S.L. 403.17 Art. 8Ultimate parent undertaking at national level.

(1) The competent authority may subject the ultimate Malta Solvency II parent to group supervision, where:

(a) the ultimate parent undertaking at Union level referred to in regulation 7, has its head office in a Member State or EEA State, other than Malta;

(b) the ultimate parent undertaking at Union level referred to in regulation 7, has not obtained permission in accordance with Articles 237 or 243 of the Solvency II Directive, for the ultimate Malta Solvency II parent, which is its subsidiary, to be subject to regulations 29 and 30; and

(c) the competent authority is one of the authorities responsible for the supervision of an individual insurance or reinsurance undertaking in a group and is not the group supervisor.

(2) The competent authority shall:

(a) before taking the decision to exercise supervision in accordance with sub-regulation (1), consult both the group supervisor and the ultimate parent undertaking at Union level; and

(b) where such a decision has been taken, explain its decision to both the group supervisor and the ultimate parent undertaking at Union level.

(3) Where the competent authority is the group supervisor of a group and a decision has been taken to subject the ultimate parent insurance or reinsurance undertaking, insurance holding company or mixed financial holding company to group supervision, pursuant to Article 216(1) of the Solvency II Directive, the competent authority shall inform the college of supervisors in accordance with article 32B(3)(a) of the Act.

(4) (a) Where the competent authority is one of the authorities responsible for the supervision of an individual insurance or reinsurance undertaking in a group and is not the group supervisor, and takes a decision in accordance with regulation 8(1) and (2) or concludes an agreement in accordance with regulation 8(11) to (13), regulations 9 to 43 shall apply mutatis mutandis, subject to paragraph (b) and to sub-regulations (1)(b),

(5) to (10) of this regulation.

(b) The decision or agreement referred to in paragraph (a) is subject to the decision which the competent authority may take, to restrict group supervision of the ultimate Malta Solvency II parent to one or more of the following:

(i) Articles 218 to 243 of Title III, Chapter II, Section 1 of the Solvency II Directive;

(ii) Articles 244 and 245 of Title III, Chapter II, Section 2 of the Solvency II Directive;

(iii) Article 246 of Title III, Chapter II, Section 3 of the Solvency II Directive.

(5) Where the competent authority decides to apply Articles 218 to 243 of the Solvency II Directive to the ultimate Malta Solvency II parent or concludes an agreement in accordance with sub-regulations (11) to (13), the choice of method made in accordance with Article 220 of the Solvency II Directive by the group supervisor in respect of the ultimate parent undertaking at Union level referred to in Article 215 of the Solvency II Directive, shall be recognised as determinative and applied by the competent authority.

(6) Where the competent authority decides to apply Articles 218 to 243 of the Solvency II Directive to the ultimate Malta Solvency II parent or concludes an agreement in accordance with sub-regulations (11) to (13), the competent authority shall recognise as determinative and apply any permission granted in accordance with Articles 231 or 233(5) of the Solvency II Directive, to the ultimate parent undertaking at Union level referred to in regulation 7 to calculate the group Solvency Capital Requirement, as well as the Solvency Capital Requirement of insurance undertakings and reinsurance undertakings in the group, on the basis of an internal model.

(7) In the situation referred to in sub-regulation (6), where the competent authority considers that the risk profile of the ultimate Malta Solvency II parent deviates significantly from the internal model approved at Union level, and as long as that undertaking does not properly address the concerns of the competent authority, the competent authority may decide to impose a capital add-on to the group Solvency Capital Requirement of that undertaking resulting from the application of such model or, in exceptional circumstances, where such capital add-on would not be appropriate, to require that undertaking to calculate its group Solvency Capital Requirement on the basis of the standard formula.

(8) The competent authority shall explain the decisions taken in accordance with sub-regulations (6) or (7) to both the Malta Solvency II parent and the group supervisor.

(9) Where the competent authority is the group supervisor of a group and a decision has been taken pursuant to Article 216(4) of the Solvency II Directive, the competent authority shall inform the college of supervisors in accordance with article 32B(3)(a) of the Act.

(10) Where the competent authority decides to apply Articles 218 to 243 of the Solvency II Directive to the ultimate Malta Solvency II parent that undertaking shall not be permitted to introduce, in accordance with regulations 27 to 32, an application for permission to subject any of its subsidiaries to Articles 238 and 239 of the Solvency II Directive.

(11) Where the competent authority makes a decision in accordance with sub-regulation (1), the competent authority may conclude an agreement with the European regulatory authorities in other Member States or EEA States where another related ultimate parent undertaking at national level, other than Malta, is present, with a view to carrying out group supervision at the level of a subgroup covering Malta and such other Member States or EEA States.

(12) Where the competent authority has concluded an agreement as referred to in sub-regulation (11), group supervision shall not be carried out at the level of any ultimate parent undertaking referred to Article 216 of the Solvency II Directive, present in Member States or EEA States, other than the Member States or EEA States where the subgroup referred to in sub-regulation (11) is located.

(13) Where an agreement is concluded in accordance with sub-regulation (11), the competent authority shall explain the agreement to the group supervisor and to the ultimate parent undertaking at Union level.

(14) Where the competent authority is the group supervisor of a group and an agreement to carry out group supervision at subgroup level in the Member States or EEA States concerned, has been concluded pursuant to Article 217 of the Solvency II Directive, the competent authority shall inform the college of supervisors in accordance with article 32B(3)(a) of the Act.