Notice pursuant to Article 5 of Council Regulation (EEC) No 1534/91 of 31 May 1991 on the application of Article 81(3) of the EC Treaty to certain categories of agreements, decisions and concerted practices in the insurance sector (Text with EEA relevance)
Date: 2002-07-09
Institutions: European Commission
Subjects: insurance, insurance company, insurance law, insurance premium, insured risk, inter-company agreement, inter-company cooperation, restriction on competition

9.7.2002

EN

Official Journal of the European Communities

C 163/7

Notice pursuant to Article 5 of Council Regulation (EEC) No 1534/91 of 31 May 1991 on the
application of Article 81(3) of the EC Treaty to certain categories of agreements, decisions and
concerted practices in the insurance sector

(2002/C 163/06)

(Text with EEA relevance)

In accordance with Article 5 of Council Regulation (EEC) No 1534/91, the Commission invites interested
parties to send their comments concerning the draft Commission Regulation (EC) published below on the
application of Article 81(3) of the EC Treaty to certain categories of agreements in the insurance sector, no
later than 30 September 2002, to:

European Commission
Directorate-General for Competition
Unit D1, Office J 70 2/56
B-1049 Brussels
Fax (32-2) 296 98 07
E-mail: Steve.Ryan@cec.eu.int.

Draft Commission Regulation (EC) No . . ./. . .

of . . .

on the application of Article 81(3) of the Treaty to certain categories of agreements, decisions and
concerted practices in the insurance sector

(Text with EEA relevance)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

— the

establishment of

common standard policy

conditions,

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation (EEC) No 1534/91 of 31
May 1991 on the application of Article 85(3) of the Treaty to
certain categories of agreements, decisions and concerted
practices in the insurance sector (1), and in particular Article
1(1)(a), (b), (c) and (e) thereof,

— the common coverage of certain types of risks,

— the settlement of claims,

— the testing and acceptance of security devices,

Having published a draft of this Regulation (2),

— registers of, and information on, aggravated risks.

Having consulted the Advisory Committee on restrictive
practices and dominant positions,

Whereas:

(1) Regulation (EEC) No 1534/91 empowers the Commission
to apply Article 81(3) of the Treaty by regulation to
certain categories of agreements, decisions and concerted
practices in the insurance sector which have as their
object cooperation with respect to:

— the establishment of common risk premium tariffs
the
based on collectively ascertained statistics or
number of claims,

(2) Pursuant

to that Regulation,

the Commission adopted
Regulation (EEC) No 3932/92 of 21 December 1992 on
the application of Article 85(3) of the Treaty to certain
concerted
categories
practices in the insurance sector (3). Regulation (EEC) No
3932/92, as amended by the Act of Accession of Austria,
Finland and Sweden, expires on 31 March 2003.

agreements,

decisions

and

of

(3) Regulation (EEC) No 3932/92, does not grant

an
exemption to agreements concerning the settlement of
claims and registers of, and information on, aggravated
risks. The Commission considered that it lacked sufficient
experience in handling individual cases to make use of the
power conferred by Regulation (EEC) No 1534/91 in
those fields. This situation has not changed.

(1) OJ L 143, 7.6.1991, p. 1.
(2) OJ C 163, 9.7.2002.

(3) OJ L 398, 31.12.1992, p. 7.

C 163/8

EN

Official Journal of the European Communities

9.7.2002

(4) On 12 May 1999, the Commission adopted a Report (1)
to the Council and the European Parliament on the
operation of Regulation (EEC) No 3932/92. On 15
December 1999,
the Economic and Social Committee
adopted an opinion on the Commission's report (2). On
19 May 2000, the Parliament adopted a Resolution on the
the
Commission's
Commission held a consultation meeting with interested
parties,
including representatives of the insurance sector
and national competition authorities, on the Regulation.

report (3). On

2000,

June

28

of

effective

competition

(5) A new Regulation should meet the two requirements of
and
ensuring
protection
providing adequate legal security for undertakings. The
pursuit of these objectives should take account of the
need to simplify administrative supervision and the legis-
lative framework to as great an extent as possible.
Account must also be
the Commission's
experience in this field since 1992, and the results of
the consultations on the 1999 Report and consultations
during the legislative process leading up to the adoption
of this Regulation.

taken of

(6) Regulation (EEC) No 1534/91 requires the exempting
regulation of the Commission to define the categories of
agreements, decisions and concerted practices to which it
applies, to specify the restrictions or clauses which may,
or may not, appear in the agreements, decisions and
concerted practices, and to specify the clauses which
must be contained in the agreements, decisions and
concerted practices or the other conditions which must
be satisfied.

it is appropriate to move away from the
(7) Nevertheless,
approach of
listing exempted clauses and to place
greater emphasis on defining categories of agreements
which are exempted up to a certain level of market
power and on specifying the restrictions or clauses
which are not to be contained in such agreements. This
is consistent with an economics based approach which
the impact of agreements on the relevant
assesses
market. However,
in the
it should be recognised that
insurance sector there are certain types of collaboration
involving all the undertakings on a relevant insurance
market which can be regarded as normally satisfying the
conditions laid down in Article 81(3).

(8) For the application of Article 81(3) by regulation, it is not
necessary to define those agreements which are capable of
falling within Article 81(1). In the individual assessment
of agreements under Article 81(1), account has to be
taken of several
factors, and in particular the market
structure on the relevant market.

(1) COM(1999) 192 final.
(2) CES 1139/99.
(3) PE A5 — 0104/00.

(9) The benefit of the block exemption should be limited to
those agreements for which it can be assumed with
sufficient certainty that
they satisfy the conditions of
Article 81(3).

in the

to their use

insured makes

frequency tables.

scale of claims, or

(10) Collaboration between insurance undertakings or within
associations of undertakings
compilation of
statistics on the number of claims, the number of indi-
total amounts paid in respect of
vidual risks insured,
claims and the amount of capital
it
possible to improve the knowledge of risks and facilitates
the rating of risks for individual companies. The same
to establish indicative pure
applies
premiums or, in the case of insurance involving capitali-
sation,
Joint studies on the probable
impact of extraneous circumstances that may influence
the yield of
the frequency or
different types of investments, should also be included.
It is, however, necessary to ensure that the restrictions
are only exempted to the extent
to which they are
necessary to attain these objectives. It is therefore appro-
priate to stipulate that concerted practices on commercial
the premiums actually
premiums — that
to say,
charged to policyholders, comprising an element
to
cover administrative, commercial and other costs, plus a
loading for contingencies or profit margins — are not
exempted, and that even indicative pure premiums can
Insofar as the joint
serve only for reference purposes.
calculation of
and joint
carrying-out of studies do not extend to the commercial
premiums charged to policyholders and are of indicative
nature,
it can be expected that consumers will benefit
from larger choice of suppliers given that market entry
and the presence of a wider number of competitors on
the market are facilitated.

indicative pure premiums

is

(11) Moreover, the broader the categories into which statistics
gathered for the purposes of calculating pure premiums
are grouped, the less leeway insurance undertakings have
to calculate premiums on a narrower basis. It is therefore
appropriate to limit the benefit of the block exemption to
exchanges of statistics and joint calculation of indicative
pure premiums to situations where the statistics used are
grouped in the narrowest possible categories which are
compatible with the inclusion in each category of a mean-
ingful statistical sample.

to

and

related

studies

indicative

(12) Furthermore, since access to such calculations of pure
risk
premiums,
premiums,
is necessary both for insurance undertakings
active on the geographic or product market in question
and also for those considering entering that market, such
insurance undertakings must be granted access to such
calculations and studies on reasonable and non-discrimi-
natory terms, as compared with insurance undertakings
already present on that market. Such terms might for
example include a commitment from an insurance under-
taking not yet present on the market to provide statistical
information on claims, should it ever enter the market.
They might also include membership of the association of

9.7.2002

EN

Official Journal of the European Communities

C 163/9

insurers responsible for producing the calculations, as
long as access to such membership is itself available on
reasonable and non-discriminatory terms to insurance
undertakings not yet active on the market in question.
However, any fee charged for access to such calculations
or related studies to insurance undertakings which have
not contributed to them, would not be considered
reasonable for this purpose if
it were so high as to
constitute a barrier to entry on the market.

(13) The reliability of jointly calculated pure premiums, and
joint studies becomes greater as the amount of statistics
on which they are based is increased. Insurers with high
market shares may generate sufficient statistics internally
to be able to calculate reliable pure premiums, but those
with small market shares will not be able to do so, much
less new entrants. The inclusion in such joint calculations
and joint studies of information from all insurers on a
including large ones, promotes competition by
market,
insurers, and facilitates market entry.
helping smaller
Given this specificity of the insurance sector,
it is not
appropriate to subject any exemption for such joint calcu-
lations and joint studies to market share thresholds.

(14) Standard policy conditions or standard individual clauses
for direct insurance and standard models illustrating the
profits of a life assurance policy are necessary for the
calculation of indicative pure and risk premiums since
these must be calculated with reference to certain policy
conditions. However, standard policy conditions must not
lead either to the standardisation of products or to the
creation of a significant imbalance between the rights and
the
obligations arising from the contract. Accordingly,
exemption should only
to standard policy
conditions developed and agreed in conjunction with
the joint calculation of pure premiums and joint studies
related to risk premiums, and only in so far they are both
necessary and exclusively used for such calculations or
studies. Furthermore,
it should apply on condition: that
they are not binding, and serve only as models.

apply

(15) Standard policy

conditions may not

contain any
systematic exclusion of specific types of risk without
including that
providing for the express possibility of
cover by agreement and may not provide for
the
contractual relationship with the policyholder to be main-
tained for an excessive period or go beyond the initial
object of the policy. This is without prejudice to obli-
law to
gations arising from Community or national
include certain risks in certain policies.

(17) The inclusion in an insurance policy of risks to which a
significant number of policyholders is not simultaneously
exposed may hinder innovation, given that the bundling
of unrelated risks can be a disincentive for insurers to
offer separate and specific insurance cover for them. A
clause which imposes such comprehensive cover should
therefore not be covered by the block exemption. Where
there is a legal requirement on insurers to include in
policies cover for risks to which a significant number of
policyholders are not simultaneously exposed, then the
inclusion in an indicative model contract of a standard
clause reflecting such a legal
requirement does not
constitute a restriction of competition and falls outside
the scope of Article 81(1).

(often called ‘pools’) designed to cover

(18) The establishment of co-insurance or co-reinsurance
groups
an
unspecified number of risks does not restrict competition
in the meaning of Article 81(1) of the Treaty if, in the
absence of the group in question, none of the members of
the group would be able to supply the category of
insurance concerned (even if other insurers or groups of
insurers do supply that category of insurance). Where the
total subscription capacity of the group is greater than
double the subscription capacity necessary to offer the
category of insurance in question, with a level of cover
sufficient to cover the risks concerned, then the group
could be replaced by at
two competing groups,
least
and therefore it may, depending on the level of market
power, restrict competition within the meaning of Article
81(1).

the subscription capacity of all

(19) The establishment of such co-insurance or co-reinsurance
groups also does not restrict competition in the meaning
in the absence of the
of Article 81(1) of the Treaty if,
group in question, only one of the members of the group
would be able to supply the category of insurance in
question, unless
the
other members of the group taken together would be
sufficient to offer the category of insurance in question,
with a level of cover
the risks
concerned. In that case, the group could be replaced by
one group and one individual
insurer, competing with
each other, and therefore the group may, depending on
the level of market power, restrict competition within the
meaning of Article 81(1).

to cover

sufficient

(16) In addition, it is necessary to stipulate that the common
standard policy conditions must be generally available to
any interested person, and in particular to the policy-
holder, so as to ensure that there is real transparency
and therefore benefit for consumers.

(20) However, the establishment of any such co-insurance or
co-reinsurance group may, depending on the level of
market power, restrict competition within the meaning
of Article 81(1) of the Treaty if,
in the absence of the
group in question, more than one of the members of the
group would be able alone to supply the category of
insurance in question.

C 163/10

EN

Official Journal of the European Communities

9.7.2002

it

(21) For new risks, where no historical information on claims
exists,
is not possible to know in advance what
subscription capacity is necessary to cover the risk, nor
whether
two or more co-insurance or co-reinsurance
groups could coexist for the purposes of providing this
type of
the
insurance. A pooling arrangement
insurance of such new risks can therefore be exempted
for a limited period of time. Three years should constitute
an adequate period for
the constitution of sufficient
information on claims to assess the necessity
historical
or otherwise of one
single pool. This Regulation
therefore grants an exemption to any such group which
is newly created in order to cover a new risk, for the first
three years of its existence.

for

(22) For risks which are not new, it is recognised that such
co-insurance and co-reinsurance groups which involve a
in certain limited
restriction of competition can also,
involve benefits such as to justify an
circumstances,
exemption under Article 81(3), even if
they could be
replaced by two or more competing insurance entities.
They may for example, allow their members to gain the
necessary experience of the sector of insurance involved,
they may allow cost savings, or reduction of premiums
through joint
terms.
However, any exemption for such groups is not justified
if the group in question benefits from a significant level of
market power, since in those circumstances the restriction
of competition deriving from the existence of the pool
would normally outweigh any possible advantages.

reinsurance on advantageous

(23) This Regulation therefore grants an exemption to any
such co-insurance or co-reinsurance group which has
existed for more than three years, or which is not
created in order to cover a new risk, on condition that
the combined market shares of its members do not exceed
the following thresholds: 25 % in the case of co-rein-
surance groups, and 20 % in the case of co-insurance
groups. The threshold for co-insurance groups is lower
because the mechanism of co-insurance requires uniform
policy conditions and commercial premiums, with the
result that residual competition between members of a
co-insurance group is particularly reduced.

(24) These exemptions however only apply if the group in
question meets the further conditions laid out in Article
8 of the present Regulation, which are intended to keep
to a minimum the restrictions of competition between the
members of the group.

(25) Cooperation in the evaluation of security devices and of
the undertakings
installing and maintaining them is
beneficial in so far as it removes the need for repeated
individual evaluation. Accordingly, the Regulation should
define the conditions under which the formulation of
technical
for approving
such security devices and the undertakings installing or
maintaining them are exempted. The purpose of such
conditions is to ensure that all manufacturers and instal-

specifications and procedures

lation and maintenance undertakings may apply for
evaluation, and that
the evaluation and approval are
guided by objective and well-defined criteria, which may
only relate to the performance of the devices and not to
certain technologies to be used; as to installers or main-
tenance undertakings, only performance related criteria
may be used.

(26) Ideally, standards or technical specifications for all matters
relating to security devices, and their assessment, certifi-
installation, and maintenance, would exist at
cation,
European
and
thus
such
coherence within the
European-level standards or technical specifications exist,
agreements at national level are unnecessary and cannot
be covered by the block exemption.

ensuring
harmonisation
single market. Where

level,

(27) Where no such European-level standards or technical
specifications exist, agreements between insurers laying
specifications or approval procedures
down technical
that are used in one or several Member States should be
exempted; however, experience has shown that differing
national agreements among insurers on security devices or
undertakings installing or maintaining security devices can
make it difficult for policyholders to cover a certain risk if
the security device or installer or maintenance under-
taking used complies with the specifications or approval
procedures set up by insurers of another Member State,
but not with the specifications or approval procedures
agreed by the insurers of the Member State where the
risk is located. It is therefore appropriate to extend the
benefit of
the block exemption to any such national
agreements only if they explicitly provide for the recog-
nition of any other such national agreements and of the
approval of a security device or an installer or main-
tenance undertaking in any other Member State.

(28) Lastly, any agreements on security devices must not result
in an exhaustive list of approved devices; each under-
taking must remain free to accept devices and installation
and maintenance undertakings not approved jointly.

(29) If

as

Justice,

interpreted by the

the Commission and the case-law of

the block exemption. This may occur

individual agreements exempted by this Regulation
nevertheless have effects which are incompatible with
administrative
Article 81(3),
practice of
the
the Commission may withdraw the
Court of
benefit of
in
particular where studies on the impact of future devel-
opments are based on unjustifiable hypotheses; or where
recommended standard policy conditions contain clauses
which create,
the policyholder, a
significant imbalance between the rights and obligations
arising from the contract; or where groups are used or
managed in such a way as to give one or more partici-
pating undertakings the means of acquiring or reinforcing
a position of significant market power on the relevant
market, or if these groups result in market sharing.

to the detriment of

9.7.2002

EN

Official Journal of the European Communities

C 163/11

(30) In order to facilitate the conclusion of agreements, some
of which can involve significant investment decisions, the
period of validity of this Regulation should be fixed at 10
years.

for

the common coverage of a specific
undertakings
category of risks in the form of co-insurance or co-rein-
surance; and

(31) This Regulation is without prejudice to the application of

Article 82 of the Treaty.

(f)

the establishment, recognition and distribution of:

— technical specifications for security devices,

(32) In accordance with the principle of

the primacy of
Community law, no measure taken pursuant to national
the uniform
laws on competition should prejudice
the
application throughout
Community competition rules or the full effect of any
measures adopted in implementation of
those rules,
including this Regulation,

the common market of

— procedures for assessing and approving the compliance

of security devices with such specifications,

— rules or codes of practice for the installation and main-

tenance of security devices, and

HAS ADOPTED THIS REGULATION:

— rules for the evaluation and approval of undertakings

which install or maintain security devices.

CHAPTER I

EXEMPTION AND DEFINITIONS

Article 1

Exemption

this Regulation,

Pursuant to Article 81(3) of the Treaty and subject to the
provisions of
is hereby declared that
Article 81(1) of
the Treaty shall not apply to agreements
in the
entered into between two or more undertakings
insurance sector (hereinafter referred to as ‘the parties’ and
which relate to the conditions under which the parties seek
or achieve cooperation with respect to:

it

(a) the joint calculation of indicative pure premiums or the
establishment and distribution of mortality tables, and
tables
illness, accident and
in connection with insurance involving an
invalidity,
element of capitalisation;

showing the frequency of

(b) the joint carrying-out of studies for the purposes of deter-
mining indicative risk premiums, and the distribution of
their results;

conditions

(c) the joint establishment and distribution of non-binding
policy
are
direct
developed and agreed in conjunction with the calculations
and/or studies referred to in Article 1(a) and (b) above and
only in so far they are both necessary and exclusively used
for such calculations or studies;

insurance which

for

Article 2

Definitions

For the purposes of the present Regulation, the following defi-
nitions shall apply:

1.

‘Agreement’ means an agreement, a decision of an
association of undertakings or a concerted practice.

2.

‘Participating undertakings’ means undertakings party to
the agreement and their
respective connected under-
takings.

3.

‘Connected undertakings’ means:

(a) undertakings in which a party to the agreement,

directly or indirectly:

(i) has the power to exercise more than half

the

voting rights; or

(ii) has the power to appoint more than half

the
members of
the supervisory board, board of
management or bodies legally representing the
undertaking; or

(iii) has the right to manage the undertaking's affairs;

(d) the joint establishment and distribution of non-binding
models illustrating the profits to be realised from an
insurance policy involving an element of capitalisation;

(b) undertakings which directly or indirectly have, over a
party to the agreement, the rights or powers listed in
(a);

(e) the setting-up and operation of groups of insurance under-
insurance undertakings and reinsurance

takings or of

(c) undertakings in which an undertaking referred to in (b)
has, directly or indirectly, the rights or powers listed in
(a);

C 163/12

EN

Official Journal of the European Communities

9.7.2002

(d) undertakings

in which a party to the agreement
the undertakings
(b) or (c), or in which two or
jointly have the

together with one or more of
referred to in (a),
more of
rights or powers listed in (a);

the latter undertakings,

9.

‘New risk’ means a risk for which no historical information
on claims exists which could be used to calculate pure
premiums.

(e) undertakings in which the rights or the powers listed

in (a) are jointly held by:

10.

devices’

‘Security
and
equipment designed for loss prevention and reduction,
and to systems formed from such elements.

both to components

refers

(i) parties

respective
agreement or
connected undertakings referred to in (a) to (d); or

to the

their

CHAPTER II

JOINT CALCULATION OF INDICATIVE PURE PREMIUMS AND
CARRYING OUT OF STUDIES

(ii) one or more of the parties to the agreement or one
or more of their connected undertakings referred
to in (a) to (d) and one or more third parties.

Article 3

Conditions for exemption

4.

5.

‘Risk premium’ means the estimated cost of covering a
specified risk in the future, to the exclusion of any admin-
fiscal or parafiscal
istrative or commercial costs or
either
into account
contributions,
revenues from investments or anticipated profits.

and not

taking

‘Pure premium’ means the average cost of covering a
specified risk in the past, to the exclusion of any adminis-
trative or
fiscal or parafiscal
contributions, and not taking into account revenues from
investments nor anticipated profits.

commercial

costs or

The exemptions provided for in Article 1(a) and (b) shall apply
on condition that:

(a) all indicative pure premiums and tables are based on the
assembly of data, spread over a number of risk-years
chosen as an observation period, which relate to identical
or comparable risks in sufficient number to constitute a
base which can be handled statistically and which will
yield figures on (inter alia):

— the number of claims during the said period,

6.

‘Standard policy conditions’ refers to any clauses contained
in model or reference insurance policies prepared jointly
by insurers or by bodies or associations of insurers.

— the number of individual risks insured in each risk-year

of the chosen observation period,

7.

‘Co-insurance groups’ means groups set up by insurance
undertakings which:

— the total amounts paid or payable in respect of claims

arisen during the said period,

— agree to underwrite in the name and for the account of
all the participants the insurance of a specified risk
category, or

— the total amount of capital insured for each risk-year

during the chosen observation period;

— entrust

the underwriting and management of

the
insurance of a specified risk category in their name
and on their behalf to one of the insurance under-
takings, to a common broker or to a common body
set up for this purpose.

8.

‘Co-reinsurance groups’ means groups set up by insurance
undertakings, possibly with the assistance of one or more
reinsurance undertakings:

— in order to reinsure mutually all or part of
liabilities in respect of a specified risk category,

their

(b) the calculations, tables or study results, when compiled and
distributed, include a statement that they are purely illus-
trative;

(c)

the calculations tables or study results do not include in
any way elements for contingencies, income deriving from
reserves, administrative or commercial costs;

(d) the calculations, tables or study results do not identify the

insurance undertakings concerned;

— incidentally, to accept in the name and on behalf of all
the participants the reinsurance of the same category
of risks.

(e)

in the calculations or tables the statistics are grouped in the
narrowest possible categories which are compatible with
the inclusion in each category of a meaningful statistical
sample;

9.7.2002

EN

Official Journal of the European Communities

C 163/13

(f)

the calculations, tables or study results are made available
to any
on reasonable and non-discriminatory terms,
insurance undertaking which requests a copy of
them,
including insurance undertakings which are not active on
the geographical or product market to which those calcu-
lations, tables or study results refer;

(g) that

the studies concern only the probable impact of
to the interested under-
general circumstances external
takings on the frequency or scale of claims, or the profit-
ability of different types of investment.

Article 4

Agreements not covered by the exemption

The exemption provided for in Article 1 shall not apply where
into an undertaking or
enter
participating undertakings
commitment among themselves, or oblige other undertakings,
not to use calculations or tables that differ from those estab-
lished pursuant to Article 1(a), or not to depart from the results
of the studies referred to in Article 1(b).

CHAPTER III

NON-BINDING STANDARD POLICY CONDITIONS FOR
DIRECT INSURANCE AND MODELS

Article 5

Conditions for exemption

(b) indicate the amount of the cover or the part which the

policyholder must pay himself (‘the excess’);

(c) allow the insurer to maintain the policy in the event that
he cancels part of
the premium
the cover,
without the risk or the scope of the cover being changed
(without prejudice to indexation clauses), or otherwise
alters the policy conditions without the express consent
of the policyholder;

increases

(d) allow the insurer to modify the term of the policy without

the express consent of the policyholder;

(e)

impose on the policyholder in the non-life assurance sector
a contract period of more than three years;

(f)

impose a renewal period of more than one year where the
policy is automatically renewed unless notice is given upon
the expiry of a given period;

(g) require the policyholder to agree to the reinstatement of a
policy which has been suspended on account of the disap-
pearance of the insured risk, if he is once again exposed to
a risk of the same nature;

The exemption provided for in Article 1(c) shall apply on

1.
condition that the standard policy conditions:

(h) require the policyholder to obtain cover from the same

insurer for different risks;

(a) are established and distributed with an explicit statement

that they are non-binding;

(i)

in the event of disposal of the
require the policyholder,
object of insurance, to make the acquirer take over the
insurance policy;

(b) expressly mention that participating undertakings are free
to offer different policy conditions to their customers; and

(c) are accessible to any interested person and provided simply

upon request.

The exemption provided for in Article 1(d) shall apply on
the non-binding models are established and

2.
condition that
distributed only by way of guidance.

Article 6

Agreements not covered by the exemption

1.
The exemption provided for in Article 1(c) shall not
apply where the standard policy conditions contain clauses
which:

(a)

impose comprehensive cover including risks to which a
significant number of policyholders are not simultaneously
exposed, without prejudice to legally imposed obligations;

(j) exclude or limit the cover of a risk if the policyholder uses
security devices, or installing or maintenance undertakings,
specifications
which are compatible with the relevant
agreed by an association or associations of
insurers in
one or several other Member States or at the European
level.

The exemption provided for in Article 1(c) shall not
2.
benefit undertakings or associations of undertakings which
agree, or agree to oblige other undertakings, not to apply
conditions other than standard policy conditions established
pursuant to an agreement between the participating under-
takings.

establishment of

specific
to the
3. Without prejudice
social or occupational
for particular
insurance conditions
categories of the population, the exemption provided for in
Article 1(c) shall not apply to agreements decisions and
concerted practices which exclude the coverage of certain
risk categories because of the characteristics associated with
the policyholder.

C 163/14

EN

Official Journal of the European Communities

9.7.2002

The exemption provided for in Article 1(d) shall not
4.
apply where, without prejudice to legally imposed obligations,
the non-binding models include only specified interest rates or
contain figures indicating administrative costs.

5.
The exemption provided for in Article 1(d) shall not
benefit undertakings or associations of undertakings which
concert or undertake among themselves, or oblige other under-
takings, not to apply models illustrating the benefits of an
insurance policy other than those established pursuant to an
agreement between the participating undertakings.

risks located in any particular geographical part of the
European Union;

(d) the agreement does not limit output or sales;

(e)

the agreement does not allocate markets or customers;

(f)

the members of a co-reinsurance group do not agree on
any other premium than the risk premium.

CHAPTER IV

COMMON COVERAGE OF CERTAIN TYPES OF RISKS

Article 7

Market share threshold and duration of exemption

1.
As concerns co-insurance or co-reinsurance groups which
are newly created in order to cover a new risk, the exemption
provided for in Article 1(e) shall apply for a period of three
years from the date of the first establishment of the group,
regardless of the market share of the group.

2.
As concerns co-insurance or co-reinsurance groups which
do not fall within the scope of the first paragraph (for the
reason that they have been in existence for over three years
or have not been created in order to cover a new risk), the
exemption provided for in Article 1(e) shall apply on condition
that the insurance products underwritten within the grouping
arrangement by the participating undertakings or on their
behalf do not, in any of the markets concerned, represent:

(a)

in the case of co-insurance groups, more than 20 % of the
relevant market;

(b) in the case of co-reinsurance groups, more than 25 % of

the relevant market.

Article 8

Conditions for exemption

The exemption provided for in Article 1(e) shall apply on
condition that:

(a) each participating undertaking has the right to withdraw
from the group, subject to a period of notice of not more
than one year, without incurring any sanctions;

(b) the rules of the group do not oblige any member of the
group to insure or reinsure through the group any risk of
the type covered by the group;

(c) the rules of the group do not restrict the activity of the
group or its members to the insurance or reinsurance of

CHAPTER V

SECURITY DEVICES

Article 9

Conditions for exemption

The exemption provided for in Article 1(f) shall apply on
condition that:

(a)

(b)

(c)

the technical specifications and compliance assessment
procedures
justified and in
proportion to the performance to be attained by the
security device concerned;

are precise,

technically

the rules for the evaluation of installation undertakings
and maintenance undertakings are objective,
relate to
applied in a
competence
their
non-discriminatory manner;

and are

technical

an

and

rules

specifications

are
accompanying

and
such
that
distributed with
insurance undertakings are free in individual cases to
accept other security devices or approve other installation
and maintenance undertakings which do not comply with
these technical specifications or rules;

established
statement

(d)

such specifications and rules are provided simply upon
request to any interested person;

(e)

such specifications include a classification based on the
level of performance obtained;

(f)

a request for an assessment may be submitted at any time
by any applicant;

(g)

(h)

impose on the
the evaluation of conformity does not
applicant any expenses that are disproportionate to the
costs of the approval procedure;

the devices and installation undertakings and maintenance
undertakings that meet the assessment criteria are certified
to this effect in a non-discriminatory manner within a
period of six months of the date of application, except
where
reasonable
technical
additional period;

considerations

justify

a

9.7.2002

EN

Official Journal of the European Communities

C 163/15

(i)

the fact of compliance or approval is certified in writing;

(j)

the grounds for a refusal
to issue the certificate of
compliance are given in writing by attaching a duplicate
copy of the records of the tests and controls that have
been carried out;

(k)

the grounds for a refusal to take into account a request for
assessment are provided in writing;

(l)

specifications

applied by bodies
the
observing the appropriate provisions of norms in the
series EN 45000;

and rules

are

(m) any technical specifications, rules, procedures or codes of
practice which are
an association or
adopted by
associations of insurance or reinsurance undertakings in
one or
several Member States explicitly recognise as
rules
equally valid any such technical
procedures or codes of practice adopted by national
associations of insurance or reinsurance undertakings in
other Member States;

specifications,

(n) any technical specifications, rules, procedures or codes of
practice which are
an association or
adopted by
associations of insurance or reinsurance undertakings in
one or several Member States explicitly and automatically
recognise as equally valid any approval of a security device
or installing and maintenance undertaking issued by an
association of insurance or reinsurance undertakings in
another Member State.

Article 10

Agreements not covered by the exemption

The exemption provided for in Article 1(f) shall not apply to
technical specifications, rules, procedures or codes of practice
adopted by an association or associations of insurance or rein-
surance undertakings in one or several Member States if there
exist equivalent technical specifications, rules, procedures or
codes of practice at European level.

CHAPTER VI

MISCELLANEOUS PROVISIONS

Article 11

Application of the market share threshold

For the purposes of applying the market share threshold

1.
provided for in Article 7(2) the following rules shall apply:

(a) the market share shall be calculated on the basis of the
gross premium income;
if gross premium income data
are not available, estimates based on other reliable market

information, including insurance cover provided or insured
risk value, may be used to establish the market share of the
undertaking concerned;

(b) the market share shall be calculated on the basis of data

relating to the preceding calendar year;

(c)

the market share held by the undertakings referred to in
Article 2(3)(e) of shall be apportioned equally to each
undertaking having the rights or the powers listed in
Article 2(3)(a).

2.
If the market share referred to in Article 7(2)(a) is initially
not more than 20 % but subsequently rises above this level
without exceeding 25 %, the exemption provided for in Article
1 shall continue to apply for a period of two consecutive
calendar years
in which the 20 %
threshold was first exceeded.

following the year

3.
If the market share referred to in Article 7(2)(a) is initially
not more than 20 % but subsequently rises above 25 %, the
exemption provided for in Article 1 shall continue to apply for
one calendar year following the year in which the level of 25 %
was first exceeded.

The benefit of paragraphs 2 and 3 may not be combined

4.
so as to exceed a period of two calendar years.

5.
If the market share referred to in Article 7(2)(b) is initially
not more than 25 % but subsequently rises above this level
in
without exceeding 30 %,
Article 1 shall continue to apply for a period of
two
consecutive calendar years following the year in which the
25 % threshold was first exceeded.

the exemption provided for

6.
If the market share referred to in Article 7(2)(b) is initially
not more than 25 % but subsequently rises above 30 %, the
exemption provided for in Article 1 shall continue to apply for
one calendar year following the year in which the level of 30 %
was first exceeded.

The benefit of paragraphs 5 and 6 may not be combined

7.
so as to exceed a period of two calendar years.

Article 12

Withdrawal

The Commission may withdraw the benefit of this Regulation,
pursuant to Article 7 of Regulation (EEC) No 1534/91, where
either on its own initiative or at the request of a Member State
or of a natural or legal person claiming a legitimate interest, it
finds in a particular case that an agreement
to which the
exemption provided for in Article 1 applies nevertheless has
effects which are incompatible with the conditions laid down
in Article 81(3) of the Treaty, and in particular where:

C 163/16

EN

Official Journal of the European Communities

9.7.2002

(a) studies to which the exemption in Article 1(b) applies are

based on unjustifiable hypotheses,

Article 13

Transitional period

(b) standard policy conditions to which the exemption in
Article 1(c) applies contain clauses which create, to the
detriment of
imbalance
between the rights and obligations arising from the
contract;

the policyholder, a significant

The prohibition laid down in Article 81(1) of the Treaty shall
not apply during the period from 1 April 2003 to 30
September 2003 in respect of agreements already in force on
31 March 2003 which do not satisfy the conditions for
exemption provided for in this Regulation but which satisfy
the conditions for exemption provided for in Regulation (EEC)
No 3932/92.

(c)

in relation to the common coverage of certain types of
risks to which the exemption in Article 1(e) applies, one
of the two following situations occurs:

Article 14

Period of validity

— one or more participating undertakings exercises a
determining influence on the commercial policy of
more than one group on the same market,

This Regulation shall enter into force on 1 April 2003. It shall
expire on 31 March 2013.

This Regulation shall be binding in its entirety and directly
applicable in all Member States.

— the setting-up or operation of a group results, through
the conditions governing admission, the definition of
the risks to be covered, the agreements on retrocession
or by any other means, in the sharing of the markets
for the insurance products concerned or for neigh-
bouring products.

Done at Brussels, . . .

For the Commission

. . .

Member of the Commission