WRITTEN QUESTION E-0172/03

by Theresa Villiers (PPE-DE) to the Commission

(29 January 2003)

Subject: Equitable Life

1. Has the Commission conducted a full investigation into the role the UK Government played in the fall of Equitable Life? If not, why not, and if so what were the findings?

2. Does the Commission believe that the UK Government has breached EU regulations on life insurance, in its handling of the Equitable Life scandal?

3. If the UK Government is found to be in breach of EU legislation on life insurance, will the Commission press the UK Government to pay compensation to the Equitable Life customers? What limitation period (time limit for bringing legal claims) will apply to compensation claims?

Answer given by Mr Bolkestein on behalf of the Commission

(6 March 2003)

1. As the Commission indicated in its response to Written Question E-2415/01 by Mr Ford(1), the Commission is aware of the difficulties confronting policyholders of Equitable Life. The Commission has not conducted an investigation into the role of the British Government. The Commission is aware the British Government has announced a full independent enquiry, headed by Lord Penrose, to examine the circumstances leading to these difficulties

2. At the present time, the Commission is not aware of any infringement of the Community insurance directives in connection with Equitable Life.

3. The Commission has no direct role in the supervision of individual insurance undertakings in Member States. In fact, neither the EC Treaty nor Community insurance directives confer specific supervisory powers upon the Commission, nor does the Commission authorise and supervise undertakings wishing to write insurance business.

It falls under the responsibility of each Member State to organise and effect this national supervisory responsibility (see e.g. Article 8 of the so called Third Life Insurance Directive, i.e. Council Directive 92/96/EEC of 10 November 1992 on the co-ordination of laws, regulations and administrative provisions relating to direct life assurance and amending Directives 79/267/EC and 90/619/EEC(2) and Articles 16, 17, 18 and 23 of Council Directive 79/267/EEC of 5 March 1979 on the co-ordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct life assurance(3)).

Where an aggrieved party considers that national supervisory authorities have not properly respected the requirements of the relevant Community Directives, redress may be sought by application to national courts. In fact, national courts are competent to analyse whether a national supervisory authority, when carrying on its supervisory functions, has complied with the supervisory law. They can also take appropriate measures in order to ensure the respect of the law. Furthermore, in such cases it is for the internal legal order of each Member State to designate the competent courts and lay down the detailed procedural rules for legal proceedings intended fully to safeguard the rights which individuals may derive from Community law(4). In these conditions, the time limit for bringing legal claims for compensation is determined by national law.

(1) OJ C 134 E, 6.6.2002.

(2) OJ L 360, 9.12.1992.

(3) OJ L 63, 13.3.1979.

(4) See Judgement of the Court of 19 November 1991, Andrea Francovich and Danila Bonifaci and others v Italian Republic, Joined cases C-6/90 and C-9/90, European Court reports 1991 page I-5357.