WRITTEN QUESTION E-2386/01 by Christopher Huhne (ELDR) to the Commission. Annuities.
Date: 2001-08-20
Institutions: European Parliament, Provisional data
Subjects: EU Member State, EU law - national law, freedom to provide services, insurance company, insurance contract, life assurance, right of establishment

16.5.2002

EN

Official Journal of the European Communities

C 115 E/69

Answer given by Mrs Diamantopoulou on behalf of the Commission

(28 September 2001)

The Honourable Member has drawn the Commission’s attention to the problem of admission to private
medical insurance schemes as experienced by frontier workers working in the Netherlands but living in
another Member State. It seems that Dutch legislation in this area contains a residence requirement which
could run counter to Community law and in particular to Regulation (EEC) No 1612/68 of the Council of
15 October 1968 on freedom of movement for workers within the Community (1). In order to be able to
examine all legal aspects of the question raised, the Commission has contacted the Dutch authorities to
obtain further details on the Dutch legislation in question and on the position of the Netherlands
Government on this issue.

The Commission will inform the Honourable Member of the outcome of its inquiries.

(1) OJ L 257, 19.10.1968, p. 2.

(2002/C 115 E/073)

WRITTEN QUESTION E-2386/01

by Christopher Huhne (ELDR) to the Commission

(20 August 2001)

Subject: Annuities

Does the Commission believe that the EU market in annuities (regular payments for the remainder of a
life) works reasonably well? Is it aware of certain distortions of competition which may arise because of
regulatory requirements, and is it satisfied that those regulatory requirements do not involve discrimination
against other Member States?

Answer given by Mr Bolkestein on behalf of the Commission

(17 October 2001)

Annuities is a specific product sold by life assurance undertakings and built according to life assurance
techniques, which require the insurer to set up enough technical provisions in order to enable the
insurance undertaking to meet
the contractual commitments arising from the insurance policy.
Community insurance legislation coordinates Member States provisions regarding the conditions for
taking up and pursuing life insurance activities in the Community. In addition to an administrative
authorisation of a life insurance undertaking, the coordination of national rules covers the methods of
calculation of technical provisions, which must be sufficient, and the representation of such technical
provisions by appropriate, spread and matching assets as well as a minimum solvency margin. Community
legislation allows insurance undertakings to engage in life insurance activities in all Member States, if they
consider it appropriate, and therefore to market annuity policies in different Member States, by means of
right of establishment and the freedom to provide services.

The contents and the terms of annuities policies often depend on particular factors existing in Member
States in different fields such as social or tax legislation rather than insurance law itself. These factors, in
particular tax law, explain the importance of annuities products in some Member States compared to
others. Member States tend to afford a favourable tax treatment, when those particular conditions laid
down by tax law are met,
lump sum insurance contracts. In the current stage of
Community legislation Member States are competent to lay down the conditions regarding taxation of
different life insurance products. However when using their powers, Member States cannot provide rules
which are contrary to Community law, in particular to the rules of free movement of persons and services.

instead of capital

C 115 E/70

Official Journal of the European Communities

EN

16.5.2002

The Commission has recently published a Communication on the elimination of tax obstacles to the cross-
border provision of occupational pensions (1). The Commission considers that discriminatory tax treatment
of pension and life assurance policies concluded with providers established in other Member States is
contrary to the fundamental freedoms of the EC Treaty. The Commission will monitor the relevant
national rules and take the necessary steps to ensure effective compliance with the fundamental freedoms
of the EC Treaty.

(1) COM(2001) 214 final.

(2002/C 115 E/074)

WRITTEN QUESTION E-2389/01

by Christopher Huhne (ELDR) to the Commission

(20 August 2001)

Subject: Health care

Will the Commission give its view of EU law on the circumstances under which a Member State must pay
for the health care of one of its citizens in another Member State?

Answer given by Mrs Diamantopoulou on behalf of the Commission

(19 October 2001)

The Commission wishes to draw the Honourable Member’s attention to the fact that Community rules
exist concerning the coordination of social security systems; these rules are contained in Regulations (EEC)
No 1408/71 (1) and No 574/72 (2), which feature a detailed chapter on sickness benefits whose purpose is
to offer real protection to persons moving within the Union. These regulations are designed neither to alter
the structure or content of national social security legislation nor to harmonise these legislations. Their
basic function is to coordinate these laws at Community level.

Pursuant to these Community rules, there are three circumstances in which health benefits may be funded
by the sickness insurance institution with which a person is registered although the benefits are provided
in another Member State:

@ when the person resides in a Member State other than the one in which he is insured (such as a

frontier worker);

@ when unforeseen emergency care is provided during a temporary stay in another Member State (for

example, during a tourist visit);

@ when a person intentionally travels to another Member State with a view to medical treatment and has
obtained an authorisation to do so from the sickness insurance institution with which he is registered.

In these three circumstances the health benefits are provided in accordance with the legislation of the
Member States providing them, but the costs are charged to the sickness institution with which the insured
person is registered.

The authorisation system provided for by Regulation No 1408/71 when a person travels abroad with a
view to medical treatment leaves the Member States wide discretion as regards granting or refusing
authorisation and mandates authorisation only in strictly defined circumstances. The competent
institutions have been given responsibility for authorisation because it is important that the Member
State institutions be able to fund treatment provided outside their territory so that they can reimburse the
institutions of the Member States in which the treatment has been provided.

The Honourable Member should note that the Court of Justice, while acknowledging the validity of the
authorisation system enshrined by Regulation No 1408/71, has reinforced the rights of insured persons as
regards the reimbursement of medical services provided in another Member State, on the basis of the
provisions of the EC Treaty enshrining the freedom to provide services and the free movement of goods.