INSURANCE BUSINESS (CAPTIVE INSURANCE UNDERTAKINGS AND CAPTIVE REINSURANCE UNDERAKINGS) REGULATIONS

INSURANCE BUSINESS (CAPTIVE INSURANCE UNDERTAK-

INGS AND CAPTIVE REINSURANCE UNDERTAKINGS)

SUBSIDIARY LEGISLATION 403.11

INSURANCE BUSINESS (CAPTIVE INSURANCE

UNDERTAKINGS AND CAPTIVE REINSURANCE

UNDERAKINGS) REGULATIONS

3rd November, 2003

LEGAL NOTICE 334 of 2003, as amended by Legal Notices 288 of 2007

and 395 of 2015.

The title of these regulations is the Insurance Business

(C a p ti v e In s u r a nc e Un de r tak i ng s a n d C a pt iv e R e in s u r a nc e

Undertakings) Regulations.

(1)

In these regulations, unless the context otherwise

requires -

"the Act" means the Insurance Business Act;

"captive insurance undertaking" means an authorised insurance

undertaking, owned either by a financial undertaking, other than an

insurance or reinsurance undertaking or a group of insurance or

reinsurance undertakings within the meaning of article 2 of the Act,

or by a non-financial undertaking, the purpose of which is to

provide insurance cover exclusively for the risks of the undertaking

or undertakings to which it belongs or of an undertaking or

undertakings of the group of which it is a member;

"captive reinsurance undertaking" means an authorised

reinsurance undertaking, owned either by a financial undertaking,

other than an insurance or reinsurance undertaking or a group of

insurance or reinsurance undertakings within the meaning of article

2 of the Act, or by a non-financial undertaking, the purpose of

which is to provide reinsurance cover exclusively for the risks of

the undertaking or undertakings to which it belongs or of an

undertaking or undertakings of the group of which it is a member;

"the competent authority" means the Malta Financial Services

Authority established by the Malta Financial Services Authority

Act;

''financial undertaking" means any of the following entities

(a) a credit institution, a financial institution or an

ancillary banking services undertaking within the

meaning of sub-paragraphs (1), (17) and (22) of

paragraph (1) of Article 3 of Directive 2013/36/EU

respectively;

(b) an insurance undertaking, or a reinsurance undertaking

or an insurance holding company within the meaning

of Article 212(1)(f) of the Solvency II Directive;

(c) an investment firm or a financial institution within the

meaning of Article 4(1)(1) of Directive 2004/39/EC;

or

(d) a mixed financial holding company within the meaning

INSURANCE BUSINESS (CAPTIVE INSURANCE UNDER-

TAKINGS AND CAPTIVE REINSURANCE UNDERTAKINGS)

of Article 2(15) of Directive 2002/87/EC;

"Insurance Rules" has the same meaning as is assigned to it by

article 2 of the Act.

(2) Words and expressions which are also used in the Act shall

in these regulations have the same meanings as in the Act.

For the better carrying out of the provisions of these

regulations, the competent authority may issue Insurance Rules

which may contain such incidental, supplementary and

consequential provisions as appear to the competent authority to be

expedient for the purposes of these regulations.

(1) The Act and any regulations and Insurance Rules made

thereunder shall apply to a captive insurance undertaking and a

captive reinsurance undertaking, in the same manner and to the

same extent, unless specified otherwise, as they apply to an

authorised insurance undertaking or an authorised reinsurance

undertaking whose head office is in Malta, subject to the following

provisions of this regulation.

(2) Article 7(9) of the Act shall apply as if for the period of six

months prescribed therein there was substituted the period of three

months.

(3) Article 10(2) of the Act shall apply only to the extent that a

captive insurance undertaking or a captive reinsurance undertaking

may, with the approval of the competent authority given in writing,

appoint an insurance manager.

(4)

Article 20(1)(b) of the Act shall not apply.

(5) Where it is proposed to carry out a transfer of business of

insurance where either the transferor or the transferee are captive

insurance undertakings or captive reinsurance undertakings, the

provisions of Part VIII of the Act shall apply subject to the

following provisions of this subregulation

(a) article 33(2) of the Act shall apply as follows

(i) paragraph (a) thereof shall not apply;

(ii) paragraph (b) thereof shall apply to the extent

only of requiring that a notice approved for this

purpose by the competent authority be sent by

the transferor to every policyholder affected by

the scheme and every other person who claims

an interest in a policy included in the proposed

transfer and has given notice of his claim to the

transferor; and

(iii) paragraph (c) thereof shall apply;

(b) article 35(3) of the Act shall apply as follows

(i) paragraph (a) thereof shall not apply; and

(ii) paragraph (d)(i) thereof shall not apply, unless

otherwise determined by the Financial Services

Tribunal.

INSURANCE BUSINESS (CAPTIVE INSURANCE UNDERTAK-

INGS AND CAPTIVE REINSURANCE UNDERTAKINGS)

(6)

Article 39(2)(a)(i) of the Act shall not apply.

(7)

Articles 44 and 47 of the Act shall not apply.

(8)

Article 48(2) of the Act shall not apply.

(9)

Article 48A of the Act shall not apply.

(10) Part XI of the Act shall not apply to a captive insurance

undertaking or a captive reinsurance undertaking.

Every company which, immediately before the coming into

force of these regulations, was authorised to carry on business of

affiliated insurance under article 7 of the Act, shall, from the date

of the coming into force of these regulations, be subject to the

provisions of these regulations.