«

»

Dub
08

Since the United Kingdom and its dependent territories will become a third country from 1 January 2021, the deposit of assets covering technical provisions in creditworthy establishments established in these zones must be in line with the legal and regulatory provisions applicable to deposits outside the European Economic Area (EEA). In addition, Luxembourg law requires the insurance company to manage separately and separately from its own assets the assets that constitute its insurance liabilities. These representative assets must be deposited with a custodian bank. A deposit agreement binds the insurance company and the bank and must be approved by the Office of the Insurance Commissioner (CAA) before depositing representative assets. Insurance creditors (insurance takers and/or beneficiaries) therefore have the status of preferred creditors in relation to the separate assets corresponding to their contracts. For no legitimate reason, assets currently deposited with a UK credit institution or domiciled in a UK-dependent territory must be transferred to an EEA credit institution. In accordance with Article 55 of CAA Regulation No. 15/03 of December 7, 2015 relating to insurance and reinsurance companies as amended (CAA Regulation 15/03), the deposit of assets in accordance with credit institutions established outside the EEA is only permitted on the reasoned request of the insurance company concerned. In addition, Circular 16/9 provides that such a deposit can only take place in the country of the non-EEA custodian`s headquarters. The corresponding asset deposits in the UK or its dependent territories do not require changes to existing deposit agreements. Deposits of the corresponding assets of Luxembourg insurance companies with branches established in the United Kingdom or its dependent territories are reviewed and a transfer of matching assets to an EEA custodian may be necessary. According to the CAA`s assessment of existing deposit agreements, this applies only to the deposits of Luxembourg life insurance companies.

You can access the information advisory by clicking on this link (available only in French for now). On 2 April 2020, the Luxembourg Insurance Commissioner`s Office (CAA) issued a briefing note highlighting the impact of Brexit on the application of circular CAA 16/09 (Circular 16/9) on the deposit of transferable securities and liquidity used as assets for technical provisions of direct insurance companies and pension funds subject to the supervision of the CAA (Information). Since deposits in the United Kingdom or its dependent territories have not been subject to specific prior authorization from the CAA, the CAA is not informed of the existence of a ground that could be recognized as legitimate for the filing. However, the CAA reminds insurance companies that Circular 16/9 in life insurance considers it a legitimate reason that the choice of custodian outside the EEA is an essential condition for the conclusion of contracts with corresponding assets deposited. If this condition is met, certain measures must be taken vis-à-vis the client and only assets that are part of a special fund or specialized fund can, according to CAA, be deposited in the third country.