No C 180/6 Official Journal of the European Communities 20. 7. 90 
II 
(Preparatory Acts) 
COMMISSION 
Amended proposal for a Council Directive amending, particularly as regards motor vehicle 
liability insurance, First Council Directive 73/239/EEC and Second Council Directive 
88/357/EEC on the coordination of laws, regulations and administrative provisions relating to 
direct insurance other than life assurance 
COM(90) 278 final — SYN 179 
(Submitted by the Commission pursuant to Article 149(3) of the EEC Treaty on 21 June 1990) 
(90/C 180/05) 
INITIAL PROPOSAL 
Proposal for a Council Directive amending, particularly 
as regards motor vehicle liability insurance, First Council 
Directive 73/239/EEC, and Second Council Directive 
88/357/EEC on the coordination of laws, regulations and 
administrative provisions relating to direct insurance 
other than life assurance and laying down provisions to 
facilitate the effective exercise of freedom to provide 
services, and amending Directive 73/239/EEC 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Articles 57 (2) 
and 66 thereof, 
Having regard to the proposal from the Commission, 
In cooperation with the European Parliament, 
Having regard to the opinion of the Economic and 
Social Committee, AMENDED PROPOSAL 
Proposal for a Council Directive amending, particularly 
as regards motor vehicle liability insurance, First Council 
Directive 73/239/EEC, and Second Council Directive 
88/357/EEC on the coordination of laws, regulations and 
administrative provisions relating to direct insurance 
other than life assurance 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Visas unchanged 
20. 7. 90 Official Journal of the European Communities NoC 180/7 
INITIAL PROPOSAL AMENDED PROPOSAL 
Whereas in order to develop the internal insurance 
market the Second Council Directive 88/357/EEC of 
22 June 1988 on the coordination of laws, regulations 
and administrative provisions relating to direct insurance 
other than life assurance and laying down provisions to 
facilitate the effective exercise of freedom to provide 
services and amending Directive 73/239/EEC (*), here­
inafter referred to as the 'Second Directive', made it 
easier for insurance undertakings having their head 
office in the Community to provide services in the 
Member States, thus making it possible for policyholders 
to have recourse not only to insurers established in their 
own country, but also to insurers which have their head 
office in the Community and are established in other 
Member States; Whereas in order to develop the internal insurance 
market, Directive 88/357/EEC ('), hereinafter referred 
to as the 'Second Directive', on the coordination of laws, 
regulations and administrative provisions relating to 
direct insurance other than life assurance and laying 
down provisions to facilitate the effective exercise of 
freedom to provide services and amending Directive 
73/239/EEC (2), hereinafter referred to as the 'First 
Directive', on the coordination of laws, regulations and 
administrative provisions relating to the taking-up and 
pursuit of the business of direct insurance other than life 
assurance, made it easier for insurance undertakings 
having their head office in the Community to provide 
services in the Member States, thus making it possible for 
policyholders to have recourse not only to insurers 
established in their own country, but also to insurers 
who have their head office in the Community and are 
established in other Member States; 
Whereas the scope of the provisions of the Second 
Directive specifically concerning freedom to provide 
services excluded certain risks, the application to which 
of the said provisions was rendered inappropriate at that 
stage by the specific rules adopted by the Member States' 
authorities, owing to the nature and social implications 
of such provisions; whereas those exclusions were to be 
re-examined after the Second Directive had been in force 
for a certain period; Five following recitals unchanged 
Whereas one of the exclusions concerned motor vehicle 
liability insurance, other than carrier's liability; 
Whereas, however, when the Second Directive was 
adopted the Commission gave an undertaking to present 
to the Council as soon as possible a proposal concerning 
freedom to provide services in the area of insurance 
against civil liability in respect of the use of motor 
vehicles (other than carrier's liability); 
Whereas, subject to the provisions of the Second 
Directive concerning compulsory insurance, it is appro­
priate to provide for the possibility of large risk 
treatment, within the meaning of Article 5 of the said 
Directive, for the said insurance class of motor vehicle 
liability; 
Whereas large risk treatment should also be envisaged 
for insurance covering damage to or loss of land motor 
vehicles and land vehicles other than motor vehicles; 
C) OJ No L 172, 4. 7. 1988, p. 1. (') OJ No L 172, 4. 7. 1988, p. 1. 
(2) OJ No L 228, 16. 8. 1973, p. 3. 
No C 180/8 Official Journal of the European Communities 20. 7. 90 
INITIAL PROPOSAL AMENDED PROPOSAL 
Whereas the Second Directive laid down that the risks 
which may be covered by way of Community 
co-insurance within the meaning of Council Directive 
78/473/EEC of 30 May 1978 on the coordination of 
laws, regulations and administrative provisions relating 
to Community co-insurance (') were to be large risks as 
defined in the Second Directive,* whereas the inclusion 
by the present Directive of the motor insurance classes in 
the large risks definition of the Second Directive will 
have the effect of including those classes in the list of 
classes which may be covered by way of Community 
co-insurance; 
Whereas Council Directive 72/166/EEC of 24 April 
1972 on the approximation of the laws of the Member 
States relating to insurance against civil liability in 
respect of the use of motor vehicles, and to the 
enforcement of the obligation to insure against such 
liability (2), as last amended by Directive 84/5/EEC (3), 
built on the green card system and the agreements 
between the national motor insurers' bureaux in order to 
enable green card checks to be abolished; 
Whereas to ensure the continued proper functioning of 
the green card system and the agreements between the 
national motor insurers' bureaux it is appropriate to 
require insurance undertakings providing motor liability 
insurance in a Member State by way of provision of 
services to join and participate in the financing of the 
bureau of that Member State; Unchanged 
Whereas the Second Council Directive 84/5/EEC of 30 
December 1983 on the approximation of the laws of the 
Member States relating to insurance against civil liability 
in respect of the use of motor vehicles, as last amended 
by Directive 90/232/EEC (4), required the Member 
States to set up or authorize a body (guarantee fund) 
with the task of providing compensation to victims of 
accidents caused by uninsured or unidentified vehicles; 
Whereas it is also appropriate to require insurance 
undertakings providing motor liability insurance in a 
Member State by way of provision of services to join and 
participate in the financing of the guarantee fund set up 
in that Member State to pay compensation to the victims 
of uninsured or unidentified vehicles; Whereas it is also approporiate to require insurance 
undertakings providing motor liability insurance in a 
Member State by way of provision of services to join and 
participate in the financing of the guarantee fund set up 
in that Member State; 
(*) OJ No L 151, 7. 6. 1978, p. 25. 
(2) OJ No L 103, 2. 5. 1972, p. 1. 
O OJ No L 8, 11. 1. 1984, p. 17. 
(") OJ No L 129, 19. 5. 1990, p. 33. 
20. 7. 90 Official Journal of the European Communities NoC 180/9 
INITIAL PROPOSAL AMENDED PROPOSAL 
Whereas in order to ensure that third party claimants are 
not prejudiced or put to greater inconvenience where the 
motor liability insurer is operating by way of the 
provision of services rather than by way of an estab­
lishment Member States shall require that insurance 
undertakings intending to provide services in this 
insurance class shall nominate a claims settlement 
representative to be responsible for the processing and 
settlement of third party claims; Unchanged 
Whereas in the field of motor liability insurance the 
protection of the interests of persons suffering damage 
who could pursue claims in fact concerns each and 
everyone and that it is therefore advisable to ensure that 
these persons are not prejudiced or put to greater incon­
venience where the motor liability insurer is operating by 
way of provision of services rather than by way of estab­
lishment; whereas for this purpose, and in so far as the 
interests of these persons are not sufficiently safeguarded 
by the rules applying to the supplier of services in the 
Member State in which it is established, it should be 
provided that the Member State of provision of services 
shall require the undertaking to appoint a representative 
resident or established in its territory to collect all 
necessary information in relation to claims and shall 
possess sufficient powers to represent the undertaking in 
relation to persons suffering damage who could pursue 
claims, including the payment of such claims, and to 
represent it or, where necessary, to have it represented 
before the courts and authorities of that Member State in 
relation to these claims; whereas this representative may 
also be required to represent the undertaking before the 
competent authorities of the Member State of provision 
of services in relation to the control of the existence and 
validity of a motor vehicle liability insurance policy; 
Whereas provision should be made for a flexible 
procedure to make it possible to assess reciprocity with 
third countries on a Community basis; whereas the aim 
of this procedure is not to close the Community's 
financial markets but rather, as the Community intends 
to keep its financial markets open to the rest of the 
world, to improve the liberalization of the global 
financial markets in third countries; whereas, to that 
end, this Directive provides for procedures for nego­
tiating with third countries and, as a last resort, for the 
possibility of taking measures involving the suspension of 
new applications for authorization or the restriction of 
new authorizations, 
No C 180/10 Official Journal of the European Communities 20. 7. 90 
INITIAL PROPOSAL AMENDED PROPOSAL 
HAS ADOPTED THIS DIRECTIVE: HAS ADOPTED THIS DIRECTIVE: 
Article 1 
For the purposes of this Directive: Article 1 
For the purposes of this Directive: 
(a) 'First Directive'means Directive 73/239/EEC ('); 
(b) 'Second Directive'means Directive 88/357/EEC; 
(c) 'vehicle' means a vehicle as defined in Article 1 (1) of 
Directive 72/ 166/EEC (2); (a) 'First Directive'means Directive 73/239/EEC; 
(b) 'Second Directive'means Directive 88/357/EEC; 
(c) 'vehicle' means a vehicle as defined in Article 1 (1) of 
Directive 72/166/EEC; 
(d) 'bureau'means a national insurers' bureau as defined 
in Article 1 (3) of Directive 72/166/EEC; 
(e) 'guarantee'Jund'means the body referred to in Article 
1 (4) of Directive 84/5/EEC Q). (d) 'bureau'means a national insurers' bureau as defined 
in Article 1 (3) of Directive 72/166/EEC; 
(e) 'guarantee Jund'means the body referred to in Article 
1 (4) of Directive 84/5/EEC; 
(f) 'parent undertaking' means a parent undertaking as 
defined in Articles 1 and 2 of Directive 
83/349/EECO; 
(g) 'subsidiary' means a subsidiary undertaking as 
defined in Articles 1 and 2 of Directive 
83/349/EEC, any subsidiary undertaking of a 
subsidiary undertaking shall also be regarded as a 
subsidiary of the parent undertaking which is at the 
head of those undertakings. 
Article 2 
In Article 5 (d) of the First Directive the phrase 'risks 
classified under classes 8, 9, 13 and 16 of point A of the 
Annex' in the first paragraph of point (iii) is hereby 
replaced by 'risks classified under classes 3, 8, 9, 10, 13 
and 16 of point A of the Annex'. Article 2 
In Article 5 (d) of the First Directive the phrase 'risks 
classified under classes 8, 9, 13 and 16 of point A of the 
Annex' in the first paragraph of point (iii) is hereby 
replaced by the following: 
'risks classified under classes 3, 8, 9, 10, 13 and 16 of 
point A of the Annex'. 
Article 3 
The second and third indents in the second paragraph of 
Article 12 (2) of the Second Directive are hereby deleted. Unchanged 
0) OJ No L 228, 16. 8. 1973, p. 3. 
(2) OJ No L 103, 2. 5. 1972, p. 1. 
O OJ No L 8, 11. 1. 1984, p. 17. C) OJ No L 193, 18. 7. 1983, p. 1. 
20. 7. 90 Official Journal of the European Communities NoC 180/11 
INITIAL PROPOSAL AMENDED PROPOSAL 
Article 4 
Article 22 (1) of the Second Directive is hereby replaced 
by the following: Article 4 
Article 22 (1) of the Second Directive is hereby replaced 
by the following: 
'1. Every establishment must inform its supervisory 
authority in respect of operations effected by way of 
provision of services of the amount of the premiums, 
without deduction of re-insurance, receivable by 
Member State and by group of classes. The groups of 
classes shall be defined as follows: '1. Every establishment must inform its supervisory 
authority in respect of operations effected by way of 
provisions of services of the amount of the premiums, 
without deduction of re-insurance, receivable by 
Member State and by group of classes. The groups of 
classes shall be defined as follows: 
— accident and sickness (1 and 2), — accident and sickness (1 and 2), 
— motor insurance (3, 7 and 10), motor insurance (3, 7 and 10, the figures relating to 
class 10, excluding carrier's liability, being specified), 
— fire and other damage to property (8 and 9), fire and other damage to property (8 and 9), 
aviation, marine and transport (4, 5, 6,7, 11 and 12), aviation, marine and transport (4, 5, 6,7, 11 and 12), 
— general liability (13), general liability (13), 
credit and suretyship (14 and 15), credit and suretyship (14 and 15), 
other classes (16, 17 and 18). other classes (16, 17 and 1! 
The supervisory authority of each Member State shall 
forward this information to the supervisory authorities of 
each of the Member States of provision of services.' The supervisory authority of each Member State shall 
forward this information to the supervisory authorities of 
each of the Member States of provision of services.' 
Article 5 Article 5 
The following Article 12a is hereby inserted in Title III 
of the Second Directive: The following Article 12a is hereby inserted in Title III 
of the Second Directive: 
Article 12a 
1. This Article shall apply where an undertaking, 
through an establishment situated in a Member State, 
covers a risk classified under No 10 of point A of the 
Annex to the First Directive which is situated in another 
Member State. Article 12a 
1. This Article shall apply where an undertaking, 
through an establishment situated in a Member State, 
covers a risk, other than carrier's liability, classified 
under No 10 of point A of the Annex to the First 
Directive which is situated in another Member State. 
NoC 180/12 Official Journal of the European Communities 20. 7. 90 
INITIAL PROPOSAL AMENDED PROPOSAL 
2. The Member State of provision of services shall 
require the undertaking to become a member of and 
participate in the financing of its national bureau and its 
national guarantee fund. 2. The Member State of provision of services shall 
require the undertaking to become a member of and 
participate in the financing of its national bureau and its 
national guarantee fund. 
The undertaking shall not, however, be required to make 
any payment or contribution to the bureau or fund of 
the Member State of provision of services in respect of 
risks covered by way of provision of services other than 
one calculated, on the same basis as for undertakings 
covering risks in class No 10 through an establishment in 
that State, by reference to its premium income from that 
class in that State or the number of risks in that class 
covered there. The undertaking shall not, however, be required to make 
any payment or contribution to the bureau or fund of 
the Member State of provision of services in respect of 
risks covered by way of provision of services other than 
one calculated, on the same basis as for undertakings 
covering risks, other than carrier's liability, in class No 
10 through an establishment in that State, by reference 
to its premium income from that class in that State or the 
number of risks in that class covered there. 
3. The Member state of provision of services shall 
require the undertaking to ensure that persons pursuing 
claims arising out of events occurring in its territory are 
not placed in a less favourable situation as a result of the 
fact that the undertaking is covering a risk in class 10 by 
way of provision of services rather than through an 
establishment in that State. 3. Insurance undertakings providing services shall be 
required to comply with the rules concerning the cover 
of aggravated risks which are in force in the Member 
State of provision of services in so far as they apply to 
established undertakings. 
In particular, the Member State of provison of services 
may require the undertaking to nominate a represen­
tative resident or established in its territory who shall be 
responsible for the handling of claims and possess 
sufficient powers to bind the undertaking in relation to 
third parties and to represent it in relations with the 
courts of that Member State. 4. The Member State of provision of services shall 
require the undertaking to ensure that persons pursuing 
claims arising out of events occurring in its territory are 
not placed in a less favourable situation as a result of the 
fact that the undertaking is covering a risk, other than 
carrier's liability, in class 10 by way of provision of 
services rather than through an establishment in that 
State. 
The representative, who may be an employee of the 
undertaking, shall limit his activities on behalf of that 
undertaking to the handling and settlement of such 
claims. 
Notwithstanding Article 3, the nomination of the 
representative shall not in itself constitute the opening of 
a branch or agency for the purpose of Article 6 (2) (d) of 
the First Directive and the representative shall not be an 
establishment within the meaning of Article 2 (c) of this 
Directive.' For this purpose, the Member State of provision of 
services shall require the undertaking to appoint a 
representative resident or established in its territory who 
shall collect all necessary information in relation to 
claims, and shall possess sufficient powers to represent 
the undertaking in relation to persons suffering damage 
who could pursue claims, including the payment of such 
claims, and to represent it or, where necessary, to have it 
represented before the courts and authorities of that 
Member State in relation to these claims. 
The representative may also be required to represent the 
undertaking before the competent authorities of the State 
of provision of services with regard to checking the 
existence and validity of motor vehicle liability insurance 
policies. 
20. 7. 90 Official Journal of the European Communities NoC 180/13 
INITIAL PROPOSAL AMENDED PROPOSAL 
The Member State of provision of services may not 
require that appointee to undertake activities on behalf 
of the undertaking which appointed him other than those 
set out in the preceding paragraph. The appointee shall 
not take up the business of direct insurance on behalf of 
the said undertaking. 
The appointment of the representative shall not in itself 
constitute the opening of a branch or agency for the 
purpose of Article 6 (2) (b) of the First Directive and the 
representative shall not be an establishment within the 
meaning of Article 2 (c) of this Directive.' 
Article 6 
1. The following subparagraph is added to Article 15 
(1) and to Article 16 (1) of the Second Directive: 
'Each Member State within the territory of which an 
undertaking intends to provide services coverings risks in 
class 10, other than carrier's liability, may require that 
the undertaking: 
— notify the name and address of the claims represen­
tative referred to in Article 12a (3), 
— produce a declaration that the undertaking has 
become a member of the national bureau and the 
national guarantee fund of the Member State of 
provision of services.' 
2. The following subparagraph is added to Article 21 
(2) of the Second Directive: 
'Each Member State may require that the name and 
address of the representative of the insurance under­
taking also appear in the abovementioned documents.' 
Article 7 
Article 27 (1), last subparagraph, of the Second Directive 
is hereby replaced by the following: 
'The derogation allowed from 1 January 1995 shall only 
apply to contracts covering risks classified under classes 
3, 8, 9, 10, 13 and 16 situated exclusively in one of the 
four Member States benefiting from the transitional 
arrangements.' 
No C 180/14 Official Journal of the European Communities 20. 7. 90 
INITIAL PROPOSAL AMENDED PROPOSAL 
Article 8 
1. The heading of Title III of the First Directive is 
replaced by the following: 
'TITLE III A 
Rules applicable to agencies or branches established 
within the Community and belonging to undertakings 
whose head offices are outside the Community.' 
2. The following heading is placed after Article 29 of 
the First Directive: 
'TITLE III B 
Rules applicable to subsidiaries of parent undertakings 
governed by the laws of a third country and to 
acquisitions of participations by such parent under­
takings.' 
Article 9 
The following Articles 29a and 29b shall be added to 
Title III B of the First Directive: 
Article 29a 
The competent authorities of the Member States shall 
inform the Commission: 
(a) of any authorization of a direct or indirect 
subsidiary, one or more parent undertakings of 
which are governed by the laws of a third country. 
The Commission shall inform the insurance 
Committee established by Council Decision . . .; 
(b) whenever such a parent undertaking acquires a 
holding in a Community insurance undertaking 
which would turn the latter into its subsidiary. The 
Commission shall inform the insurance Committee 
established by Council Decision. ... accordingly. 
When authorization is granted to the direct or 
indirect subsidiary of one or more parent under­
takings governed by the law of third countries, the 
structure of the group shall be specified in the notifi-
cation which the competent authorities shall address 
to the Commission. 
Official Journal of the European Communities NoC 180/15 
INITIAL PROPOSAL AMENDED PROPOSAL 
Article 29b 
1. The Member States shall inform the Commisson of 
any general difficulties encountered by their insurance 
undertakings in establishing themselves or carrying on 
their activities in a third country. 
2. Initially no later than six months before the 
application of this Directive, and thereafter periodically, 
the Commission shall draw up a report examining the 
treatment accorded to Community insurance under­
takings in third countries, in the terms referred to in 
paragraphs 3 and 4, as regards establishment and the 
carrying on of insurance activities, and the acquisition of 
holdings in third country insurance undertakings. The 
Commission shall submit those reports to the Council, 
together with any appropriate proposals. 
3. Whenever it appears to the Commission, either on 
the basis of the reports referred to in paragraph 2 or on 
the basis of other information, that a third country is not 
granting Community insurance undertakings effective 
market access comparable to that granted by the 
Community to insurance undertakings from that third 
country, the Commission may submit proposals to the 
Council for the appropriate mandate for negotiation with 
a view to obtaining comparable competitive opportunities 
for Community insurance undertakings. The Council 
shall decide by a qualified majority. 
4. Whenever it appears to the Commission, either on 
the basis of the reports referred to in paragraph 2 or on 
the basis of other information, that Community 
insurance undertakings in a third country are not 
receiving national treatment offering the same 
competitive opportunities as are available to domestic 
insurance undertakings and that the conditions of 
effective market access are not being fulfilled, the 
Commission may initiate negotiations in order to remedy 
the situation. 
In the circumstances described in the first subparagraph 
above, it may also be decided at any time, and in 
addition to initiating negotiations, in accordance with 
the procedure laid down in the Council Decision 
referred to in Article 29a, that the competent authorities 
of the Member States must limit or suspend their 
decisions 
— regarding requests pending at the moment of the 
decision or future requests for authorizations, 
and 
— regarding the acquisition of holdings by direct or 
indirect parent undertakings governed by the laws of 
the third country in question. 
NoC 180/16 Official Journal of the European Communities 20. 7. 90 
INITIAL PROPOSAL AMENDED PROPOSAL 
The duration of the measures referred to may not exceed 
six months. 
Before the end of that six-month period, and in the light 
of the results of the negotiations, the Council may, 
acting on a proposal from the Commission, decide by a 
qualified majority that the measures shall be continued. 
Such limitations or suspension may not apply to the 
setting up of subsidiaries by insurance undertakings or 
their subsidiaries duly authorized in the Community, or 
to the acquisition of holdings in Community insurance 
undertakings by such institutions or subsidiaries. 
5. Whenever it appears to the Commission that one of 
the situations described in paragraphs 3 and 4 has arisen, 
the Member States shall inform it at its request: 
(a) of any request for the authorization of a direct or 
indirect subsidiary, one or more parent undertakings 
of which are governed by the laws of the third 
country in question; 
(b) of any plans for such an undertaking to acquire a 
holding in a Community insurance undertaking such 
that the latter would become the subsidiary of the 
former. 
This obligation to provide information shall lapse once 
an agreement is concluded with the third country 
referred to in paragraph 3 or 4 when the measures 
referred to in the second and third subparagraphs of 
paragraph 4 cease to apply. 
6. Measures taken under this Article shall comply with 
the Community's obligations under any international 
agreements, bilateral or multilateral, governing the 
taking up and pursuit of the business of insurance under­
takings.' 
20. 7. 90 Official Journal of the European Communities NoC 180/17 
INITIAL PROPOSAL 
Article 6 
Member States shall amend their national provisions to 
comply with this Directive within .. . months of the date 
of its notification (') and shall forthwith inform the 
Commission thereof. 
The provisions amended in accordance with this Article 
shall be applied within . . . months of the date of the 
notification of the Directive. 
Article 7 
This Directive is addressed to the Member States. AMENDED PROPOSAL 
Article 10 
Member States shall amend their national provisions to 
comply with this Directive within 18 months of the date 
of its notification and shall forthwith inform the 
Commission thereof. 
The provisions amended in accordance with this Article 
shall be applied within 24 months of the date of the noti­
fication of the Directive. 
Article 11 
This Directive is addressed to the Member States. 
(') This Directive was notified to Member States on ... .