The new Belgian Supervision Act, the Act of 13 March 2016 concerning the status and supervision of insurance and reinsurance undertakings, has been published in the Belgian Official Gazette of yesterday 23 March 2016 and is already entered into force.
This Act is aimed at the partial transposition into Belgian law of the Solvency II Directive and replaces the Insurance Supervision Act of 1975 and the Reinsurance Act of 2009.
The goal of the Act is to protect policyholders, insureds and beneficiaries of insurance contracts and transactions, and to ensure the solidity and proper functioning of the financial system. The Act relates to the establishment and the activities, as well as the supervision of insurance and reinsurance undertakings which are active in Belgium. The most important aspects are the solvency and risk management, regulatory norms and obligations, governance, etc.
The Act consists of 9 books and 759 articles. Below, you will already find a short overview of the 9 books:
Book I. General provisions
This book sets out the goal, scope of application, definitions and "protected denominations" (under which the use of the concepts of "insurance undertaking", "reinsurance undertaking", "insurer" or "reinsurer").
Book II. Insurance and reinsurance undertakings under Belgian law
This book concerns: the taking-up of business, the conditions governing business (including solvency and governance provisions, etc.), the particular provisions concerning specific types of insurance undertakings (especially the mutual insurance associations, undertakings which are subject to specific regulation because of their size and local insurance associations), the supervision of undertakings, the supervision of insurance and reinsurance groups, and the additional supervision on financial conglomerates, provisions concerning insurance and reinsurance undertakings in difficulty or in irregular situations and, finally, provisions concerning the termination of the authorization.
Book III. Insurance and reinsurance undertakings under foreign law
This book regulates the exercise of activities in Belgium by insurance or reinsurance undertakings which are incorporated under the laws of another EU member state or of a third country.
Book IV. Penalty damages and other measures
This book concerns the competences of the Belgian National Bank to impose penalties.
Book V. Sanctions
This book provides for administrative as well as criminal sanctions.
Book VI. The international private law rules relating to reorganisation and winding-up proceedings applicable to insurance undertakings
This book contains provisions concerning reorganisation measures, about bankruptcy and other winding-up proceedings which are based on insolvency, about winding-up proceedings which are not based on insolvency concerning insurance undertakings which are incorporated under the laws of third countries, about the winding up of specific funds and also about the common rules concerning reorganization and winding-up proceedings.
Book VII. Material aspects of winding-up proceedings
In this book, provisions have been included concerning the specific rules in case of a bankruptcy proceeding, specific rules in case of a winding-up proceeding within the meaning of article 183 of the Belgian Companies Code, common provisions concerning the different winding-up proceedings and other cases of concourse of creditors.
Book VIII. Final, amending, transitional and abolishment provisions
The Act contains transitory measures, a.o. regarding the obligation to set up a remuneration committee, a risk committee and a risk management function.
Book IX. Entry into force
The Act entered into force on 23 March 2016.
