COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL On the functioning of Commission Regulation (EU) No 267/2010 on the application of Article 101(3) of the Treaty on the functioning of the European Union to certain categories of agreements, decisions and concerted practices in the insurance sector
Date: 2016-03-17
Institutions: Directorate-General for Competition, European Commission
Subjects: control of restrictive practices, exchange of information, insurance company, inter-company agreement, reinsurance, restriction on competition, restrictive trade practice

EUROPEAN 
COMMISSION 

Brussels, 17.3.2016  
SWD(2016) 63 final 

COMMISSION STAFF WORKING DOCUMENT 

EXECUTIVE SUMMARY 

Accompanying the document 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 
On the functioning of Commission Regulation (EU) No 267/2010 on the application of 
Article 101(3) of the Treaty on the functioning of the European Union  to certain 
categories of agreements, decisions and concerted practices in the insurance sector 

{COM(2016) 153 final} 
{SWD(2016) 62 final} 

EN 

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EXECUTIVE SUMMARY 

According to Article 1(2) of Council Regulation1 1/2003 governing the implementation of the 
EU  competition  rules  as  set  out  in  the  Treaty  on  the  Functioning  of  the  European  Union 
(hereafter TFEU), agreements2 caught by Article 101(1) TFEU which satisfy the conditions of 
Article 101(3) TFEU shall not be prohibited, no prior decision to that effect being required. In 
order  to  comply  with  the  terms  of  this  directly  applicable  exemption  regime,  undertakings 
must carry out a self-assessment of the effects of their agreements. 

There are agreements between undertakings active in the insurance sector that simultaneously 
ensure the proper functioning of this sector and promote consumer interests. Such agreements 
may involve a restriction of competition, but are still regarded as compatible with the Internal 
Market if they promote technical and economic progress and/or improve the production and 
distribution  of  goods  and  services.  At  the  same  time,  as  necessary  conditions,  these 
agreements  must  allow  consumers  a  fair  share  of  the  resulting  benefits,  must  not  eliminate 
competition in the concerned markets, and any restriction of competition caused by them must 
be limited to what is necessary. In the presence of the above-mentioned beneficial effects, the 
agreements are admissible. 

Regulation (EC) No 1534/91 on the application of Article 101(3) TFEU to certain categories 
of  agreements,  decisions  and  concerted  practices  in  the  insurance  sector3  enables  the 
Commission to declare, by way of Regulation, that the provisions of Article 101(1) TFEU are 
inapplicable  to  certain  categories  of  agreements.  The  relevant  Commission's  regulation 
exempts  insurance  undertakings  from  making  an  effects-based  self-assessment  because  the 
overall net benefits of the cooperation can be presupposed. Based on this Regulation, in 2010, 
the Commission adopted the Insurance Block Exemption Regulation4 (hereafter IBER) which 
exempts,  subject  to  certain  conditions:  (1)  agreements  between  (re)insurers  to  exchange 
information  in  the  form  of  joint  compilations,  tables  and  studies;  and  (2)  the  common 
coverage  of  certain  types  of  risks  by  means  of  so-called  co(re)insurance  pools5.  The  IBER 
exemptions  will  lapse  on  31  March  2017,  if  the  Commission  does  not  decide  to  prolong  or 
amend them. The exemption for information exchange allows (re)insurers to cooperate in the 
compilation  and  dissemination  of  statistical  data  in  order  to  predict  and  price  risks  more 

1   Council  Regulation 1/2003/EC  on  the  implementation of the  rules of  competition  laid down  in  Articles  81 

and 82 of the Treaty (OJ L 1/1, 4.1.2003). 

2   Wherever  the  term  "agreements"  is  used  in  this  document,  it  shall  mean  agreements,  decisions  (by 

associations of undertakings) and concerted practices. 

3   Council  Regulation  (EEC)  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  (OJ  L  143, 
7.6.1991, p. 1). 

4   Commission Regulation (EU) 267/2010 on the application of Article 101(3) of the Treaty on the Functioning 
of the European Union to certain categories of agreements, decisions and concerted practices in the insurance 
sector (OJ L 83, 30.3.2010, p.1). 

5   Commission Regulation (EU) 267/2010 (IBER), Article 1, point 5: "[C]o-reinsurance pools’ means groups 
set  up  by  insurance  undertakings  either  directly  or  through  broker  or  authorised  agents,  possibly  with  the 
assistance of one or more reinsurance undertakings, with the exception of ad-hoc co-reinsurance agreements 
on  the  subscription  market,  whereby  a  certain  part  of  a  given  risk  is  covered  by  a  lead  insurer  and  the 
remaining part of this risk is covered by follow insurers who are then invited to cover that remainder in order 
to: (a) reinsure mutually all or part of their liabilities in respect of a specified risk category; (b) incidentally 
accept, in the name and on behalf of all the participants, the reinsurance of the same category of risks." 

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accurately.  The  exemption  for  co(re)insurance  pools  allows  pro-competitive  cooperation 
between (re)insurance undertakings that facilitates market entry and appropriate risk cover.  

The decision regarding the future of the IBER is subject to an Impact Assessment. Since early 
2014 the Commission has been gathering information on the use and functioning of the IBER 
exemptions.  To  date,  this  has  included:  a  study  on  the  different  forms  of  pools  and  ad-hoc 
co(re)insurance  arrangements  available  in  the  EU;  the  consultation  of  the  National 
Competition  Authorities;  a  public  consultation  that  ran  from  August  to  November  2014, 
complemented  with  targeted  questionnaires  and  meetings  with  certain  categories  of 
stakeholders; and other own-initiative research carried out by the Commission. 

As  an  intermediary  step,  the  Commission  is  required  to  submit  a  Report  on  the  functioning 
and future of the IBER no later than six years from its entry into force. Based on the in-depth 
assessment  of  the  evidence  gathered  so  far,  the  Commission  has  arrived  at  the  following 
preliminary views.  

Although  there  are  indications  that  the  insurance  sector  may  have  an  enhanced  need  for 
collaboration  (compared  to  other  economic  sectors)  in  relation  to  the  compilation  and 
distribution of joint calculations, tables and studies, and the co(re)insurance of certain specific 
types of risks, the Commission finds at this stage that the strict conditions for the creation of a 
sector-specific Block Exemption Regulation (hereafter BER) with respect to these categories 
of agreements seem no longer to be met. 

At this stage it seems that the market conditions of the insurance industry no longer appear to 
necessitate the existence of an IBER for the compilation and distribution of joint calculations, 
tables  and  studies.  The  Guidelines  on  the  application  of  Article  101  TFEU  to  horizontal 
cooperation  agreements  (hereafter  Horizontal  Guidelines)  already  offer  guidance  for  the 
purpose  of  self-assessing  the  admissibility  of  this  type  of  cooperation.  Likewise,  the 
Commission  can  provide,  if  necessary,  additional  legal  certainty  and  guidance  to  the 
insurance industry, which is an alternative and far more flexible instrument that can be more 
easily adapted to changing circumstances. 

With respect to co(re)insurance pools, at this stage it seems that the renewal of the IBER is 
not justified because of its limited use and relevance, the potential risk of misapplication and, 
overall, the fact that it is not longer possible to presume with sufficient certainty that the type 
of cooperation covered by the exemption satisfies all the conditions necessary for a finding of 
compatibility  with  the  Internal  Market.  This  is  especially  so  when  considering  that  the 
insurance market currently provides a heterogeneous and less restrictive set of alternatives to 
pools for the purpose of co(re)insuring risks. 

Thus, at this stage a case-by-case self-assessment of the arrangements for the setting-up and 
the functioning of each individual co(re)insurance pool, under the guidance provided by the 
Commission by means of Horizontal Guidelines, which is the standard in other sectors, seems 
to  be  the  best  way  to  ensure  that  co(re)insurance  pools  produce  net  positive  effects  for 
consumers and competition within the meaning of Article 101(3) TFEU. 

In  the  event  that  the  IBER  exemptions  are  not  renewed,  the  Commission  might  decide  to 
adopt  guidance  (replacing  the  current  IBER  Communication)  on  the  principles  of  self-
assessment for those agreements that will no longer benefit from a BER. 

Following its publication, the Commission intends to organise a stakeholder discussion on the 
preliminary conclusions of this Report. 

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The Commission also intends to publish and discuss with stakeholders, where necessary, the 
conclusions of the two studies on a series of issues pertaining to the functioning of the IBER 
that are currently underway. 

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