Prudential Regulation Authority Rulebook

20.1

When 2.1(3) applies, 4 to 14, 16 to 19 and External Audit 2 to 4 apply with any necessary changes at the level of the insurance holding company or mixed financial holding company which does not have its head office in the UK or Gibraltar, third country insurance undertaking or third country reinsurance undertaking unless:

1. (1) subject to 20.2, the third country in which that undertaking has its head office is assessed to be equivalent under provisions implementing Article 260 of the Solvency II Directive, Article 380 and 380A of the delegated act, or an equivalence direction under paragraph 12 of Schedule 1 of The Equivalence Determinations for Financial Services and Miscellaneous Provisions (Amendment etc) (EU Exit) Regulations 2019; or
2. (2) in the absence of equivalent group supervision referred to in Article 260 of the Solvency II Directive, the PRA has specified other methods in accordance with provisions implementing Article 262 of the Solvency II Directive, Article 380 and 380A of the delegated act, or an equivalence direction under paragraph 12 of Schedule 1 of The Equivalence Determinations for Financial Services and Miscellaneous Provisions (Amendment etc) (EU Exit) Regulations 2019.

[Note: Art. 262 of the Solvency II Directive]

20.2

The changes to this rule are effective from 23:00 on 31/12/2020.

20.1(1) does not apply where, in the case of temporary equivalence under Article 260(5) of the Solvency II Directive, there is a Solvency II undertaking in the group that has a balance sheet total that exceeds the balance sheet total of the parent undertaking situated outside of the UK and Gibraltar.

[Note: Art. 260(7) of the Solvency II Directive]

20.3

The changes to this rule are effective from 23:00 on 31/12/2020.

When calculating the solvency of a group falling within 2.1(3) for the purpose of 20.1, a relevant insurance group undertaking must treat the parent undertaking (being an insurance holding company which does not have its head office in the UK or Gibraltar or a third country insurance undertaking or a third country reinsurance undertaking), solely for the purposes of that calculation, as a UK Solvency II firm to which 2.1(1)(a) applies.

[Note: Art. 262 of the Solvency II Directive]

20.4

The changes to this rule are effective from 23:00 on 31/12/2020.

Where the parent undertaking referred to in 2.1(3) is itself a subsidiary undertaking of an insurance holding company or mixed financial holding company which does not have its head office in the UK or Gibraltar or a third country insurance undertaking or a third country reinsurance undertaking, 20.1 applies at the level of either:

1. (1) the ultimate parent undertaking which is an insurance holding company or mixed financial holding company which does not have its head office in the UK or Gibraltar or a third country insurance undertaking or a third country reinsurance undertaking; or
2. (2) such other parent undertaking as the PRA may determine in accordance with Regulation 36A of the Solvency 2 Regulations.

[Note: Art. 263 of the Solvency II Directive]