuxembourgTel:+352262511Fax:+35226251601www.cssf.lu
MaltaMaltaFinancialServicesAuthorityNotabileRoadAttardMaltaBKR14Tel:+35621441155Fax:+35621441188www.mfsa.com.mt
NetherlandsDeNederlandscheBank(DNB)P.O.Box981000ABAmsterdamTheNetherlandsTel:+31205249111Fax:+31205242500www.dnb.nl
PolandPolishFinancialSupervisionAuthorityKomisjaNadzoruFinansowegoPl.PowstancowWarszawy100-950WarszawaPolandTel:+4822262-50-00Fax:+482226251-11(95)www.knf.gov.pl
PortugalInstitutodeSegurosdePortugal(ISP)AvenidadaRepública,761600-205LisboaPortugalTel:+351217903100Fax:+351217938568www.isp.pt
RomaniaInsuranceSupervisoryCommission(CSA)18th Amiral Constantin Balescu Street,sector1Bucharest011954RomaniaTel:+40213167880Fax:+40213167864www.csa-isc.ro
RomanianPrivatePensionSystemSupervisionCommission(RSCPPS)90–92CaleaSerbanVoda,Sector4Bucharest040213RomaniaTel.:+40213301035Fax:+40213301031www.csspp.ro
SlovakiaNationalBankofSlovakiaImrichaKarvasa181325BratislavaSlovakiaTel:+421257873301Fax:+421257873453www.nbs.sk
SloveniaInsuranceSupervisionAgencyTrgrepublike31000LjubljanaSloveniaTel:+38612528600Fax:+38612528630www.a-zn.si
SpainDirecciónGeneraldeSegurosyFondosdePensiones(DGSFP)MinisteriodeEconomíayHaciendaPaseodelaCastellana,4428046MadridSpainTel:+34913397100Fax:+34913397113www.meh.es
SwedenFinancialSupervisoryAuthorityP.O.Box7821,Brunnsgatan310397StockholmSwedenTel:+4687878000Fax:+468241335www.fi.se
United KingdomFinancialServicesAuthority(FSA)25TheNorthColonnade,CanaryWharfLONDONE145HSUnitedKingdomTel:+442070661000Fax:+442070661099www.fsa.gov.uk
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United KingdomThePensionsRegulatorNapierHouse,TrafalgarPlaceBRIGHTONBN14DWUnitedKingdomTel:+441273811800Fax:+441273627688www.thepensionsregulator.gov.uk
IcelandFinancialSupervisoryAuthority(FME)(Fjármálaeftirlitid)Su urlandsbraut,32108ReykjavíkIcelandTel:+3545252700Fax:+3545252727www.fme.is
LiechtensteinFinancialMarketAuthority(FMA)Heiligkreuz8P.O.Box2799490VaduzLiechtensteinTel:+4232367377Fax:+4232367376www.fma-li.li
NorwayFinanstilsynet(TheFinancialSupervisoryAuthorityofNorway)Postboks1187SentrumNO-0107OsloNorwayTel:+4722939800Fax.+4722630226www.finanstilsynet.no
European CommissionDirectionGénéraleMarchéIntérieurRuedelaLoi,2001049BrusselsBelgiumTel:+3222957954Fax:+3222993075www.ec.europa.eu/internal_market
A 4: List of Abbreviations
3L3 ThreeLevel3CommitteesAML/CFT Anti-MoneyLaundering/
CombatingtheFinancingofTerrorism
AMLTF Anti-MoneyLaunderingTaskForce
CEBS CommitteeofEuropeanBankingSupervisors
CEIOPS CommitteeofEuropeanInsuranceandOccupationalPensionsSupervisors
CESR CommitteeofEuropeanSecuritiesRegulators
CLD ConsolidatedLifeInsuranceDirective
Co-Cos Co-ordinationCommitteesCRD CapitalRequirementsDirectiveCP ConsultationpaperEBA EuropeanBankingAuthorityECOFIN EUCouncilofMinistersEEA EuropeanEconomicAreaEFC EconomicandFinancial
CommitteeEFCC EuropeanFinancial
ConglomeratesCommitteeEFC-FST EFC-FinancialStabilityTableEFRAG EuropeanFinancialReporting
AdvisoryGroupEIOPA EuropeanInsuranceandOccu-
pationalPensionsAuthorityEIOPC EuropeanInsuranceandOccu-
pationalPensionsCommitteeESA EuropeanSupervisoryAuthorityESFS EuropeanSystemofFinancial
SupervisorsESMA EuropeanSecuritiesand
MarketsAuthorityESRB EuropeanSystemicRiskBoardEU EuropeanUnionFATF TheFinancialActionTaskForce
FCD FinancialConglomeratesDirectiveFINMA SwissFinancialMarketSupervi-
soryAuthorityFSC FinancialServicesCommitteeIAIS InternationalAssociation
ofInsuranceSupervisorsIASB InternationalAccounting
StandardsBoardIFRS InternationalFinancial
ReportingStandardsIGS InsuranceGuaranteeSchemesILS InsuranceLinkedSecuritiesIMD InsuranceMediationDirectiveIOPS InternationalOrganisation
ofPensionSupervisorsIORPs InstitutionsforOccupational
RetirementProvisionIORPDirective Directive2003/41/ECofthe
EuropeanParliamentandoftheCouncilof3June2003ontheactivitiesandsupervisionofInstitutionsforoccupationalretirementprovision
IWCFC InterimWorkingCommitteeonFinancialConglomerates
JCFC JointCommitteeonFinancialConglomerates
MCR MinimumCapitalRequirementMiFID MarketsinFinancial
InstrumentsDirectiveMoU MemorandumofUnderstanding
NAIC USNationalAssociationofInsuranceCommissioners
ORSA OwnRiskandSolvencyAssessment
PRIP PackagedRetailInvestmentProduct
QIS4 FourthQuantitativeImpactStudy
Observers
A
96/97
QIS5 FifthQuantitativeImpactStudySCR SolvencyCapitalRequirementSPV SpecialPurposeVehicleSRP SupervisoryReviewProcess
TFIG TaskForceonInternalGover-nance
UCITS UndertakingsforCollectiveInvestmentsinTransferableSecurities
VaR ValueatRisk
1 https://eiopa.europa.eu/en/publications/submissions-to-the-ec/index.html2 https://eiopa.europa.eu/en/publications/submissions-to-the-ec/index.html3 https://www.ceiops.eu/requests-for-advice/index.html4 https://www.ceiops.eu/fileadmin/tx_dam/files/requestsforadvice/Equivalence-October-2010/
EC-call-for-advice-Equivalence-Nov.2010.pdf5 https://www.ceiops.eu/consultations/consultation-papers/december-2010/
call-for-evidence-solvency-ii-equivalence/index.html6 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/submissionstotheec/
ReportIORPdirective.pdf7 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/submissionstotheec/
CEIOPS-CEIOPS-issues-paper-on-cross-border-IORPs.pdf8 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/submissionstotheec/
CEIOPS-note-to-EC-on-cross-border-activity-of-IORPs.pdf9 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/reports/
CEIOPS-IORP-Market-Developments-Report-2010.pdf10 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/reports/
CEIOPS-IORP-Ring-fencing-in-Stress-Situations-20100705.pdf11 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/reports/
2010112-CEIOPS-Report-on-Management-Oversight-and-Internal-Controls-in-IORPs.pdf12 https://eiopa.europa.eu/fileadmin/tx_dam/files/publications/submissionstotheec/
20101115-CEIOPS-response-to-the-EC-Green-Paper-on-pensions.pdf13 https://eiopa.europa.eu/fileadmin/tx_dam/files/pressreleases/
20100316-CEIOPS-Press-Release-Stress-Test-EU-insurance-sector.pdf14 https://www.ceiops.eu/fileadmin/tx_dam/files/publications/reports/SII-Preparedness-20100708/
CEIOPS-Report-Preparedness-SII-20100708.pdf15 https://eiopa.europa.eu/publications/reports/index.html16 AllMembershaveimprovedtheirunderstandingoftheprovisionsoftheGeneralProtocoland/orcorrectedtheir
initialrepliesafteranothercheckoftheactualcaseswithregardto91provisions,andthat15Membershaveimprovedcomplianceinrelationto33provisions.GeneralProtocol,BudapestProtocol,HelsinkiProtocol:
17 GeneralProtocol,BudapestProtocol,HelsinkiProtocol:www.eiopa.europa.eu/publications/protocols/index.html18 http://www.c-ebs.org/documents/Publications/Other-Publications/Comment-letters-by-CEBS/Other-Areas/
2010-08-31-(CEBS-response-to-EU-Commissions-green-.aspx19 16areashavebeenidentifiedatthetimeofdraftingtheworkplan.20 https://www.ceiops.eu/requests-for-advice/index.html21 https://www.ceiops.eu/publications/standards-and-more/index.html22 AlltaskstakenfromthewordingofoldArticle6a(newArticle9)ofthedraftRegulationestablishingEIOPA,
althoughnotarticulatedinfull
A 5: Endnotes
A