CELEX: 51989PC0474
Language: en
Date: 1989-11-06
Title: AMENDED PROPOSAL FOR A COUNCIL DIRECTIVE ON THE ANNUAL ACCOUNTS AND CONSOLIDATED ACCOUNTS OF INSURANCE UNDERTAKINGS

8. 2. 90                              Official Journal of the European Communities                           No C 30/51
                                                              ANNEX
                      LESS-FAVOURED AREAS PURSUANT TO ARTICLE 3 (4) OF DIRECTIVE 75/268/EEC
                                              AREA 31 — Prefecture of KORINTHIA
                                        No                         Commune
                                         14          Koutalas
              Amended proposal for a Council Directive on the annual accounts and consolidated accounts of
                                                    insurance undertakings 0)
                                                  COM(89) 474 final — SYN 78
                        [Submitted by the Commission pursuant to Article 149 (3) of the EEC Treaty
                                                       on 30 October 1989]
                                                           (90/C 30/04)
              (i) OJ No C 131, 18. 5. 1987, p. 1.
 THE COUNCIL OF THE EUROPEAN COMMUNITIES,                           THE COUNCIL OF THE EUROPEAN COMMUNITIES,
 Having regard to the Treaty establishing the European              Having regard to the Treaty establishing the European
 Economic Community, and in particular Article 54                   Economic Community, and in particular Article 54
 thereof,                                                           thereof,
 Having regard to the proposal from the Commission,                 Having regard to the proposal from the Commission,
 Having regard to the opinion of the European Parliament,           In cooperation with the European Parliament,
 Having regard to the opinion of the Economic and Social            Having regard to the opinion of the Economic and Social
 Committee,                                                         Committee,
 Whereas Article 54 (3) (g) of the Treaty requires the              Unchanged
coordination to the necessary extent of the safeguards
 which, for the protection of the interests of members and
others, are required by Member States for companies or
firms within the meaning of the second paragraph of
Article 58 of the Treaty, with a view to making such
safeguards equivalent throughout the Community;
Whereas the Fourth Council Directive 78/660/EEC of                 Unchanged
25 July 1978 based on Article 54 (3) (g) of the Treaty on the
annual accounts of certain types of companies ('), as last
amended by the Act of Accession of Spain and Portugal,
need not be applied to insurance companies, hereinafter
referred to as 'insurance undertakings', pending sub-
sequent coordination: whereas, in view of the importance
of insurance undertakings in the Community, such
coordination cannot be delayed any longer following
implementation of Directive 78/660/EEC;
(!) OJ No L 222, 14. 8. 1978, p. 11.
 ---pagebreak---  No C 30/52                              Official Journal of the European Communities                                                     8. 2. 90
 Whereas the Seventh Council Directive 83/349/EEC of                Unchanged
 13 June 1983 based on Article 54 (3) (g) of the Treaty on
 consolidated accounts (*) provides for derogations for
 insurance undertakings only until expiry of the deadline
 imposed for the application of this Directive; whereas this
 Directive must therefore also contain provisions specific to
 insurance undertakings in respect of consolidated ac-
 counts ;
 Whereas such coordination is also urgently required owing          Unchanged
 to the Community-wide operations of insurance undertak-
 ings; whereas, for creditors, debtors, members, policy-
 holders and their advisers and for the general public,
 improved comparability of the annual accounts and
 consolidated accounts of these undertakings is therefore of
 crucial importance;
Whereas, in the Member States, insurance undertakings of           W h e r e a s , in the M e m b e r States, insurance undertakings of
different legal forms are in competition with each other;          different legal forms are in competition with each o t h e r ;
 whereas undertakings engaged in the business of direct             whereas undertakings engaged in the business of direct
insurance customarily engage also in the business of               insurance customarily engage also in the business of
reinsurance and are therefore in competition with specialist       reinsurance a n d are therefore in competition with specialist
reinsurance undertakings; whereas it is therefore ap-              reinsurance u n d e r t a k i n g s ; whereas it is the therefore
propriate not to confine coordination to the legal forms           a p p r o p r i a t e n o t t o confine coordination to the legal forms
covered by Directive 78/660/EEC, but to choose a scope             covered by Directive 7 8 / 6 6 0 / E E C , but to choose a scope
which is in line with the First Council Directive 73/239/          which is in line w i t h the First Council Directive 7 3 / 2 3 9 /
EEC of 24 July 1973 on the coordination of laws,                   E E C of 24 July 1973 o n t h e c o o r d i n a t i o n of l a w s ,
regulations and administrative provisions relating to the          regulations a n d administrative provisions relating to the
taking-up and pursuit of the business of direct insurance          taking-up a n d pursuit of the business of direct insurance
other than life insurance (2) and the First Council Directive      other t h a n life insurance (2) a n d the First Council Directive
79/267/EEC of 5 March 1979 on the coordination of laws,            7 9 / 2 6 7 / E E C of 5 M a r c h 1979 on the c o o r d i n a t i o n of laws,
regulations and administrative provisions relating to the          regulations a n d admnistrative provisions relating to the
taking-up and pursuit of the business of direct life               t a k i n g - u p a n d pursuit of the business of direct life
assurance" (3), both as last amended by the Act of Accession       assurance ( 3 ), b o t h as last a m e n d e d by the Act of Accession
of Spain and Portugal, but which also includes certain             of Spain a n d Portugal, but which also includes certain
undertakings that are excluded from the scope of those             undertakings t h a t are excluded from the scope of those
Directives and companies and firms which are specialist            Directives a n d c o m p a n i e s a n d firms which are reinsurance
reinsurance undertakings;                                          undertakings;
(!) OJ No L 193, 18. 7. 1983, p. 1.                                0) OJ No L 193, 18. 7. 1983, p. 1.
(2) OJ No L 228, 16. 8. 1973, p. 3.                                (2) OJ No L 228, 16. 8. 1973, p. 3.
(3) OJ No L 63, 13. 3. 1979.                                       (3) OJ No L 63, 13. 3. 1979.
 ---pagebreak--- 8. 2. 90                                Official Journal of the European Communities No C 30/53
Whereas although, in view of the specific characteristics of       Unchanged
insurance undertakings, it appears appropriate to propose
a separate Directive on annual accounts and consolidated
accounts for such undertakings, this must not result in a set
of standards being established which is separate from those
of Directives 78/660/EEC and 83/349/EEC; whereas such
separate standards would be neither appropriate nor
consistent with the basic principles underlying the
coordination of company law since, given the important
place they occupy in the economy of the Community,
insurance undertakings cannot be excluded from the
framework of standards devised for undertakings gen-
erally; whereas for this reason only the particular
characteristics of insurance undertakings are taken into
account, and this Directive therefore deals only with
exceptions to the rules contained in Directives 78/660/EEC
and 83/349/EEC;
Whereas there are important differences in the structure           Unchanged
and content of the balance sheets of insurance undertakings
in the various Member States; whereas this Directive must
therefore lay down the same structure and the same item
designations for the balance sheets of all insurance
undertakings in the Community;
Whereas, if the annual accounts and consolidated accounts          Unchanged
are to be comparable, a number of basic questions
regarding the presentation of certain transactions in the
balance sheet must be settled;
Whereas, in the interests of greater comparability, it is also     Unchanged
necessary that the content of certain balance sheet items be
determined precisely;
Whereas the same also applies to the composition and               Unchanged
definition of certain items in the profit and loss account;
Whereas the comparability of figures in the balance sheet          Unchanged
and profit and loss account also depends crucially on the
values at which assets and liabilities are entered in the
balance sheet; whereas for a proper understanding of the
financial situation of insurance undertakings it is necessary
to disclose the current value of investments as well as their
value based upon the principle of purchase price or
production costs;
Whereas, in view of the special nature of insurance                Unchanged
undertakings, certain changes are necessary with regard to
the notes on the annual accounts and on the consolidated
accounts;
Whereas, in line with the intention to cover all those             Unchanged
insurance undertakings which are within the scope of
Directives 73/239/EEC and 79/267/EEC as well as certain
others, derogations are not provided for small and
medium-sized insurance undertakings such as are provided
for under the terms of Directive 78/660/EEC, but certain
small mutual undertakings which are excluded from the
scope of the said Directives 73/239/EEC and 79/267/EEC
should not be covered;
 ---pagebreak---   No C 30/54                              Official Journal of the European Communities 8. 2. 90
 Whereas for the same reasons, the scope allowed Member              Unchanged
 States under Directive 83/349/EEC to exempt parent
 undertakings from the consolidation requirements if the
 undertakings to be consolidated do not together exceed a
 certain size has not been extended to insurance undertak-
 ings; whereas in view of its particular nature special
 provisions are needed for the association of underwriters
 known as Lloyd's;
 Whereas the provisions of this Directive should also apply          Unchanged
 to the consolidated accounts drawn up by a parent
 undertaking which is a financial holding company and
 where its subsidiary undertakings are either exclusively or
 mainly insurance undertakings;
 Whereas the examination of problems which arise in                  Unchanged
 connection with this Directive, notably concerning its
 application, requires the cooperation of representatives of
 the Member States and the Commission in the form of a
 contact committee; whereas, in order to avoid the
 proliferation of such committees, it is desirable that the said
 cooperation be achieved by means of the committee
 provided for in Article 52 of Directive 78/660/EEC;
 whereas nevertheless, when examining problems concern-
 ing insurance undertakings, the committee will be
 appropriately constituted;
 Whereas, in view of the complexity of the matter, the               Unchanged
 insurance undertakings covered by this Directive must be
 allowed a longer period than usual to implement the
 provisions thereof,
 HAS ADOPTED THIS DIRECTIVE:
                                                             SECTION 1
                                                 Preliminary provisions and scope
                          Article 1                                  Unchanged
 1. The provisions of Directive 78/660/EEC shall apply to •
insurance undertakings within the meaning of Article 2 of
this Directive, except where this Directive provides
otherwise.
2. Where reference is made in Directive 78/660/EEC to
Articles 9 and 10 (balance sheet) or to Articles 23 to 26
(profit and loss account) of that Directive, such references
shall be construed as references to Article 5 (balance sheet)
or to Article 29 (profit and loss account) of this Directive.
3. Where reference is made in Directive 78/660/EEC to
balance sheet items for which this Directive makes no
equivalent provision, such references shall be deemed to be
references to the items in Article 5 of this Directive which
include the assets and liabilities in question.
 ---pagebreak---   8. 2. 90                                Official Journal of the European Communities                                  No C 30/55
                            Article 2                                                            Article 2
  The coordination measures prescribed by this Directive              1. The coordination measures prescribed by this
  shall apply to companies or firms within the meaning of the         Directive shall apply to companies or firms within the
  second paragraph of Article 58 of the Treaty which are:             meaning of the second paragraph of Article 58 of the
                                                                      Treaty which are:
  (a) undertakings within the meaning of Article 1 of                 (a) undertakings within the meaning of Article 1 of
      Directive 73/239/EEC, excluding those mutual associ-                Directive 73/239/EEC, excluding those mutual associ-
      ations which are excluded from the scope of that                    ations which are excluded from the scope of that
      Directive by virtue of Article 3 thereof but including              Directive by virtue of Article 3 thereof but including
      those institutions referred to in Article 4 thereof except          those institutions referred to in Article 4 thereof except
      where their activity does not consist wholly or mainly              where their activity does not consist wholly or mainly
      of the carrying-on of insurance business;                           of the carrying-on of insurance business;
  (b) undertakings within the meaning of Article 1 of                 (b) undertakings within the meaning of Article 1 of
      Directive 79/267/EEC, excluding those institutions,                 Directive 79/267/EEC, excluding those institutions,
      organizations and mutual associations referred to in                organizations and mutual associations referred to in
      Article 2 (2) and (3) and Article 3 of that Directive;              Article 2 (2) and (3) and Article 3 of that Directive;
      or
 (c) undertakings whose whole or main activity consists of           (c) undertakings carrying on reinsurance        operations.
      reinsurance operations.
 Such undertakings are referred to in this Directive as              Such undertakings are referred to in this Directive as
 insurance undertakings.                                             insurance undertakings.
                                                                     2. The provisions applicable to undertakings referred to
                                                                     in paragraph 1 b) shall apply by analogy to the annual
                                                                     accounts of undertakings writing separately health insur-
                                                                     ance, exclusively or principally according to the technical
                                                                     principles of life insurance.
                            Article 3                                                           Article 3
 1. This Directive shall apply to the association of                 1. This Directive shall apply to the association of
 underwriters known as Lloyd's with such adaptations as              underwriters known as Lloyd's with such adaptations as
 are necessary to take account of the particular nature and          are necessary to take account of the particular nature and
 structure of Lloyd's.                                               structure of Lloyd's.
                                                                    For the purposes of this Directive, Lloyd's shall be
                                                                    considered to be an insurance undertaking, although the
                                                                    information relating to the syndicates of Lloyd's must meet
                                                                    certain requirements in accordance with the objectives of
                                                                    this Directive.
2. The Commission shall submit to the Council, not later            Unchanged
than ..., a report on the adaptations made under para-
graph 1.
                                                             SECTION 2
                       General provisions concerning the balance sheet and the profit and loss account
                           Article 4                                                           Article 4
Article 4 (2) of Directive 78/660/EEC shall not apply to            Articles 4 (2) and 5 of Directive 78/660/EEC shall not apply
insurance undertakings.                                             to insurance undertakings.
 ---pagebreak--- No C 30/56                               Official Journal of the European Communities                                      8. 2. 90
                                                             SECTION 3
                                                    Layout of the balance sheet
                            Article 5                                                            Article 5
The Member States shall prescribe the following layout for          The Member States shall prescribe the following layout for
the balance sheet:                                                  the balance sheet:
                             Assets                                                               Assets
A. Subscribed capital unpaid                                        A. Subscribed capital unpaid
    of which there has been called (unless national law                  of which there has been called (unless national law
    provides that called-up capital be shown under                       provides that called-up capital be shown under
    'Liabilities'. In that case, the part of the capital called          'Liabilities'. In that case, the part of the capital called
    but not yet paid must appear as an asset either under A              but not yet paid must appear as an asset either under A
    or under D.4)                                                        or under D.4)
B. Intangible assets                                                B. Intangible assets
    as described under assets headings B and C.I of                      as described under assets headings B and C.I of
    Article 9 of Directive 78/660/EEC, showing sep-                      Article 9 of Directive 78/660/EEC, showing sep-
    arately :                                                            arately :
    — formation expenses, as defined by national law and                — formation and extension expenses, as defined by
        in so far as national law permits their being shown                  national law and in so far as national law permits
        as an asset                                                          their being shown as an asset
          (unless national law requires their disclosure in the               (unless national law requires their disclosure in the
         notes on the accounts)                                               notes on the accounts)
    — goodwill, to the extent that it was acquired for                  — goodwill, to the extent that it was acquired for
        valuable consideration (unless national law requires                 valuable consideration (unless national law requires
        its disclosure in the notes on the accounts)                         its disclosure in the notes on the accounts)
C.    Investments                                                   C.    Investments
    I.   Land and buildings:                                            I.    Land and buildings:
         — showing separately land and buildings occupied                     showing separately land and buildings occupied by
             by the insurance undertaking for its own                         the insurance undertaking for its own activities
             activities                                                       (including the apportioned values of land and
                                                                              buildings partly so occupied) unless national law
                                                                              requires their disclosure in the notes on the
                                                                              accounts
    II. Investments in affiliated undertakings and par-                 II. Investments in affiliated undertakings and par-
         ticipating interests:                                                ticipating interests:
         1. Shares in affiliated undertakings                                 1. Shares in affiliated undertakings
         2.   Debt securities issued by, and loans to,                        2. Debt securities issued by, and loans to,
              affiliated undertakings                                              affiliated undertakings
         3.   Participating interests                                         3.   Participating interests
         4.   Debt securities issued by, and loans to,                        4.   Debt securities issued by, and loans to,
              undertakings with which the insurance under-                         undertakings with which the insurance under-
              taking is linked by virtue of a participating                       taking is linked by virtue of a participating
              interest                                                             interest
    HI. Other financial investments:                                    III. Other financial investments:
         1. Shares and other variable-yield securities                        1. Shares and other variable-yield securities
         2. Debt securities                                                   2.   Debt securities
         3.   Loans guaranteed by mortgage                                    3.  Participation in investment pools
         4.   Other loans                                                     4. Loans guaranteed by mortgage
         5.   Deposits with credit institutions                              5.   Other loans
                                                                             6.   Deposits with credit institutions
 ---pagebreak---  8. 2. 90                               Official Journal of the European Communities                              No C 30/57
     IV. Investments for the benefit of life insurance policy          IV. Deposits with cedant     undertakings
          holders who bear the investment risk
     V. Own shares (with an indication of their nominal
         value or, in the absence of a nominal value, their
          accounting par value) to the extent that national
          law permits their being shown in the balance sheet
     VI. Deposits with cedant undertakings
D.    Debtors                                                      D. Investments for the benefit of life insurance policy
                                                                       holders who bear the investment risk
     1. Debtors arising out of direct insurance operations,
         with a separate indication of amounts owed by:
          (a) affiliated undertakings
          (b) undertakings with which the insurance under-
              taking is linked by virtue of a participating
              interest
     2.  Debtors arising out of reinsurance operations, with
         a separate indication of amounts owed by:
         (a) affiliated undertakings
         (b) undertakings with which the insurance under-
              taking is linked by virtue of a participating
              interest
    3.   Other debtors, with a separate indication of
         amounts owed by:
         (a) affiliated undertakings
         (b) undertakings with which the insurance under-
              taking is linked by virtue of a participating
              interest
    4.   Subscribed capital called but not paid (unless
         national law provides that called-up capital be
         shown as an asset under A)
E. Tangible assets and consumables                                E.   Debtors
    1. Tangible assets as listed under assets heading C II            For items I, II and III, a separate indication must be
        of Article 9 of Directive 78/660/EEC, other than              given of amounts owned by:
        land and buildings
    2.   Consumables                                                  — affiliated     undertakings
                                                                      — undertakings with which the insurance undertaking
                                                                          is linked by virtue of a participating interest
                                                                      I.   Debtors arising out of direct insurance operations
                                                                            1.   Policyholders
                                                                           2.    Agents
                                                                           3.   Other debtors arising out of direct insurance
                                                                                operations
                                                                     II. Debtors arising out of reinsurance operations
                                                                     III. Other debtors
                                                                     IV. Subscribed capital called but not paid (unless
                                                                           national law provides that called-up capital be
                                                                           shown as an asset under A)
 ---pagebreak--- No C 30/58                              Official Journal of the European Communities                                   8. 2. 90
F. Cash at bank and in hand                                        F.  Other assets
                                                                      I.    Tangible assets as listed under assets heading C II
                                                                            of Article 9c Directive 78/660/EEC, other than
                                                                            land and buildings
                                                                      II. Cash at bank and in hand
                                                                      HI. Own shares (with an indication of their nominal
                                                                            value or, in the absence of a nominal value, their
                                                                           accounting par value) to the extent that national
                                                                            law permits their being shown in the balance sheet
G. Prepayments and accrued income                                  G. Prepayments and accrued income
    1. Accrued interest and rent                                       1. Accrued interest and rent
   2.    Deferred acquisition costs (distinguishing those             2. Deferred acquisition costs (distinguishing those
         arising in non-life and life insurance business)                  arising in non-life and life insurance business)
   3.    Other prepayments and accrued income                         3.   Other prepayments and accrued income
H. Loss for the financial year                                     H. Loss for the financial year
   (unless national law provides for it to be shown under             (unless national law provides for it to be shown under
   A.VI under 'Liabilities')                                          A.VI under 'Liabilities')
                            Liabilities                                                         Liabilities
A. Capital and reserves                                           A. Capital and reserves
   I.   Subscribed capital                                            I.   Subscribed capital
         (unless national law provides for called-up capital               (unless national law provides for called-up capital
        to be shown under this item. In that case, the                     to be shown under this item. In that case, the
        amounts of subscribed capital and paid-up capital                  amounts of subscribed capital and paid-up capital
        must be shown separately)                                          must be shown separately)
   II. Share premium account                                          II. Share premium account
   III. Revaluation reserve                                           III. Revaluation reserve
   IV. Reserves                                                       IV. Reserves
   V. Profit or loss brought forward                                  V. Profit or loss brought forward
   VI. Profit or loss for the financial year                          VI. Profit or loss for the financial year
        (unless national law requires that this item be                    (unless national law requires that this item be
        shown under H under 'Assets' or under H under                      shown under H under 'Assets' or under H under
        'Liabilities')                                                     'Liabilities')
B. Subordinated     liabilities                                   B. Subordinated       liabilities
C. Technical     provisions                                       C. Technical provisions
   1. Unearned premiums (and unexpired risks)                         1. Unearned premiums (and unexpired risks)
        (a) gross amount                                                   (b) gross amount
        (b) reinsurance amount (—)                                         (b) reinsurance amount (—)
 ---pagebreak---  8. 2. 90                                 Official Journal of the European Communities                          No C 30/59
     2.   Life insurance provisions                                     2. Life insurance provisions
          (a) gross amount                                                 (a) gross amount
          (b) reinsurance amount (—)                                       (b) reinsurance amount (—)
               — showing separately the amounts in respect
                  of contracts under which the policy bears
                  the investment risk
     3.   Claims outstanding                                            3. Claims outstanding
          (a) gross amount                                                 (a) gross amount
          (b) reinsurance amount (—)                                       (b) reinsurance amount (—)
     4.  Provision for bonuses and rebates                              4. Provision for bonuses and rebates unless it is not
                                                                           shown under C.2
          (a) gross amount                                                 (a) gross amount
          (b) reinsurance amount (—)                                       (b) reinsurance amount (—)
     5. Equalization provisions required by national law                5. Equalization provisions required by national law
     6.  Other technical provisions                                     6. Other technical provisions
         (a) gross amount                                                  (a) gross amount
         (b) reinsurance amount (—)                                        (b) reinsurance amount (—)
D. Provisions for other liabilities and charges                     Unchanged
     1. Provisions for pensions and similar obligations
     2. Provisions for taxations
     3.  Other provisions
E. Deposits withheld from reinsurers                                Unchanged
F.    Creditors
     (For each of the following items, a separate indication
    must be given of amounts owed to:
     (a) affiliated undertakings
    (b) undertakings with which the insurance underta-
         king is linked by virtue of a participating interest)
    1. Debenture loans, showing convertible loans sep-
         arately
    2. Amounts owed to credit institutions
    3.   Creditors arising out of direct insurance operations
    4.   Creditors arising out of reinsurance operations
    5.   Other creditors, including tax and social security
G. Accruals and deferred income                                     Unchanged
H. Profit for the financial year                                    Unchanged
    (unless national law provides for it to be shown under
    A.VI under 'Liabilities')
 ---pagebreak--- No C 30/60                               Official Journal of the European Communities                                    8. 2. 90
                           Article 6                                 Unchanged
Articles 11,12,27,44,47 (2) and (3) and 51 (2) of Directive
78/660/EEC shall not apply to insurance undertakings.
                           Article 7                                                           Article 7
The provisions of Article 14 of Directive 78/660/EEC shall           The provisions of Article 14 of Directive 78/660/EEC shall
not apply to those commitments which axe taken into                  not apply to those commitments which are linked to the
account in determining the amount of the technical                   normal activity of insurance.
provisions.
                                                            SECTION 4
                                    Special provisions relating to certain balance sheet items
                           Article 8                                 Unchanged
 1. Article 15 (1) and (2) of Directive 78/660/EEC shall
not apply to insurance undertakings.
2. The requirements of paragraph 3 of the abovemen-
tioned Article shall apply to each item of B, C and E.l under
'Assets' in the layout prescribed in Article 5.
                           Article 9                                 Unchanged
Assets: item C.HI.2
Debt securities
1. This item shall comprise negotiable fixed-interest debt
securities issued by credit institutions, by other undertak-
ings or by public bodies, in so far as they are not
appropriate to asset items C.II.2 and C.II.4.
2. Securities carrying interest rates that vary in line with
specific factors, for example the interest rate on the inter-
bank market or on the Euromarket, shall also be regarded
as fixed-interest debt securities.
                          Article 10                                                          Article 10
Assets: item C.III.3 and 4                                          Assets: item CM.4 and 5
Loans guaranteed by mortgages and other loans                       Loans guaranteed by mortgages and other loans
Loans to policy holders for which the policy is the main            Loans to policy holders for which the policy is the main
security shall be included under the heading of 'Other              security shall be included under the heading of 'Other
loans' and their amount shall be disclosed in the notes on          loans' and their amount shall be disclosed in the notes on
the accounts. Loans guaranteed by mortgages shall be                the accounts. Loans guaranteed by mortgages shall be
shown as such even where they are also secured by an                shown as such even where they are also secured by an
insurance policy. Where the amount of 'other loans' not             insurance policy. Where the amount of 'other loans' not
secured by a policy is significant an appropriate breakdown         secured by a policy is significant an appropriate breakdown
shall be given in the notes on the accounts.                        shall be given in the notes on the accounts.
 ---pagebreak---   D.^0                                  Official journal of the European communities                               ^OL^OBDl
                                                                                             Ar^^^
 Assets^itemsC^.HL^and^                                            Assets^ items C ^ . ^ L ^ ^ ^ ^ ^
 deposits with credit institutions                                 deposits with credit institutions
 C^ash at bank and in hand                                         C^ash at bank and in hand
 deposits with credit institutions^comprises amounts the           deposits with credit institutions^comprises amounts the
 withdrawal of which is subject to a time restrictions             withdrawal of which is subject to a time restrictions
 whereas sums deposited with no such restriction shall             whereas sums deposited with no such restriction shall
 appear under assets item re, even if they bear interest.          appear under assets item fu even if they bear interest,
                          Arr^^                                                             Arr^n^
 Assets^ item CA1V                                                 Assets^    ^^f^
 Investments for the benefit oflife insurance policy holders       Investments for the benefit of life insurance policy holders
 who bear the investment risk                                      who bear the investment risk
 Investments for the benefit oflife insurance policy holders       investments for the benefit ofhfe insurance policy holders
 who bear the investment risk shall comprisethe amount of          who bearthe investment risk shall comprise the amount of
 all investments which the insurance undertaking holds by         all investments which the insurance undertaking holds by
 virtue of its commitment under Irfe insurance contracts the      virtue ofits commitment under life insurance contracts the
 benefits ofwhich are expressed by reference to the value of       benefits ofwhich are expressed by reference to the value of
 those investments. Pending further harmonizations                those investments.
 member states may however require or permit insurance
 undertakings to include such investments under the
 headings wheretheywouldappearbutfortheprovisionsof
 this Article.^here use is madeofthis option theamount of
 such investments under eachoftherespectiveheadings
 shall be separately disclosed.
                                                                                            Arr^^
Assets^ item CAV1                                                 Assets^ ^ ^ ^ V
deposits with cedant undertakings                                 deposits with cedant undertakings
In the balance sheet of an undertaking accepting reinsure         In the balance sheet of an undertaking accepting reinsure
ance^ this item shall comprise amounts deposited with^ or         ance^ this item shall comprise amounts deposited with^ or
withheld by^otherinsurance undertakings underinsurance            withheld by^other insurance undertakings underinsurance
contracts.^fhese amounts may not be merged with other             contracts.^fhese amounts may not be merged with other
amounts owed by orto the otherundertakings in question.           amounts owed by orto the otherundertakings in question.
securities deposited with cedant undertakings which               securities deposited with cedant undertakings which
remain the property of the undertaking accepting reinsure         remain the property of the undertaking accepting reinsur
ance shall not be shown here but under the appropriate            ance shall not be shown here but under the appropriate
heading for the type of asset in question,                        heading for the type of asset in question.
                         Ar^^^                                    Unchanged
Assets^itemdi
Accrued interest and rent
Accrued interest and rent shall comprise those items that
representinterestandrentthathavebeen earned up todate
of the balance sheet but have not yet become receivable.
 ---pagebreak---  No C 30/62                               Official Journal of the European Communities                                      8. 2. 90
                            Article 15                                                          Article 15
 Assets: item G.2                                                    Assets: item G.2
 Deferred acquisition costs                                          Deferred acquisition costs
 Deferred acquisition costs shall comprise the amount of             1. Deferred acquisition costs shall comprise the amount
 expenditure incurred on the acquisition of insurance                of expenditure incurred on the acquisition of insurance
 business premium income which relates to a subsequent               business premium income which relates to a subsequent
 financial year or years having regard to the period to which        financial year or years having regard to the period to which
 the individual contract relates. Member States may                  the individual contract relates.
 prohibit the deferral of such amounts in life insurance
 business; any such prohibition must be disclosed in the
 notes on the accounts.
                                                                     2. Member States may prohibit the deferral of such
                                                                     amounts in life insurance business; any such prohibition
                                                                     must be disclosed in the notes on the accounts.
 Where the zillmerization of life insurance contracts results        Where the zillmerization of life insurance contracts results
 in a negative amount in respect of particular contracts the         in a negative amount in respect of particular contracts the
 total of such negative amounts shall be included in deferred       total of such negative amounts shall be included in deferred
 acquisition costs and disclosed in the notes on the accounts.       acquisition costs and disclosed in the notes on the accounts.
                                                                     Where the deferred acquisition costs of life insurance
                                                                     contracts is computed separately from the life insurance
                                                                    provision and exceeds the said provision the excess shall be
                                                                    disclosed in the notes to the accounts.
                           Article 16                                                          Article 16
Liabilities: item A.I                                               Liabilities: item A.I
Subscribed capital                                                  Subscribed capital
This item shall comprise all amounts, irrespective of their         This item shall comprise all amounts, irrespective of their
actual designations, which, in accordance with the legal            actual designations, which, in accordance with the legal
structure of an insurance undertaking, are regarded under           structure of an insurance undertaking, are regarded under
the national law of the Member State concerned as equity            the national law of the Member State concerned as equity
capital subscribed by the share-holders or other pro-               capital subscribed by the share-holders or other persons.
prietors.
                           Article 17                                                          Article 17
Liabilities: item A.IV                                              Liabilities: item A.IV
Reserves                                                            Reserves
Reserves shall comprise all the types of reserves listed in         Reserves shall comprise all the types of reserves listed in
Article 9 of Directive 78/660/EEC under 'Liabilities' A.IV,         Article 9 of Directive 78/660/EEC under 'Liabilities' A.IV,
as defined therein. The Member States may also require              as defined therein. The Member States may also require
other types of reserves if necessary for insurance undertak-        other types of reserves if necessary for insurance undertak-
ings the legal structures of which are not covered by               ings the legal structures of which are not covered by
Directive 78/660/EEC.                                               Directive 78/660/EEC.
These reserves shall be shown separately, as sub-items to           Reserves shall be shown separately, as sub-items to
'Liabilities' item A.IV, in the balance sheets of the insurance     'Liabilities' item A.IV, in the balance sheets of the insurance
undertakings concerned, except for the revaluation reserve,         undertakings concerned, except for the revaluation reserve,
which is shown under 'Liabilities' item A.III.                      which is shown under 'Liabilities' item A.III.
 ---pagebreak---   8. 2. 90                                 Official Journal of the European Communities No C 30/63
                           Article 18                                 Unchanged
  Liabilities: item B
  Subordinated liabilities
 Where it has been contractually agreed that, in the event of
 winding up or of bankruptcy, liabilities, whether or not
 represented by certificates, are to be repaid only after the
 claims of all other creditors have been met, the liabilities in
 question shall be shown under 'Liabilities' item B.
                           Article 19                                 Unchanged
 Liabilities: item C
 Technical provisions
 Article 20 of Directive 78/660/EEC shall not apply to the
 technical provisions disclosed under 'Liabilities' item C.
                           Article 20                                Unchanged
 Liabilities: item C
 Reinsurance amount (deduction)
 The reinsurance amounts shall be determined in accord-
 ance with the stipulations of the reinsurance contracts.
                           Article 21                                Unchanged
 Liabilities: item C.I
 Unearned premiums
 Unearned premiums shall comprise the amount represent-
 ing that part of gross premiums written which is to be
 allocated to a subsequent financial year or subsequent
 financial years. In the case of life insurance Member States
 may, pending further harmonization, permit or require the
 unearned premiums to be included in the life insurance
provisions.
                           Article 22                                Unchanged
Liabilities: item C.6 (or C.I)
Unexpired risks
Unexpired risks shall comprise the amount set aside in
addition to unearned premiums in respect of risks to be
borne by the insurance undertaking after the end of the
financial year, in order to provide for all claims and
expenses in connection with insurance contracts in force in
excess of the related unearned premiums and any premiums
receivable on those contracts. The amount provided for
unexpired risks shall be included in the amount for 'other
technical provisions' at 'Liabilities' item C.6, unless
national legislation provides that it shall be added to
unearned premiums as defined in Article 21 and included in
the amount disclosed at 'Liabilities' item C.l, in which case
the description of that item shall be 'unearned premiums
and unexpired risks'. In either case, where the amount of
unexpired risks is material it shall be separately disclosed
either in the balance sheet or in the notes on the accounts.
 ---pagebreak---  No C 30/64                               Official Journal of the European Communities 8. 2. 90
                           Article 23                                Unchanged
 Liabilities: item C.2
 Life insurance provisions
 The life insurance provisions shall comprise the actuarially
 estimated value of the liabilities net of future premiums in
 respect of life direct insurance and reinsurance contracts.
 Negative amounts resulting from the zillmerization of life
 insurance provisions shall be disclosed in accordance with
 the provisions of Article 15.
                           Article 24                                Unchanged
 Liabilities: item C.3
 Claims outstanding
 1. The provision for claims outstanding shall be the total
estimated ultimate cost to the insurance undertaking of
settling all claims arising from events which have occurred
up to the end of the financial year, whether reported or not,
less amounts already paid in respect of such claims.
2. The provision created through the application of
Methods 1 or 2 described in Article 40 (1) shall be included
in the provision for claims outstanding. The amount so
included shall be disclosed in the notes on the accounts.
                           Article 25                           •   Unchanged
Liabilities: item C.4
Provision for bonuses and rebates
The provision for bonuses and rebates shall comprise
amounts intended for policy holders and other insured
parties by way of bonuses and rebates as defined in
Article 34 to the extent that such amounts have not been
attributed to individual policy holders or other insured
parties through inclusion in the life insurance technical
provisions shown under 'Liabilities' item C.2 or otherwise.
 ---pagebreak---   8. 2. 90                               Official Journal of the European Communities                               No C 30/65
                           Article 26                                                        Article 26
 Liabilities: item C.5                                              Liabilities: item C.5
 Equalization provisions required by national law                   Equalization provisions required by national law
 The amount shown under 'Liabilities' item C.5 shall                 1. The amount shown under 'Liabilities' item C.5 shall
 comprise any amounts set aside in compliance with legal            comprise any amounts set aside in compliance with legal or
 provisions to equalize fluctuations in loss ratios in the          statutory provisions to equalize fluctuations in loss ratios
 coming years. Amounts set aside for similar purposes other         in the coming years. The provisions set up for a similar
 than by virtue of a legal requirement shall be separately          purpose for special risks should also figure amongst these
 disclosed under 'Liabilities' item A.IV. Member States may         equalization provisions.
 however permit or require them to be included in 'other
 technical provisions' at 'Liabilities' item C.6, in which
 event their amount shall be disclosed in the notes on the
 accounts if it is material.
                                                                    2. Amounts not set aside for equalizing fluctuations in
                                                                    loss ratios by virtue of a legal requirement shall be
                                                                    separately disclosed under 'Liabilities' item AIV. Member
                                                                    States may however permit or require them to be included
                                                                    in 'other technical provisions' at 'Liabilities' item C.6 in
                                                                    which event their amount shall be disclosed in the notes on
                                                                    the accounts if it is material.
                          Article 27                                Unchanged
 Liabilities: item E
 Deposits withheld from reinsurers
 In the balance sheet of an undertaking ceding reinsurance,
 this item shall comprise amounts deposited by, or withheld
 from, other insurance undertakings under reinsurance
 contracts. These amounts may not be merged with other
 amounts owed to or by the other undertakings in question.
Where the undertaking ceding reinsurance has received as a
 deposit securities which have been transferred to its
ownership, this item shall comprise the amount owed by
the cedant undertaking by virtue of the deposit.
                                                           SECTION 5
                                             Layout of the profit and loss account
                          Article 28                                                        Article 28
1. The Member States shall prescribe the layout provided           1. The Member States shall prescribe the layout provided
in Article 29 for the profit and loss account.                     in Article 29 for the profit and loss account.
 ---pagebreak--- No C 30/66                               Official Journal of the European Communities                                        8. 2. 90
2. The technical account for non-life-insurance business            2. The technical account for non-life-insurance business
is to be used for those classes of direct insurance which are       is to be used for those classes of direct insurance which are
within the scope of Directive 73/239/EEC and for the                within the scope of Directive 73/239/EEC and for the
corresponding classes of reinsurance business.                      corresponding classes of reinsurance business.
3. The technical account for life insurance business is to          3. The technical account for life insurance business is to
be used for those classes of direct insurance which are             be used for those classes of direct insurance which are
within the scope of Directive 79/267/EEC and for the                within the scope of Directive 79/267/EEC and for the
corresponding classes of reinsurance business.                      corresponding classes of reinsurance business.
                                                                    4. Member States may allow or require undertakings
                                                                    whose activity consists wholly or principally of reinsurance
                                                                    to use the technical account for non-life insurance business
                                                                    for all their business. This shall also apply to undertakings
                                                                    writing direct non-life insurance only and also reinsurance.
                           Article 29                                                           Article 29
                    Profit and loss account                                              Profit and loss account
I.   Technical account — Non-life-insurance        business         I.   Technical account — Non-life-insurance           business
     1.  Premiums:                                                       1. Premiums:
         (a) gross premiums written                                           (a) gross premiums written
         (b) outgoing reinsurance premiums (—)                                (b) outgoing reinsurance premiums (—)
         (c) change in provision for unearned premiums,                       (c) change in provision for unearned premiums,
             net of reinsurance [( + ) or ( —)]                                   and in so far as national legislation authorizes,
                                                                                  the entry of this provision in liabilities under C
                                                                                  1, the unexpired risks provision [ ( + ) or (—)],
                                                                                  net of reinsurance
         (d) earned premiums [result of (a), (b) and (c)]                     (d) earned premiums [result of (a), (b) and (c)]
     2.  Other technical income                                          2. Other technical income, net of reinsurance
     3.  Claims incurred:                                                3.   Allocated investment return ( + ) [HI (8)]
         (a) gross claims paid
         (b) amounts recoverable from reinsurers (—)
         (c) change in provision for claims, net of reinsur-
             ance [( + ) or ( —)]
         (d) net claims incurred [result of (a), (b) and (c)]
 ---pagebreak--- 8. 2. 90                                 Official Journal of the European Communities                               No C 30/67
    4.   Changes in other technical provisions, net of                 4.   Claims incurred:
        reinsurance:
         (a) change in unexpired risks provision [( + ) or                 (a) claims paid:
              (-)]
                                                                                (aa) gross amount
                                                                                (bb) amounts recoverable from reinsurers ( — )
                                                                                (cc) net amount [result of (aa) and (bb)]
         (b) changes in other technical provisions (not                    (b) change in provision for claims, net of reinsur-
             shown under other headings) [( + ) or ( —)]                        ance[( +      )or(-)]
         (c) results of (a) and (b) [( + ) or ( - ) ]                      (c) net claims incurred [result of (a) and (b)]
                                                                       5.  Changes in other technical provisions,       net of
    5. Bonuses and rebates                                                 reinsurance:
                                                                           (a) change in unexpired risks provisions (unless it
        (a) gross bonuses and rebates                                           is included under 1 (c) [( + ) or ( —)]
                                                                           (b) changes in other technical provisions not
        (b) amounts receivable from reinsurers (—)                              shown under other headings [( + ) or ( — )]
                                                                           (c) result of (a) and (b) [( +     )or(-)]
        (c) net bonuses and rebates [a) — b)]
                                                                       6.  Bonuses and rebates, net of reinsurance
   6.   Commissions and other technical charges:
                                                                           (a) Bonuses, net of reinsurance
        (a) commissions
                                                                           (b) Rebates, net of reinsurance
        (b) administrative expenses
        (c) commissions and profit participation from
             other insurance undertakings (—)
        (d) variations in deferred acquisition costs [ ( + ) or
        (e) net amount of commissions and other tech-
             nical charges [result of (a), (b), (c) and (d)]
   7.   Other technical charges, net of reinsurance                    7. Operating     expenses
                                                                          (a) Acquisition costs thereof: provisions
                                                                          (b) administrative     expenses
                                                                          (c) commissions and profit participation         from
                                                                               reinsurance undertakings ( — )
                                                                          (d) variations in deferred acquisition costs [( + )of
                                                                               (-)]
                                                                          (e) Operation expenses, net of reinsurance [result
                                                                               of (a), (b), (c) and (d))
   8. Subtotal (first technical result)
                                                                      8.  Other technical charges, net of reinsurance
   9.  Changes in equalization provisions and reserves
                                                                      9. Subtotal (first technical result)
       (a) changes in legally prescribed equalization
            provisions [( + ) or ( —)]
       (b) changes in other equalization provisions and
            reserves [( + ) or ( —)]
       (c) result of (a) and (b)
 ---pagebreak--- No C 30/68                              Official Journal of the European Communities                                  8. 2. 90
    10. Allocated investment return ( + ) (III. 10)                    10. Changes in equalization provisions and reserves
                                                                           (a) changes in legally or statutorily prescribed
                                                                               equalization provisions [( + ) or ( — )]
                                                                           (b) changes in other equalization provisions and
                                                                               reserves [( + ) or ( — )]
                                                                           (c) result of (a) and (b)
    11. Subtotal second technical result (III.l)                       11. Subtotal (second technical result) (III.l)
II. Technical account — Life insurance business                    II. Technical account — Life insurance business
    1.  Premiums:                                                      1.  Premiums:
        (a) gross premiums written                                         (a) gross premiums written
        (b) outgoing reinsurance premiums (—)                              (b) outgoing reinsurance premiums (—)
        (c) change in provisions for unearned premiums,                    (c) change in provisions for unearned premiums
             net of reinsurance [( + ) or ( —)]
                                                                               [( + ) o r ( - ) ]
        (d) earned premiums [result of (a), (b) and (c)]
                                                                           (d) earned premiums [result of (a), (b) and (c)]
    2.  Income from participating interests, with a sep-
        arate indication of that derived from affiliated               2. Investment income
        undertakings                                                       (a) income from participating interest, with a
                                                                               separate indication of that derived from
                                                                               affiliated undertaking
                                                                           (b) income from other investments, with a sep-
                                                                               arate indication of that derived from affiliated
                                                                               undertakings:
                                                                               (aa) income from land and buildings
                                                                               (bb) income from other     investments
                                                                           (c) value adjustments from     investments
                                                                           (d) profit on the realization of investments
    3.  Income from other investments, with a separate                 3.  Unrealized gains on investment
        indication of that derived from affiliated under-
        takings :
        (a) income from land and buildings
        (b) income from other investments
        (c) result of (a) and (b)
    4.  Profit on the realization of investments                       4.  Other technical income
    5.  Value adjustments on investments                               5. Subtotal: total technical income
    6.  Unrealized gains on investments                                6.  Claims incurred
                                                                           (a) claims paid:
                                                                               (aa) gross amount
                                                                               (bb) amount recoverable from reinsurers ( — )
                                                                               (cc) net amount [result of (aa) and (bb)]
                                                                           (b) change in provision for claims, net of reinsur-
                                                                               ance [( + ) or ( — )]
                                                                           (c) net claims incurred [results of a) and b)[
 ---pagebreak--- 8. 2. 90                                Official Journal of the European Communities                                No C 30/69
    7.   Other technical income                                        7.   Changes in technical provisions,      as far as not
                                                                           shown under 1 (c) or 6 (b)
                                                                           (a) life insurance provision,    net of reinsurance
                                                                                [( +    )or(-)J
                                                                           (b) other technical provisions, net of reinsurance
                                                                               [( +     )or(-)]
    8. Subtotal: total technical income
                                                                      8.   Bonuses and rebates, net of reinsurance
                                                                           (a) bonuses, net of reinsurance
                                                                           (b) rebates, net of reinsurance
    9. Claims incurred
                                                                      9.   Operating expenses
         (a) gross claim paid
                                                                           (a) acquisition costs (thereof    provisions)
         (b) amounts recoverable from reinsurers (—)
                                                                           (b) administrative expenses
         (c) net claims incurred [result of (a) and (b)]                   (c) commissions and profit participation         from
                                                                               reinsurance undertakings ( — )
                                                                           (d) variations in deferred acquisition costs [( + )or
                                                                               (-)]
                                                                           (e) operating expenses, net of reinsurance [result
                                                                               of(a),(b),(c)and(d)]
    10. Changes in technical provisions, as far as not                10. Investment charges :
        shown under 1 (c)
         (a) life insurance provision, net of reinsurance                  (a) charges, including interest, relating to land and
             [( + ) o r ( - ) ]                                                buildings
         (b) other technical provisions, net of reinsurance                (b) other investment management charges, includ-
             [( + ) o r ( - ) ]                                                ing interest
                                                                           (c) value adjustments on investments
                                                                          (d) losses on the realization of investments
    11. Bonuses and rebates:                                          11. Unrealized losses on investments
         (a) gross bonuses and rebates
        (b) amounts receivable from reinsurers (—)
        (c) net bonuses and rebates [(a) — (b)]
    12. Commissions and other technical charges:                      12. Other technical charges
        (a) commissions
        (b) administrative expenses
        (c) commissions and profit participations from
             other insurance undertakings (—)
        (d) variations in deferred acquisition costs [(+) or
             (-)]
        (e) net amount of commissions and other tech-
             nical charges [result of (a), (b), (c) and (d)]
   13. Investment charges:                                            13. Allocated investment return transferred to the non-
                                                                          technical account (II1.5) (—)
        (a) charges, including interest, relating to land and
             buildings
 ---pagebreak--- No C 30/70                              Official Journal of the European Communities                                     8. 2. 90
         (b) other investment management charges, includ-
             ing interest
     14. Losses on the realization of investments                       14. Subtotal: technical result (III.2)
     15. Value adjustments on investments
     16. Unrealized losses on investments
     17. Other technical charges
     18. Subtotal: total technical charges
     19. Subtotal (first technical result)
     20. Allocated investment return (—) (III.9)
     21. Subtotal (second technical result) (III.2)
III. Non-technical   account                                       III. Non-technical    account
     1. Result of technical account — non-life insurance                1. Result of technical account — non-life insurance
         business (1.11)                                                    business (1.11)
     2.  Result of technical account — life insurance                   2. Result of technical account — life insurance
         business (11.21)                                                   business (11.14)
     3.  Income from participating interests, apart from                3.  Income from investment:
         that shown in the technical account, with a                        (a) income from participating interests, with a
         separate indication of that derived from affiliated                    separate indication of that derived from
         undertakings                                                           affiliated undertakings
                                                                            (b) income from other investments, with a sep-
                                                                                arate indication of that derived from affiliated
                                                                                undertakings:
                                                                                (aa) income from land and buildings
                                                                                (bb) income from other investments
                                                                            (c) value adjustments on investments
                                                                            (d) profits on the realization of investments
     4.  Income from other investments, with a separate                 4.  Unrealized gains on investments
         indication of that derived from affiliated undertak-
         ings:
         (a) income from land and buildings
         (b) income from other investments
     5. Value adjustments on investments [ ( + ) or (—)]                5. Allocated investment return from 11.13 ( + )
     6.  Investment charges:                                            6. Investment charges:
         (a) charges, including interest, related to land and               (a) charges, including interest, relating to land and
             buildings                                                          buildings
         (b) other investment management charges, includ-                   (b) other investment management charges, includ-
             ing interest                                                       ing interest
                                                                            (c) investment value    adjustments
                                                                            (d) losses on the realization of investments
 ---pagebreak---  8. 2. 90                                Official Journal of the European Communities                                No C 30/71
     7. Profits on the realization of investments                        7.   Unrealized losses on investments
     8. Losses on the realization of investments                         8. Allocated investment return (1.3)
     9. Allocated investment return transferred from life                9. Other income
         insurance technical account (11.20) ( + )
     10. Allocated investment return transferred to non-                 10. Other charges, including value     adjustments
         life-insurance technical account (1.10) ( —)
     11. Non-investment income                                           11. Tax on profit or loss on ordinary activities
     12. Non-investment charges, including value adjust-                 12. Profit or loss on ordinary activities after taxation
         ments
     13. Tax on profit or loss on ordinary activities                    13. Extraordinary    income
     14. Profit or loss on ordinary activities after taxation            14. Extraordinary    charges
     15. Extraordinary income                                            15. Extraordinary profit or loss
     16. Extraordinary charges                                           16. Tax on extraordinary profit or loss
     17. Extraordinary profit or loss                                    17. Other taxes not shown under the above items
     18. Tax on extraordinary profit or loss                             18. Profit or loss for the financial year
     19. Other taxes not shown under the above items
     20. Profit or loss for the financial year
                                                           SECTION 6
                          Special provisions relating to certain items in the profit and loss account
                          Article 30                                                          Article 30
Non-life technical account item 1.1 (a)                             Non-life technical account item 1.1 (a)
Life technical account item II. 1 (a)                               Life technical account item II. 1 (a)
Gross premiums written                                              Gross premiums written
1. Article 28 of Directive 78/660/EEC shall not apply to            1. Article 28 of Directive 78/660/EEC shall not apply to
insurance undertakings.                                             insurance undertakings.
2. Gross premiums written shall comprise all amounts                2. Gross premiums written shall comprise all amounts
received and receivable in respect of insurance contracts           received and receivable in respect of insurance contracts
issued by or on behalf of the insurance undertaking,                issued by or on behalf of the insurance undertaking,
including:                                                          including:
(a) single premiums, inclusive of annuity considerations;           (a) single premiums, inclusive of annuity considerations,
                                                                        also in life insurance single premiums resulting from
                                                                        bonus and rebate provisions in so far as they must be
                                                                        considered as premiums on the basis of contracts and
                                                                        where national legislation prescribes or authorizes
                                                                        their entry under premiums;
 ---pagebreak---  No C 30/72                              Official Journal of the European Communities                                   8. 2. 90
 (b) additions to premiums in the case of semi-annual,              (b) additions to premiums in the case of semi-annual,
      quarterly or monthly payments and recoveries from                  quarterly or monthly payments and recoveries from
      policy holders of expenses borne by the company;                   policy holders of expenses borne by the company;
 (c) in the case of coinsurance, the insurance undertakings's            in the case of coinsurance, the insurance undertakings's
      portion of total premiums (excluding premiums to be                portion of total premiums (excluding premiums to be
      allocated to coinsurance partners);                                allocated to coinsurance partners);
 (d) reinsurance premiums in respect of business acquired           (d) reinsurance premiums in respect of business acquired
      from ceding companies;                                             from ceding companies;
 after deduction of cancellations and of taxes and parafiscal       after deduction of cancellations and of taxes and parafiscal
 contributions or levies charged by reference to the amount         contributions or levies charged by reference to the amount
 of individual premiums or the volume of premiums.                  of individual premiums or the volume of premiums.
                           Article 31                               Unchanged
 Non-life technical account item I.I (b)
 Life technical account item II. 1 (b)
 Outgoing reinsurance premiums
 Outgoing reinsurance premiums shall comprise all
 amounts paid and payable in respect of outgoing reinsur-
 ance contracts entered into by the insurance undertaking.
                          Article 32                               Unchanged
Non-life technical account item 1.1 (c)
Life-technical account item II. 1 (c)
Change in provision for unearned premiums, net of
reinsurance
The change in the provision for unearned premiums, net of
reinsurance, shall comprise the difference between the
provision for unearned premiums at the beginning of the
financial year and at its end, and shall not include the
change in the provision for unexpired risks. Pending further
coordination, Member States may in the case of life
insurance require or permit the change in unearned
premiums to be included in the change in the life insurance
provision.
 ---pagebreak--- 8. 2. 90                                   Official Journal of the European Communities                                  No C 30/73
                            Article 33                                                          Article 33
Non-life technical account: item 1.3                                  Non-life technical account: item I. 4
Life technical account: item II.9                                     Life technical account: item 11.6
Claims incurred                                                       CI aims incu rred
1. Claims incurred shall comprise all amounts paid and                1. Claims incurred shall comprise all amounts paid and
payable, after taking into account provisions made in                 payable, after taking into account provisions made in
previous years, in respect of liabilities arising in relation to      previous years, in respect of liabilities arising, in relation to
events occurring up to and including the balance sheet date.          events occurring up to and including the balance sheet date.
The amounts in question include annuities, surrenders,                The amounts in question include annuities, surrenders,
adjustments of claims in respect of previous years still              adjustments of claims in respect of previous years still
outstanding at the balance sheet date, losses incurred but            outstanding at the balance sheet date, losses incurred but
not reported, external and internal direct and indirect               not reported, external and internal direct and indirect
claims settlement costs and entries and withdrawals of loss-          claims settlement costs and entries and withdrawals of loss-
provisions to and from ceding insurance undertakings and              provisions to and from ceding insurance undertakings and
reinsurers. Amounts received or receivable as a result of             reinsurers. Amounts received or receivable as a result of
obtaining the legal ownership of insured property or                  obtaining the legal ownership of insured property or
acquiring the rights of the policy holder against third               acquiring the rights of the policy holder against third
parties in connection with the settlement of a claim (salvage         parties in connection with the settlement of a claim (salvage
and subrogation) shall be deducted. Where such amounts                and subrogation) shall be deducted. Where such amounts
are material they shall be disclosed in the notes on the              are material they shall be disclosed in the notes on the
accounts.                                                             accounts.
2. Where the amount of adjustments of claims in aspect                2. Where the amount of adjustments of claims in a given
of previous years still outstanding at the balance sheet date         class in respect of previous years still outstanding at the
is material, it shall be disclosed in the notes on the accounts.      balance sheet date is material, it shall be disclosed in the
                                                                      notes on the accounts.
                            Article 34                                                          Article 34
Non-Life technical account: item 1.5                                  Non-Life technical account: item 1.6
Life technical account: item 11.11                                    Life technical account: item 11.8
Bonuses and rebates                                                   Bonuses and rebates
Bonuses shall comprise all amounts chargeable for the                 Bonuses shall comprise all amounts chargeable for the
financial year which are paid or payable to policy holders            financial year which are paid or payable to policy holders
and other insured parties or provided for their benefit,              and other insured parties or provided for their benefit,
including amounts used to increase technical provisions or            including amounts used to increase technical provisions or
applied to the reduction of future premiums, to the extent            applied to the reduction of future premiums, to the extent
that such amounts represent an allocation of surplus or               that such amounts represent an allocation of surplus or
profit arising on business as a whole or a section of                 profit arising on business as a whole or a section of
business, after deduction of amounts provided in previous             business, after deduction of amounts provided in previous
years which are no longer required.                                   years which are no longer required.
Rebates shall comprise such amounts to the extent that                Rebates shall comprise such amounts to the extent that
they represent a partial refund of premiums resulting from            they represent a partial refund of premiums resulting from
the experience of individual contracts.                               the experience of individual contracts.
Where material, the amount charged for bonuses and that               Where material, the amount charged for bonuses and that
charged for rebates shall be distinguished in the notes on            charged for rebates shall be distinguished in the notes on
the accounts.                                                         the accounts.
 ---pagebreak--- No C 30/74                               Official Journal of the European Communities                                   8. 2. 90
                          Article 35                                                          Article 35
Non-life technical account: item 1.6 (a)                            Non-life technical account: item 1.7 (a)
Life technical account: item 11.12 (a)                              Life technical account: item 11.9 (a)
Commissions                                                         Commissions
Commissions shall comprise all amounts paid or payable in           Commissions shall comprise all amounts paid or payable
respect of insurance contracts which constitute a fee paid,         for the conclusion of insurance contracts which constitute a
otherwise than by virtue of a contract of employment, for           fee paid, otherwise than by virtue of a contract of
services rendered in respect of business introduced to the          employment, for services rendered in respect of business
insurance undertaking. They include amounts paid to                 introduced to the insurance undertaking. They include
agents and brokers but exclude amounts paid to employees            amounts paid to agents and brokers but exclude amounts
(such as members of the direct sales force) acting in the           paid to employees (such as members of the direct sales
ordinary course of their service to the undertaking.                force) acting in the ordinary course of their service to the
                                                                    undertaking.
                          Article 36                                                          Article 36
Non-life technical account: item 1.6 (b)                            Non-life technical account: item 1.7 (b)
Life technical account: item 11.12 (b)                              Life technical account: item 11.9 (b)
Administrative expenses                                             Administrative expenses
Administrative expenses shall include in particular value           Administrative expenses shall include in particular value
adjustments on tangible assets other than land and                  adjustments on tangible assets other than land and
buildings and all staff costs, including commissions paid to        buildings and all staff costs, including commissions paid to
employees acting in the ordinary course of their service to         employees acting in the ordinary course of their service to
the undertaking, with the exception of staff costs incurred         the undertaking, with the exception of staff costs incurred
in connection with claims settlement and those that are             in connection with claims settlement and those that are
properly charged under investment expenses.                         properly charged under investment expenses.
                          Article 37                                                          Article 37
Non-life technical account: item 1.10                               Non-life technical account: item 1.3
Non-technical account: item III. 10                                 Non-technical account: item III.8
Allocation of part of investment return to the non-life             Allocation of part of investment return to the non-life
technical account                                                   technical account
Where part of the investment return is allocated to the             1. Where part of the investment return shown in the non-
technical account for non-life insurance business, the              technical account is allocated to the technical account for
transfer from the non-technical account shall be deducted           non-life insurance, the transfer from the non-technical
at item III. 10 and added at item 1.10. The reason for the          account shall be deducted at item 111.8 and added to item
allocation and the basis on which it is made must be                1.3. The reason for the allocation and the basis on which it
disclosed in the notes on the accounts.                             is made must be disclosed in the notes on the accounts.
 ---pagebreak---  8. 2. 90                                Official Journal of the European Communities                                No C 30/75
                                                                    2. That part of the investment income and charges and of
                                                                    profits and losses on the realization of investments
                                                                    disclosed in technical account for life insurance business
                                                                    which is not used or set aside for the benefit of policy
                                                                    holders and other insured parties may be allocated in whole
                                                                    or in part to the non-technical account, the amount
                                                                    allocated being deducted at item 11.13 and added at item
                                                                    III.5. The reason for the allocation and the basis on which it
                                                                    is made must be disclosed in the notes on the accounts.
                                                                    3. Member States may fix the methods and the basis for
                                                                    the transfer of allocated returns from one part of the profit
                                                                    and loss account to another.
                           Article 38                                                         Article 38
                                                                    Non-life technical account: item I
 Life technical account: item II                                    Life technical account: item II
 Investment income, etc.                                            Investment income and charges
 1. In the case of an undertaking carrying on only life             1. All income and charges from investments together
 insurance business, all investment income and charges and          with profits and losses arising from the realization of
 profits and losses on the realization of investments shall be      investments relating to non-life insurance shall be indicated
 disclosed in the technical account for life insurance              in the non-technical account.
 business.
 2. In the case of an undertaking carrying on both life            2. In the case of an undertaking carrying on only life
 insurance and non-life insurance business, all investment         insurance business, all investment income and charges and
 income and charges and profits and losses on the                  profit and losses on the realization of investments shall be
 realization of investments shall to the extent that they are      disclosed in the technical account for life insurance
 directly connected with the carrying-on of the life insurance     business.
 business be disclosed in the technical account for life
 insurance business.
 3. That part of the investment income and charges and of          3. In the case of an undertaking carrying on both life
 profits and losses on the realization of investments              insurance and non-life insurance business, all investment
disclosed in the technical account for life insurance              income and charges and profits and losses on the
 business which is not used or set aside for the benefit of        realization of investments shall to the extent that they are
policy holders and insured parties may be allocated in             directly connected with the carrying-on of the life insurance
whole or in part to the non-technical account, the amount          business be disclosed in the technical account for life
allocated being deducted at item 11.20 and added at item           insurance business.
III.9. The reason for the allocation and the basis on which it
is made must be disclosed in the notes on the accounts.
                                                                   4. Member States may also prescribe or authorize the
                                                                   indication of income and charges from               investments
                                                                   together with profits and losses arising from the realization
                                                                   of investments according to their origin, i.e. partly in the
                                                                   technical accounts and partly in the non-technical account
                                                                   depending on the allocation of these amounts to the
                                                                   insurers' or the shareholders' fund.
                          Article 39                                                          Article 39
Life technical account: items II.6 and 16                          Life technical account: items 11.3 and 11
Unrealized gains and losses in life insurance business             Unrealized gains and losses in life insurance business
Variations in the amount of the difference between the             Variations in the amount of the difference between the
valuation of investments in accordance with current value          valuation of investments in accordance with current value
and their valuation in accordance with the principle of            and their valuation in accordance with the principle of
purchase price or production cost shall be shown at items          purchase price or production cost shall be shown at items
II.6 and 16 only to the extent that Article 43 (2) applies.        11. 3 and 11 only to the extent that Article 43 (2) applies.
 ---pagebreak---  No C 30/76                              Official Journal of the European Communities            8. 2. 90
                                                            SECTION 7
                                                          Valuation rules
                           Article 40                                                 Article 40
 1. Pending further coordination Member States may                  Unchanged
 require or permit the application of the following methods
 where, owing to the nature of the class or type of insurance
 in question, information about premiums receivable,
 claims payable, or both, for the underwriting year is
 insufficient at the time at which the annual accounts are
 drawn up to enable accurate estimates to be made.
                            Method 1
The excess of the premiums received over the claims and
expenses paid in respect of contracts commencing in the
 underwriting year forms a technical provision, which in
accordance with Article 24 (2) is included in the technical
provision for claims outstanding shown in the balance
sheet at 'Liabilities' item C 3. The amount of this technical
provision is if necessary increased to make it sufficient to
meet present and future obligations. No amount in respect
of the contracts in question *is included in the technical
provisions for unearned premiums and unexpired risks
referred to respectively in Articles 21 and 22. The technical
provision formed in accordance with this method is
replaced by a provision for claims outstanding estimated in
the usual manner at the end of the year following the
underwriting year or at the end of a later year.
                            Method 2
The rules of Method 1 apply, except that the technical
provision referred to in the first sentence of the description
of that method is calculated as a particular percentage of
the premiums receivable.
                            Method 3
The figures shown in the whole of the technical account or
at certain items within it relate to a year which wholly or
partly precedes the financial year.
The amount of the technical provisions shown in the
annual accounts is if necessary increased to make them
sufficient to meet present and future obligations.
 ---pagebreak---  8. 2. 90                                  Official Journal of the European Communities                                No C 30/77
2. Where a method referred to in paragraph 1 is adopted,              2. Where a method referred to in paragraph 1 is adopted,
it shall be applied systematically in successive years unless         it shall be applied systematically in successive years unless
circumstances justify a change. The use of any such method            circumstances justify a change. The use of any such method
shall be disclosed in the notes on the accounts together with         shall be disclosed in the notes on the accounts together with
an explanation of the reasons for it and a statement of its           an explanation of the reasons for it; in the event of a change
effect on the assets, liabilities, financial position and profit      of the method applied, its effect on the assets, the financial
or loss, with particular reference to its effect on the               situation and the profit or loss shall be indicated in the
provisions for unearned premiums and claims outstanding.              notes on the accounts. Where Methods 1 or 2 are used the
Where Methods 1 or 2 are used, the length of time that                length of time that elapses before a provision for claims
elapses before a provision for claims outstanding is created          outstanding is created on the usual basis shall be disclosed
on the usual basis shall be disclosed in the notes on the             in the notes on the accounts. Where Method 3 is used, the
 accounts. Where Method 3 is used, the length of time by              length of time by which the year to which the figures relate
 which the year to which the figures relate precedes the              precedes the financial year shall be disclosed in the notes on
 financial year shall be disclosed in the notes on the                the accounts.
accounts.
3. Where Methods 1 or 2 are used, a provision for claims              Unchanged
outstanding shall be created on the usual basis not later
than the end of the third year following the underwriting
year. Where Method 3 is used, the length of time by which
the year to which the figures relate precedes the financial
year shall not exceed 12 months.
4. For the purposes of this Article the expression                    Unchanged
'underwriting year' means the financial year in which the
insurance contracts in the class or type of insurance in
question commenced.
                           Article 4\                                 Unchanged
Article 32 of Directive 78/660/EEC, which provides that
the valuation of items shown in the annual accounts shall
be based on the principle of purchase price or production
cost, shall in its application to investments be subject to
Article 42 to 45 of this Directive.
                           Article 42                                                           Article 42
 1. As regards the valuation of investments shown in                  Unchanged
Article 5 under 'Assets' item C Member States may require
or permit insurance undertakings to apply current value
calculated in accordance with Articles 44 and 45.
2. Where in life insurance business the benefits provided             2. Where in life insurance business the benefits provided
to policy holders and insured parties are related to the              to policy holders and other insured parties are directly
current value of particular investments or investments as a           related to the current value of particular investments or
whole, those investments shall be shown in the balance               investments as a whole, those investments shall be shown in
sheet at current value.                                              the balance sheet at current value.
3. Where the principle of purchase price or production               Unchanged
cost referred to in Article 32 of Directive 78/660/EEC is
applied to investments, the current value shall be disclosed
in the notes on the accounts.
 ---pagebreak---  No C 30/78                              Official Journal of the European Communities                                    8. 2. 90
4. Where investments are shown at current value, the                Unchanged
value resulting from the application of the principle of
purchase price or production cost shall be disclosed in the
notes on the accounts.
 5. The same basis shall be applied to all investments              Unchanged
 included in any item denoted by an arabic number.
 6. The method applied to each item of investments shall            Unchanged
 be disclosed in the notes on the accounts.
                           Article 43                                                         Article 43
 1. Where current value is applied to investments,                  1. Where current value is applied to investments, Article
 Article 33 (2) and (3) of Directive 78/660/EEC shall apply,        33 (2) and (3) of Directive 78/660/EEC shall apply, except
except as provided in paragraph 2.                                  as provided in paragraph 2.
 2. In the case described in Article 42 (2), the amount of          2. In the case described in Article 42 (2), the amount of
the difference between valuation in accordance with                 the difference between valuation in accordance with
current value and valuation in accordance with the                  current value and valuation in accordance with the
principle of purchase price or production cost shall be             principle of purchase price or production cost shall be
entered in the life insurance provisions in Article 5 at            entered in the life insurance provisions in Article 5 at
 'Liabilities' item C 2. Variations in this difference shall be     'Liabilities' item C 2. Variations in this difference shall be
disclosed in the technical account for life insurance               disclosed in the technical account for life insurance
 business at Article 29, items II.6 and 16.                         business at Article 29, items II.3 and 11.
                           Article 44                                                        Article 44
 1. In the case of investments other than land and                  Unchanged
buildings, current value shall mean market value, save as
provided in paragraph 6.
2. Where investments are quoted on a recognized stock              2. Where investments are quoted on a recognized stock
exchange, market value shall mean the middle market value          exchange, market value shall mean the market value on the
on the balance sheet date or on the last day of trading            balance sheet date or on the last day of trading preceding
preceding that date.                                               that date.
3. Where an active market exists for investments other             3. Where a market exists for investments other than those
than those referred to in paragraph 2, the market value            referred to in paragraph 2, the market value shall mean the
shall mean the average figure at which such investments            average figure at which such investments were traded on
were traded on the balance sheet date or the last day of •         the balance sheet date or the last day of trading preceding
trading preceding that date.                                       that date.
4. Where the application of a method referred to in                Unchanged
paragraphs 2 and 3 produces a figure for particular
investments which, owing to exceptional circumstances at
the date in question, is materially higher than the figure
which would have been obtained in the absence of those
circumstances, the latter figure shall be taken as the market
value.
5. Where at the date at which the accounts are drawn up            Unchanged
investments referred to in paragraphs 2 or 3 have been sold
or there is an intention to sell them within the short term,
the market value shall be reduced by the incurred or
estimated realization costs.
 ---pagebreak--- 8. 2. 90                                Official Journal of the European Communities                               No C 30/79
6. Except where the equity method is applied in                    Unchanged
accordance with Article 59 of Directive 78/660/EEC, all
other investments shall be valued on a basis which has
prudent regard to the likely realizable value.
7. In all cases the precise method of valuation and the            Unchanged
reason for adopting it shall be disclosed in the notes on the
accounts.
                          Article 45                                                         Article 45
 1. Except as provided in paragraph 6, current value in the        1. Except as provided in paragraph 6, current value in the
case of land and buildings shall mean the market value             case of land and buildings shall mean the market value
determined at the date of valuation, reduced as provided in        determined at the date of valuation, reduced as provided in
paragraphs 4 and 5.                                                paragraphs 4 and 5.
2. Market value shall mean the price at which the land             2. Market value shall mean the price at which the land
and buildings could be sold under private contract between         and buildings could be sold under private contract between
a willing seller and an arm's length buyer at the date of          a willing seller and an arm's length buyer at the date of
valuation, it being assumed that the property is publicly          valuation, it being assumed that the property is publicly
exposed to the market, that market conditions permit               exposed to the market, that market conditions permit
orderly disposal and that a normal period, having regard to        orderly disposal and that a normal period, having regard to
the nature of the property, is available for the negotiation       the nature of the property, is available for the negotiation
for the sale.                                                      for the sale.
3. The market value shall be determined through the                3. The market value shall be determined through the
separate valuation of each item of land and buildings              separate valuation of each item of land and buildings
carried out not less frequently than every five years by           carried out not less frequently than every five years by
persons approved for the purpose by the Member State in            persons approved for the purpose either by the Member
which the head office of the insurance undertaking is              State in which the head office of the undertaking is situated
situated.                                                          or, where different, by the Member State in which the land
                                                                   and buildings are situated.
4. Where the value of any item of land and buildings has           4. Where the value of any item of land and buildings has
diminished at the balance sheet date, the appropriate value        diminished at the balance sheet date, the appropriate value
adjustment shall be made. The lower value thus arrived at          adjustment shall be made. This adjustment may be on the
shall not be increased in subsequent balance sheets unless         basis of a percentage reduction recommended by persons
such increase results from a new determination of market           approved as aforesaid in respect of land and buildings the
value arrived at in the conditions prescribed in para-             value of which has diminished since the last valuation by
graphs 2 and 3.                                                    such persons. The lower value thus arrived at shall not be
                                                                   increased in subsequent balance sheets unless such increase
                                                                   results from a new determination of market value arrived at
                                                                   in the conditions prescribed in paragraphs 2 and 3.
5. Where at the date at which the accounts are drawn up            5. Where at the date at which the accounts are drawn up
land and buildings have been sold or there is an intention to      land and buildings have been sold or there is an intention to
sell them within the short term, the value arrived at in           sell them within the short term, the value arrived at in
accordance with paragraphs 2 and 4 shall be reduced by the         accordance with paragraphs 2 and 4 shall be reduced by the
incurred or estimated realization costs.                           incurred or estimated realization costs.
6. Where it is impossible to determine the market value of         6. Where it is impossible to determine the market value of
an item of land and buildings, the value arrived at on the         an item of land and buildings, the value arrived at on the
basis of the principle of purchase price or production cost        basis of the principle of purchase price or production cost
shall be treated as the current value.                             shall be treated as the current value.
7. In all cases the method by which current value has been         7. In all cases the method by which current value has been
arrived at and the year or years in which valuations were          arrived at and the year or years in which valuations were
last carried out in accordance with paragraph 3 shall be          last carried out in accordance with paragraph 3 shall be
disclosed in the notes on the accounts.                           disclosed in the notes on the accounts.
 ---pagebreak--- No C 30/80                                Official Journal of the European Communities                                    8. 2. 90
                           Article 46                                                          Article 46
1. Article 33 of Directive 78/660/EEC shall apply to                 Article 33 of Directive 78/660/EEC shall apply to insurance
insurance undertakings in the following manner:                      undertakings in the following manner:
(a) references to 'tangible fixed assets' shall be construed         (a) paragraph 1 (a) shall apply to assets shown under F.l in
     as references to assets listed under 'Assets' C.II.2,3 and          Article 5 of this Directive;
     4 in Article 9 of Directive 78/660/EEC;
(b) the reference to 'stocks' shall be construed as a                (b) subject to Article 43 of this Directive, Article 33 of
     reference to assets shown in this Directive at Article 5,           Directive 78/660/EEC shall not apply to assets shown
     'Assets' item E.2.                                                  under C.II, III, IV, D and F.III of Article 5 of this
                                                                         Directive.
2. Subject to Article 43 of this Directive, Article 33 of
Directive 78/660/EEC shall not apply to investments which
are financial fixed assets within the meaning of 'Assets'
CHI of Article 9 of Directive 78/660/EEC.
                           Article 47                                                          Article 47
The application of Article 35 of Directive 78/660/EEC to             The application of Article 35 of Directive 78/660/EEC to
insurance undertakings shall be subject to the following             insurance undertakings shall be subject to the following
modifications:                                                       modifications:
(a) references to 'fixed assets' shall be construed as               (a) that Article shall apply to assets shown under B, C and
     references to assets shown in this Directive at Article 5,          F.l of Article 5 of this Directive;
     'Assets' items B, C and E . l ;
(b) references to 'financial fixed assets' shall be construed        (b) paragraph 1 (c) (aa) shall apply to assets shown under
     as references to assets shown in this Directive at                   C.II, 111, IV, D and F.III of Article 5 of this Directive.
     Article 5, 'Assets' items C.II, III, IV, V and VI.
                           Article 48                                                          Article 48
In Article 38 of Directive 78/660/EEC the reference to               Article 38 of Directive 78/660/EEC shall apply to assets
tangible fixed assets, raw materials and consumables shall,          shown under F.l in Article 5 of this Directive.
as regards insurance undertakings, be construed as a
reference to assets shown in this Directive at Article 5
'Assets' item E.
                           Article 49                                                          Article 49
For the application of Article 39 of Directive 78/660/EEC            Article 39 of Directive 78/660/EEC shall apply to assets
to insurance undertakings the reference to current assets            shown under E.l, 11 and HI and F.II of Article 5 of this
shall be construed as a reference to assets shown in this            Directive.
Directive at Article 5, 'Assets' items D.l, 2 and 3 and F.
                           Article 50                                Unchanged
In non-life insurance the amount of deferred acquisition
costs shall be established on a basis consistent with that
followed for unearned premiums.
 ---pagebreak---  8. 2. 90                                 Official Journal of the European Communities                                No C 30/81
 In life insurance the calculation of the amount of
 acquisitions costs to be deferred may form part of the
 actuarial calculation referred to in Article 55.
                           Article 51                                Unchanged
 Subject to Article 42, debt securities included under
 Article 5, 'Assets' items C.II and III, shall be shown in the
 balance sheet or purchase price. The Member States may,
 however, permit or require debt securities to be shown in
 the balance sheet at the amount repayable at maturity.
 Where the purchase price of such debt securities exceeds the
 amount repayable at maturity, the amount of the difference
 must be charged to the profit and loss account. The amount
 of the difference may however be written off in instalments
 so that it is completely written off no later than the time of
 repayment of the debt securities. The difference must be
 shown separately in the balance sheet or in the notes on the
 accounts.
Where the purchase price of such debt securities is less than
the amount repayable at maturity, the Member States may
permit or require the amount of the difference to be
released to income in instalments during the period
remaining until repayment. The difference must be shown
separately in the balance sheet or in the notes on the
accounts.
                           Article 52                                                          Article 52
The amount of technical provisions shall be such as to               1. The amount of technical provisions shall be such as to
ensure that all liabilities arising out of insurance contracts      ensure that all liabilities arising out of insurance contracts
can be met by the insurance undertaking.                            can be met by the insurance undertaking.
                                                                    2. For the valuation of technical provisions, the method
                                                                    of the weighted average or other comparable methods may
                                                                    be used.
                           Article 53                               Unchanged
The provision for unearned premiums shall be computed
for each individual contract and pro rata temporis by
reference to the proportion of the period covered by the
contract which extends over a period following the end of
the financial year. Member States may permit the use of
flat-rate methods where they are likely to give ap-
proximately the same results as the individual calculations.
If the nature of risks is such that the pro rata temporis
method does not reflect the expected risk experience,
appropriate adjustments shall be made.
 ---pagebreak--- No C 30/82                               Official Journal of the European Communities                                8. 2. 90
                           Article 54                               Unchanged
The provision for unexpired risks shall be computed on the
basis of the probable claims arising from events after the
end of the financial year from contracts concluded before
the date, in so far as they exceed the provision for unearned
premiums.
                           Article 55                                                         Article 55
The life insurance provision shall be computed separately           1. The life insurance provision shall be computed
for each insurance contract. Approximate methods may                separately for each insurance contract. Approximate
however be used where they are likely to give ap-                   methods may however be used where they are likely to give
proximately the same results as the individual calculations.        approximately the same result as the individual calcu-
A computation must be made annually under the                       lations. A summary of the principal assumptions must be
responsibility of an actuary on the basis of recognized             disclosed in the notes on the accounts.
actuarial methods. A summary of the principal assump-
tions must be disclosed in the notes on the accounts.
                                                                    2. A computation must be made annually by an external
                                                                    actuary or one employed by the reporting insurance
                                                                    company recognized as such by virtue of Directive 89/48/
                                                                    EEC C1) on the recognition of higher-education diplomas
                                                                    on the basis of recognized actuarial methods.
                           Article 56                                                         Article 56
1. The provisions for claims outstanding shall in                   Unchanged
principle be calculated case by case, but statistical methods
may be used if they result in an adequate provision having
regard to the nature of the risks. For the calculation of
claims incurred but not reported, regard shall be had to
past experience and all other relevant factors.
2. External and internal direct and indirect claims                 Unchanged
settlement costs shall be taken into account when
calculating the provision.
3. Where in calculating the provision account is taken of           Unchanged
estimated amounts receivable as a result of obtaining the
legal ownership of insured property or acquiring the rights
of the policy holder against third parties in connection with
the settlement of a claim (salvage and subrogation), a
prudent basis shall be adopted. Where such amounts are
material they shall be disclosed in the notes on the
accounts.
                                                                    (!) OJ No L 19, 24. 1. 1989, p.16.
 ---pagebreak--- 8. 2. 90                                Official Journal of the European Communities                                No C 30/83
4. Where in non-life insurance benefits resulting from a           4. Where in non-life insurance benefits resulting from a
claim have to be paid in the form of an annuity, the               claim have to be paid in the form of an annuity, the
amounts to be provided for this purpose shall be calculated        amounts provided for this purpose shall be calculated
actuarially and included in the provision for claims               actuarially under the responsibility of an actuary recog-
outstanding.                                                       nized as such by virtue of Directive 89/48/EEC and
                                                                   included in the provision for claims outstanding.
5. Where, apart from cases in which the benefits have to           5. Apart from cases, in which the benefits have to be
be calculated actuarially, a deduction is exceptionally made       calculated actuarially Member States may authorize that
in respect of investment income which may be attributable          for particular claims, because of the expected delay in
to the provisions for particular claims because of the             settlement, a deduction should be made in respect of
expected delay in settlement, such deductions shall be             investment income. Where such discounting is adopted, it
calculated on an actuarial basis. Where such discounting is        must be made on a actuarial basis and disclosed in the notes
adopted it must be disclosed in the notes on the accounts          on the accounts together with a explanation of the reasons
together with an explanation of the reasons for it and a           for it and a statement of its effects on the assets, liabilities,
statement of its effects on the assets, liabilities, financial     financial position and profit or loss.
position and profit or loss.
Implicit discounting, whether resulting from the placing of        Implicit discounting, whether resulting from the placing of
a present-day value on a provision for an outstanding claim        a present-day value on a provision for an outstanding claim
which is expected to be settled later at a higher figure, or       which is expected to be settled later at a higher figure or
otherwise brought about, is not permissible.                       otherwise brought about, is not permissible.
                          Article 57                               Unchanged
Pending further coordination those Member States which
require the formation of equalization provisions shall
prescribe the valuation rules to be applied to them.
                                                           SECTION 8
                                             Contents of the notes on the accounts
                         Article 58                                                         Article 58
1. In place of the information required by Article 43 (1)          1. In place of the information required by Article 43 (1)
(8) of Directive 78/660/EEC, insurance undertakings shall          (8) of Directive 78/660/EEC, insurance undertakings shall
indicate, in the notes on the accounts, gross premiums             indicate, in the notes on the accounts, gross premiums
within the meaning of Article 30 of this Directive, broken         within the meaning of Article 30 of this Directive, broken
down by categories of activity and into geographical               down by categories of activity and into geographical
markets as follows:                                                markets as follows:
        as regards non-life insurance, firstly as between              — as regards direct non-life insurance, firstly as
        direct insurance and acceptances of reinsurance,                   between direct insurance and acceptances of
        and then within each of those categories between:                  reinsurance, and then within the former of these
                                                                           categories between:
    — accident and health,                                             — accident and health,
        motor,                                                         — motor,
        marine, aviation and transport,                                — marine, aviation and transport,
        fire and other damage to property,                             — fire and other damage to property,
        liability,                                                     — liability,
        credits and suretyship,                                        — credits and suretyship,
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    — legal expenses,                                                    — legal expenses,
    — assistance,                                                        — assistance,
    — miscellaneous,                                                     — miscellaneous,
     except that disclosure under any of these headings is               except that disclosure under any of these headings is
     not necessary if it accounts for less than 10 % of the              not necessary if it accounts for less than 10 % of the
     non-life gross premiums in direct insurance or in                   non-life gross premiums in direct insurance or in
     reinsurance respectively;                                           reinsurance respectively;
     — as regards life insurance, firstly as between direct              — as regards life insurance, firstly as between direct
         insurance and acceptances of reinsurance, if such                   insurance and acceptances of reinsurance, if such
         acceptances amount to at least 10 % of total life                   acceptances amount to at least 10 % of total life
         insurance gross premiums, and then within each of                   insurance gross premiums, and then within the
         those categories to indicate:                                       former of those categories to indicate:
     — periodic premiums,                                                — periodic premiums,
     — single premiums, including annuity considerations,                — single premiums, including annuity considerations,
     — premiums under group contracts,                                   — premiums under group contracts,
     — premiums for contracts under which the policy                     — premiums for contracts under which the policy
         holders bear the investment risk,                                   holders bear the investment risk,
     except that disclosure under any of these headings is               except that disclosure under any of these headings is
     not necessary if it accounts for less than 10 % of the life         not necessary if it accounts for less than 10 % of the life
     gross premiums in direct insurance or in reinsurance                gross premiums in direct insurance or in reinsurance
     respectively;                                                       respectively;
     — as regards both non-life and life insurance, the total            — as regards both non-life and life insurance, the total
         gross premiums resulting from contracts concluded                   gross premiums resulting from contracts concluded
         by the insurance undertaking in each Member State                   by the insurance undertaking in each Member State
         or other country in which it has an establishment                   or other country in which it has an establishment
         (head office, branch or agency), except that such                   (head office, branch or agency), except that such
         disclosure is not necessary where the figure for any                disclosure is not necessary where the figure for any
         particular Member State or other country accounts                   particular Member States or other country accounts
         for less than 5 % of the total gross premiums.                      for less than 5 % of the total gross premiums. For
                                                                             reinsurance acceptances, this breakdown shall be
                                                                             undertaken on the basis of the ceding undertaking's
                                                                             head office.
2. The reference in Article 43 (1) (10) of Directive 78/660/         2. With regard to reinsurance acceptances, the break-
EEC to Articles 31 and 34 to 42 thereof shall be construed           down of gross premiums per category in accordance with
as a reference to those Articles as modified for the purposes        paragraph 1 shall be undertaken separately for non-life
of their application to insurance undertakings by the                insurance and for life insurance when the undertaking
provisions of this Directive.                                        operates in both categories but must establish only one
                                                                     single technical account.
3. Insurance undertakings shall indicate, in the notes on            3. The reference in Article 43 (1) and (10) of Directive 78/
the accounts, assets shown respectively under items C.III.l          660/EEC to Articles 31 and 34 to 42 thereof shall be
(shares) and CHI.2 (debt securities) of Article 5 broken             construed as a reference to those amended Articles for the
down between quoted and unquoted investments.                        purposes of their application to insurance undertakings by
                                                                     this Directive.
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                                                           SECTION 9
                                          Provisions relating to consolidated accounts
                         Article 59                                                          Article 59
 1. Insurance undertakings shall draw up consolidated               Unchanged
accounts and a consolidated annual report in accordance
with Directive 83/349/EEC, in so far as this section does
not provide otherwise.
2. In so far as a Member State does not make use of                 2. In so far as a Member State does not make use of
Article 5 of Directive 83/349/EEC, paragraph 1 shall also           Article 5 of Directive 83/349/EEC, paragraph 1 shall also
apply to parent undertakings the sole object of which is to         apply to parent undertakings, the sole and essential object
acquire holdings and turn them to profit, where those               of which is to acquire holdings and turn them to profit
subsidiary undertakings are either exclusively or mainly            where those subsidiary undertakings are either exclusively
insurance undertakings.                                             or mainly insurance undertakings.
                         Article 60                                                          Article 60
Directive 83/349/EEC shall apply subject to the following          Directive 83/349/EEC shall apply subject to the following
provisions:                                                        provisions:
1. Articles 4, 6, 15 and 40 shall not apply;                        1. Articles 4, 6, 15 and 40 shall not apply;
2.  The information referred to in the first two indents of        2. The information referred to in the first two indents of
    Article 9 (2), namely:                                              Article 9 (2), namely:
    — the amount of the fixed assets, and                               — the amount of the fixed assets, and
    — net turnover                                                     — net turnover
    shall be replaced by 'Gross premiums written' as                    shall be replaced by 'Gross premiums written' as
    defined in Article 30 of this Directive.                            defined in Article 30 of this Directive.
3.  For the purposes of the layout of consolidated                 3. Article 18 is applicable except that in the consolidated
    accounts, the reference in Article 17 to Articles 9 and            accounts technical provisions need not be set up where
    10 (balance sheet) and 23 to 26 (profit and loss account)          such provisions are not set up under the legislation
    of Directive 78/660/EEC shall be deemed to be a                    applicable to the subsidiary.
    reference to Articles 5 (balance sheet) and 29 (profit
    and loss account) of this Directive. Articles 4, 7 to 27,
    28 and 30 to 39 of this Directive shall also apply.
                                                                       Exceptions from the balance sheet and valuation
                                                                       methods applicable to the consolidated accounts are to
                                                                       be disclosed and explained in the notes on the
                                                                       consolidated accounts.
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   For the purposes of valuing assets and liabilities to be      4.  For the purposes of the layout of consolidated
   included in consolidated accounts, the reference in               accounts, the reference in Article 17 to Articles 9 and
   Articles 29 and 33 to Articles 31 to 42 and 60 of                  10 (balance sheet) and 23 to 26 (profit and loss account)
   Directive 78/660/EEC shall be deemed to be a reference            of Directive 78/660/EEC shall be deemed to be a
   to those Articles as amended in their application by              reference to Articles 5 (balance sheet) and 29 (profit
   Articles 40 to 57 of this Directive.                              and loss account) of this Directive. Articles 4, 7 to 27,
                                                                     28 and 30 to 39 of this Directive shall also apply.
   Article 34 shall apply in respect of the contents of the          Article 26 (1) (b) shall not apply to the consolidated
   notes on consolidated accounts, subject to Article 58 of          accounts where the underlying transaction has been
   this Directive.                                                   concluded according to normal market conditions and
                                                                     the income is allocated to the provision for bonuses and
                                                                     rebates; this does not apply to transactions relating to
                                                                     reinsurance. Exceptions to the principle of income and
                                                                     expenditure consolidation are to be disclosed in the
                                                                     notes and are to be explained where there is a material
                                                                     effect on the assets, liabilities, financial position and
                                                                     profit and loss of all the undertakings included in the
                                                                     consolidation.
                                                                 6.  Where a reinsurance undertaking is included in the
                                                                    consolidation and because of that fact there is a period
                                                                     of more than three months between the consolidated
                                                                    balance sheet date and the balance sheet date of other
                                                                    undertakings, Article 27 (3) shall apply except that in
                                                                     this case the balance sheet date of an undertaking
                                                                    included in the consolidation shall not precede the
                                                                    consolidated balance sheet date by more than six
                                                                    months.
                                                                 7. For the purposes of valuing assets and liabilities to be
                                                                    included in consolidated accounts, the reference in
                                                                    Articles 29 and 33 to Articles 31 to 42 and 60 of
                                                                    Directive 78/660/EEC shall be deemed to be a reference
                                                                    to those Articles as amended in their application by
                                                                    Articles 40 to 57 of this Directive.
                                                                    Notwithstanding Article 29, values attributed to items
                                                                    listed under liabilities heading C of Article 5 and
                                                                    calculated on calculation bases differing from those
                                                                    used for the consolidation can be maintained; the use
                                                                    of this provision shall be disclosed in the notes on the
                                                                    consolidated accounts.
                                                                8. Article 34 shall apply in respect of the contents of the
                                                                    notes on consolidated accounts, subject to Article 58 of
                                                                    this Directive.
 ---pagebreak---  8. 2. 90                                Official Journal of the European Communities No C 30/87
                                                            SECTION 10
                                                             Publication
                          Article 61                                  Unchanged
 1. The duly approved annual accounts of insurance
 undertakings, together with the annual reports and the
 opinion of the persons responsible for auditing the
 accounts shall be published as laid down by the laws of
 each Member State in accordance with Article 3 of First
 Council Directive 68/151/EEC of 9 March 1968 on
 coordination of safeguards which for the protection of the
 interests of members and others, are required by Member
 States of companies within the meaning of the second
 paragraph of Article 58 of the Treaty, with a view to
 making such safeguards equivalent throughout the Com-
 munity (1).
 The laws of a Member State may, however, permit the
 annual report not to be published as stipulated above. In
 that case, it shall be made available to the public at the
 company's registered office in the Member State con-
 cerned. It must be possible to obtain a copy of all or part of
 any such report upon request. The price of such a copy
 must not exceed its administrative cost.
2. Paragraph 1 shall also apply to the duly approved
consolidated accounts, the consolidated annual reports and
the opinions submitted by the persons responsible for
auditing the accounts.
3. Where an insurance undertaking which has drawn up
annual accounts or consolidated accounts is not established
as one of the types of company listed in Article 1 (1) of
Directive 78/660/EEC and is not required by its national
law to publish the documents referred to in paragraphs 1
and 2 as prescribed in Article 3 of Directive 68/151/EEC, it
must at least make them available to the public at its
registered office. It must be possible to obtain copies of
such documents on request. The price of such copies must
not exceed their administrative cost.
4. Member States shall provide for appropriate sanctions
for failure to comply with the publication rules laid down
in this Article.
(!) OJ No L 65, 14. 3. 1968, p. 8.
 ---pagebreak--- No C 30/88                              Official Journal of the European Communities 8. 2. 90
                                                          SECTION 11
                                                        Final provisions
                         Article 62                                Unchanged
The Contact Committee established in accordance with
Article 52 of Directive 78/660/EEC shall, when constituted
appropriately, also have the following functions:
(a) to facilitate, without prejudice to Articles 169 and 170
    of the Treaty, harmonized application of this Directive
     through regular meetings dealing in particular with
    practical problems arising in connection with its
     application;
(b) to advise the Commission, if necessary, on additions or
     amendments to this Directive.
                          Article 63                               Unchanged
1. Member States shall bring into force the laws,
regulations and administrative provisions necessary for
them to comply with this Directive before 1 January ...
They shall forthwith inform the Commission thereof.
2. A Member State may provide that the provisions
referred to in paragraph 1 above shall first apply to annual
accounts and consolidated accounts for financial years
beginning on 1 January ... or during the calendar year ...
3. Member States shall ensure that they communicate to
the Commission the texts of the main provisions of
national law which they adopt in the field covered by this
Directive.
                          Article 64                               Unchanged
This Directive is addressed to the Member States.