CELEX: 51980PC0854
Language: en
Date: 1980-12-16
Title: Amendment to the proposal for a Council Directive on the coordination of laws, regulations and and administrative provisions relating to insurance contracts

No C 355/30                          Official Journal of the European Communities                                   31. 12.80
              Amendment of the proposal for a Council Directive on the coordination of laws,
                      regulations and administrative provisions relating to insurance contracts (')
              (Submitted to the Council by the Commission pursuant to the second paragraph of Article
                                      149 of the EEC Treaty on 30 December 1980)
                     INITIAL PROPOSAL                                                       NEW PROPOSAL
 THE COUNCIL OF THE EUROPEAN                                          THE COUNCIL OF THE EUROPEAN
 COMMUNITIES                                                          COMMUNITIES
                                                Citations unchanged
                                               First r e c i t a l u n c h a n g e d
                                                      Second recital
Whereas the second Council Directive . . . / . . ./EEC               Whereas the second Council Directive . . . / . . ./EEC
of . . . on the coordination of laws, regulations and                of . . . on the coordination of laws, regulations and
administrative provisions relating to direct insurance               administrative provisions relating to direct insurance
other than life assurance and laying down provisions                 other than life assurance and laying down provisions
to facilitate the effective exercise of freedom to                   to facilitate the effective exercise of freedom to
provide services granted the parties freedom to                      provide services, granted the parties freedom to
choose the law applicable to the contract, firstly in                choose the law applicable to the contract, firstly in
the case of risks classified as transport, primarily on              the case of risks classified as transport, primarily on
account of their frequently international character,                 account of their frequently international character,
and secondly in the case of certain risks which are                  and secondly in the case of certain risks which are
defined by precise criteria in respect of which there is             defined by precise criteria; (13 words deleted);
less need of protection for insured persons;
                                                       New recital
                                                                     Whereas coordination of laws relating to insurance
                                                                     contracts would facilitate the provision of services in a
                                                                     Member State by those providing them in another
                                                                     Member State;
                                                      Third recital
Whereas, however, pending subsequent coordination                    Whereas in coordinating the laws relating to
of national rules governing insurance contracts, that                insurance contracts it is necessary to maintain the
Directive maintained in respect of other risks the                   fairest balance between the interests of the insurer on
principle of the application of the law in force in the              the one hand and the protection of the insured person
State in which the risk is situated; whereas such                    on the other; whereas such coordination is likely to
coordination, by establishing a balance between the                  facilitate an extension of the freedom of choice of the
interests of the insurer on the one hand and the                     law applicable to the contract;
protection of the policyholder and the insured person
on the other, is likely to enable freedom of choice to
be extended and thus to facilitate the exercise of
freedom to provide services;
(') OJ No C 190, 28. 7. 1979, p. 2.
 ---pagebreak--- 31.12.80                           Official Journal of the European Communities                             No C 355/31
                      INITIAL PROPOSAL                                                NEW PROPOSAL
                                                      Fourth recital
Whereas it was considered advisable to exclude from              Whereas it was considered advisable to exclude from
the scope of the Directive marine, aviation and                  the scope of the Directive, marine, aviation and
transport insurance because of their widely inter-               transport insurance because of their widely inter-
national character and the freedom traditionally                 national character and the freedom traditionally
allowed to the parties in concluding such contracts;             allowed to the parties in concluding such contracts,
whereas the credit and suretyship insurance classes              and sickness insurance which in some cases is operated
display peculiarities which, pending subsequent                  in a manner similar to life assurance and has special
coordination, justify not making them subject to the             technical features; whereas the credit and suretyship
provisions of this Directive as they stand;                      insurance classes display peculiarities which, pending
                                                                 subsequent coordination, justify not making them
                                                                 subject to the provisions of this Directive as they
                                                                 stand;
                                                        Fifth recital
Whereas among the fundamental problems posed by                  Whereas among the problems (one word deleted)
legislation     on     insurance     contracts   are   the       posed by legislation on insurance contracts are the
consequences resulting firstly from the conduct of the           consequences resulting (one word deleted) from the
policyholder at the time of the conclusion and in the            conduct of the policyholder at the time of the
course of the contract concerning the declaration of             conclusion and in the course of the contract
the risk and of the claim, and secondly his attitude             concerning the declaration of the risk and of the
with regard to the measures to be taken in the event             claim, and (three words deleted) with regard to the
 of a claim;                                                      measures to be taken in the event of a claim;
                                                      Sixth recital
Whereas it is also necessary to regulate certain                 Whereas it is also desirable to coordinate the law
general questions relating in particular to the                   relating in particular to the existence of cover
existence of cover depending on the payment of the                depending on the payment of the premium, the
premium, the duration of the contract, and the                    duration of the contract, and the position of insured
position     of    insured persons who are             not        persons who are not policyholders;
policyholders;
                                               Seventh recital unchanged
                                                                  HAS ADOPTED THIS DIRECTIVE:
                           Article 1                                                      Article 1
 The object of this Directive is to coordinate the                The object of this Directive is to coordinate the
 fundamental laws, regulations and administrative                 important laws, regulations and administrative
 provisions governing insurance contracts relating to             provisions governing insurance contracts covering
 one of the classes contained in point A of the Annex             risks situated in Member States of the Community
 to Directive 73/239/EEC of 24 July 1973 on the                   and relating to one of the classes contained in point A
 coordination of laws, regulations and administrative             of the Annex to Directive 73/239/EEC of 24 July
 provisions relating to the taking-up and pursuit of               1973 on the coordination of laws, regulations and
 the business of direct insurance other than life assur-          administrative provisions relating to the taking-up
 ance ('), with the exception of the classes contained            and pursuit of the business of direct insurance other
 in points 4 (railway rolling stock), 5 (aircraft), 6             than life assurance 1, with the exception of the classes
 ---pagebreak---  No C 355/32                             Official Journal of the European Communities                             31. 12.80
                        INITIAL PROPOSAL                                                   NEW PROPOSAL
  (ships, sea, lake and river and canal vessels), 7 (goods         contained in points 2 (sickness), 4 (railway rolling
  in transit), 11 (aircraft liability), 12 (liability for ships,   stock), 5 (aircraft), 6 (ships (sea, lake and river and
  sea, lake and river and canal vessels), 14 (credit) and          canal vessels)), 7 (goods in transit), 11 (aircraft
  15 (suretyship).                                                 liability), 12 (liability for ships (sea, lake and river
                                                                   and canal vessels)), 14 (credit) and 15 (suretyship).
                            Article 2                                                        Article 2
  1.     Every insurance contract shall give rise to the           1.     Every insurance contract shall give rise to the
 issue to the policyholder of a document containing at            issue to the policyholder of a document containing at
  least the following information:                                least the following information:
 (a) the name and address or head office of the                   (a) the name and address of the policyholder; name
      contracting parties;                                             and registered office of the insurer or co-insurers;
                                                                       address of the establishment to which the
                                                                       policyholder is to send his declarations and pay
                                                                       the premiums;
 (b) the subject matter of the insurance                and   a  (b) the subject matter of the insurance, any exclusions
      description of the risks covered;                                and a description of the risks covered;
 (c) the amount insured or the method of calculating              (c) the amount insured or the method of calculating
      it;                                                              it;
(d) the amount of the premium or contribution or the              (d) the amount of the premium or contribution or the
      method of calculating it;                                        method of calculating it;
(e) the dates on which premiums or contributions fall            (e) the dates on which premiums or contributions fall
      due;                                                             due;
(f) the duration of the contract and the times at                (f) the duration of the contract and the times at
      which cover commences and expires and, where it                  which cover commences and expires and, where it
      applies, the time of automatic renewal.                          applies, the time of automatic renewal.
2.      Pending the issue of such a document the                 2.      Pending the issue of such a document the
policyholder shall be entitled to receive, at the earliest       policyholder shall be entitled to receive, without
opportunity, a document which attests to the                     delay, a document which attests to the existence of an
existence of an insurance contract and contains at               insurance contract and contains at least the infor-
least the information referred to in paragraph 1 (1),            mation referred to in paragraph 1 (a), (b) and (c).
(b) and (c).
3.     If, after the contract has been concluded any             3.      If, after the contract has been concluded, any
change occurs that affects the information referred to           agreed change occurs that affects the information
under paragraph 1 (a) to (f), the insurer shall furnish          referred to under paragraph 1 (a) to (f), the insurer
the policyholder with a document notifying such                  shall furnish the policyholder with a document
change                                                           containing information as to such change.
4.      If provisional cover is provided the policyholder        4.     If provisional cover is provided, the policy-
shall receive a document which certifies that such               holder shall be entitled to receive a document which
cover has in fact been provided and which contains at            contains the information that such cover has in fact
least the information referred to in paragraph 1 (a),            been provided and which contains at least the infor-
(b), (c) and (f).                                                mation referred to in paragraph 1 (a), (b), (c) and (f).
(') OJ No L 228, 16. 8. 1973, p. 3.                              (') OJ No L 228, 16. 8. 1973, p. 3.
 ---pagebreak---  31.12.80                         Official-Journal of the European Communities                            No C 355/33
                     INITIAL PROPOSAL                                                 NEW PROPOSAL
5.     The contract shall be drafted in the language of       5.     The documents referred to in paragraphs 1, 2, 3
the Member State whose law is applicable.                     and 4 shall be drafted in the language of the Member
                                                              State whose law is applicable according to the second
                                                              Council Directive . . . / . . ./EEC of
However, the policyholder shall be entitled to                However, the policyholder shall be entitled to
stipulate as a condition precedent to the conclusion of       stipulate as a condition precedent to the conclusion of
the contract that all documents relating to the               the contract that all documents relating to the
conclusion, amendment and performance of the                  conclusion, amendment and performance of the
insurance contract be translated into the language of         insurance contract be drafted in the language of his
his habitual residence, provided such language is an          habitual residence, provided such language is an
official language of the Community.                           official language of the Community.
6.     The documents referred to in           the  above      6.     The documents referred to in the            above
paragraphs have only a probative value.                       paragraphs shall have only a probative value.
7.     Notwithstanding the provisions of this Article,        7.     Notwithstanding the provisions of this Article,
the laws of the Member States may authorize a                 the laws of the Member States may authorize a
simplified form for insurance contracts concluded for         simplified form for insurance contracts concluded for
a short period and for bearer policies.                       a period of less than six months and for bearer
                                                              policies.
                         Article 3                                                        Article 3
1.     When concluding the contract, the policyholder          1.    When concluding the contract, the policyholder
shall declare to the insurer any circumstances of             shall declare to the insurer any circumstances of
which he is aware which may influence the insurer's           which he ought reasonably to be aware and which he
assessment or acceptance of the risk. The                     ought to expect to influence a prudent insurer's
policyholder shall not be obliged to declare to the           assessment or acceptance of the risk. The
insurer circumstances which are already known to the          policyholder shall not be obliged to declare to the
latter or which are common knowledge. Any                     insurer circumstances of which the latter is already
circumstance in respect of which the insurer has              aware because he has already covered the risk. In the
asked specific questions in writing shall, in the             case of a corporate policyholder, circumstances of
absence of proof the contrary, be regarded as                 which it ought reasonably to be aware means circum-
influencing the assessment and acceptance of the risk.        stances of which the appropriate officer of the cor-
                                                              poration ought reasonably to have been aware. Any
                                                              circumstances in respect of which the insurer has
                                                              asked specific questions in writing shall, in the
                                                              absence of proof to the contrary, be regarded as
                                                              influencing the assessment and acceptance of the risk.
2. (a) If circumstances which were unknown to both                (a) If circumstances existing at the time of
       parties when the contract was concluded come                    entering into the contract which were
       to light subsequently, or if the policyholder has               unknown to both parties when the contract
       failed to fulfil the obligation referred to in                  was concluded come to light subsequently, or
       paragraph 1, the insurer shall be entitled, within              if the policyholder has failed to declare
       a period of two months from the date on which                   circumstances of which he was aware but which
       he becomes aware of the fact, to propose an                     he did not expect to influence a prudent
       amendment to the contract.                                      insurer's assessment of the risk, the insurer or
                                                                       the policyholder shall be entitled, within a
                                                                       period of two months from the date on which
                                                                       he becomes aware of the fact, to propose an
                                                                       amendment to or termination of the contract.
 ---pagebreak---  No C 355/34                            Official Journal of the European Communities                           31. 12. 80
                        INITIAL PROPOSAL                                               NEW PROPOSAL
    (b) 1.      The policyholder shall be entitled to a                Where one of the parties proposes an
          period of fifteen days from the date on which                amendment to the contract, the insurer shall be
          he receives the proposal for an amendment in                 entitled to a period of fifteen days and the
          which to accept or reject it. If the policyholder            policyholder to a period of one month from the
          rejects the proposal or fails to reply within the            date of receipt of the proposal in which to
          above time limit, the insurer may terminate the              accept or reject it. In the event of rejection of
          contract within a period of eight days by                    the proposal or failure to reply within the
          giving fifteen days' notice.                                 above time limit, the party proposing the
                                                                       amendment may terminate the contract within
                                                                       a period of eight days.
                                                                       Termination shall not take effect until a period
                                                                       of fifteen days has elapsed from the date on
                                                                       which notice of termination is given, as the case
                                                                       may be, to the insurer or to the policyholder at
                                                                       his last known address.
                                                                       The abovementioned periods shall be extended
                                                                       to three weeks and one month where they are
                                                                       to the policyholder's benefit and the contract
                                                                       covers a risk which is not connected with a
                                                                       commercial or industrial activity of the
                                                                       policyholder.
                                                                       Where one of the parties proposes that the
                                                                       contract be terminated, termination shall not
                                                                       take effect until a period of fifteen days has
                                                                       elapsed from the date on which notice of termi-
                                                                       nation is given to the insurer or to the
                                                                       policyholder at his last known address.
                                                                       The abovementioned period shall be extended
                                                                       to one month where the insurer terminates the
                                                                       contract and the contract covers a risk which is
                                                                       not connected with a commercial or industrial
                                                                       activity of the policyholder.
         2.     If the contract is terminated, the insurer         (b) If the contract is terminated, the insurer shall
         shall refund to the policyholder the proportion               refund to the policyholder the proportion of
         of the premium in respect of the period for                   the premium in respect of the period for which
         which cover is not provided.                                  cover is not provided.
         3.     If a claim arises before the contract is           (c) If a claim arises before the contract is
         amended or before termination of the contract                 amended or before termination of the contract
         has taken effect, the insurer shall provide the               has taken effect, the insurer shall provide the
         agreed cover.                                                 agreed cover.
3.     If the policyholder has failed to fulfil the             3. (a) If the policyholder has failed to fulfil the
obligation referred to in paragraph 1 and may be                       obligation referred to in paragraph 1, (eight
considered to have acted improperly, the insurer may                   words deleted) the insurer may, within two
terminate the contract or propose an amendment to                      months from the date on which he becomes
it.                                                                    aware of such fact, propose an amendment to
                                                                       the contract or terminate it.
(a) The insurer shall choose either to terminate the
     contract or to propose an amendment to it within                  Where      the    insurer   has proposed       an
     two months from the date on which he becomes                      amendment to the contract, the policyholder
     aware of such facts. Termination shall take effect                shall be entitled to accept or reject it within
     fifteen days after the date on which the                          one month from the date on which he receives'
     policyholder is notified thereof at his last known                the proposal for an amendment. If the
     address. If the insurer has proposed an                           policyholder refuses the proposal or fails to
 ---pagebreak--- 31. 12.80                        Official Journal of the European Communities                             No C 355/35
                     INITIAL PROPOSAL                                               NEW PROPOSAL
    amendment to the contract, the policyholder shall                reply, the insurer may terminate the contract
    be entitled to accept or reject it within fifteen                within eight days. Termination shall not take
    days from the date on which he receives the                      effect until a period of fifteen days has elapsed
    proposal for an amendment. If the policyholder                   from the date on which the policyholder is
     refuses the proposal or fails to reply, the insurer             notified thereof at his last known address.
     may terminate the contract within eight days by
    giving fifteen days' notice.                                     Where the insurer terminates the contract,
                                                                     termination shall take effect fifteen days after
                                                                     the date on which the policyholder is notified
                                                                     thereof at his last known address.
(b) If the contract is terminated, the insurer shall            (b) If the contract is terminated, the insurer shall
    refund to the policyholder the proportion of the                 refund to the policyholder the proportion of
    premium in respect of the period for which cover                 the premium in* respect of the period for which
    is not provided*                                                 cover is not provided.
(c) If a claim arises before the contract is amended or         (c) If a claim arises before the contract is
    before termination of the contract has taken                     amended or before termination of the contract
    effect, the insurer shall be liable to provide only              has taken effect, the insurer shall pay the
    such cover as is in accordance with the ratio                    policyholder a proportion of the compensation
    between the premium paid and the premium that                    which would have been payable had the
    the policyholder should have paid if he had                      policyholder not failed to fulfil his obligations
    declared the risk correctly.                                     under paragraph 1 equal to the ratio between
                                                                     the agreed premium and the premium which a
                                                                     prudent insurer would have fixed if the
                                                                     policyholder had fulfilled his obligations under
                                                                     paragraph 1. However, if the insurer can show
                                                                     that no prudent insurer would have accepted
                                                                     the risk regardless of the rate of premium if he
                                                                     had been aware of the circumstances which the
                                                                      policyholder should have disclosed, or if the
                                                                      insurer can show that a prudent insurer would
                                                                      not have accepted the risk unless certain
                                                                      conditions were complied with, he shall not be
                                                                      bound to pay any claim.
4.    If the policyholder has failed to fulfil the           4. (a) If the policyholder has failed to fulfil the
obligation referred to in paragraph 1 with the                        obligation referred to in paragraph 1 with the
intention of deceiving the insurer, the latter may                    intention of deceiving the insurer, the latter
terminate the contract.                                               may terminate the contract (six words deleted)
                                                                      within two months from the date on which he
(a) The insurer shall take such action within two
                                                                      becomes aware of such fact.
     months from the date on which he becomes
     aware of such facts.
(b) By way of damages, premiums paid shall be                    (b) By way of damages, premiums paid shall be
    retained by the insurer who shall be entitled to                  retained by the insurer who shall be entitled to
    the payment of all premiums due.                                  the payment of all premiums due, without
                                                                      prejudice to the payment of damages in respect
                                                                      of any additional losses he has incurred by
                                                                      reason of the intention to deceive.
(c) The insurer shall not be liable in respect of any            (c) The insurer shall not be liable in respect of any
    claim.                                                            claim.
5.     In the cases referred to in paragraphs 3 and 4,       5.     In the cases referred to in paragraphs 3 and 4,
the burden of proof of fraudulent or improper                the burden of proof of failure to fulfil the obligation
conduct on the part of the policyholder shall rest on        referred to in paragraph 1 or of intention to deceive
the insurer.                                                 on the part of the policyholder shall rest on the
 ---pagebreak---  No C 355/36                           Official Journal of the European Communities                              31.12.80
                       INITIAL PROPOSAL                                                NEW PROPOSAL
                           Article 4                                                     Article 4
                                                                1.    unchanged.
 2.      The insurer may, within two months of the date        2.     The insurer may, within two months of the date
 on which he was notified of the increase of the risk,         on which he became aware of the increase of risk,
 propose an amendment to the contract in accordance            propose an amendment to or terminate the contract
 with the procedure laid down in Article 3 (2) (b).            in accordance with the provisions covering such
                                                               circumstances set out in Article 3 (2).
 3.      If the policyholder has failed to fulfil the          3.     If the policyholder has failed to fulfil the
 obligation referred to in paragraph 1, such failure to        obligation referred to in paragraph 1, such failure to
 give notice shall not give rise to any sanction where it      give notice shall not give rise to any sanction where it
 relates to a new circumstance or change in circum-            relates to a new circumstance which is (one word
 stances which is not liable to appreciably and                deleted) liable neither to increase the risk appreciably
 permanently increase the risk and lead to an increase         or permanently nor lead to an increase in the
 in the premium.                                               premium.
 4.     If the policyholder has failed to fulfil the           4.     If the policyholder has failed to fulfil the
obligation referred to in paragraph 1, the insurer             obligation referred to in paragraph 1, the insurer
 may, within two months of the date on which he                may, within two months of the date on which he
becomes aware of such fact, propose an amendment               becomes aware of such fact, propose an amendment
to the contract in accordance with the procedure laid          to the contract or terminate it in the manner provided
down in Article 3 (2) (b).                                     for in Article 3 (3). However, in respect of the
                                                               application of the proportionality provided for in
                                                               Article 3 (3) (c) account shall be taken only of the
                                                               portion of premium corresponding to the period sub-
                                                               sequent to the increase.
 5.     If the policyholder has failed to fulfil the           (deleted)
obligation referred to in paragraph 1 and may be
considered to have acted improperly, Article 3 (3)
shall apply.
6.      If the policyholder has failed to fulfil the           5. (a) If the policyholder has failed to fulfil the
obligation referred to in paragraph 1 with the                          obligation referred to in paragraph 1, with the
 intention of deceiving the insurer, the latter may                     intention of deceiving the insurer, the latter
terminate the contract.                                                 may terminate the contract (six words deleted)
                                                                        within two months from the date on which he
 (a) The insurer shall take such action within two                      becomes aware of such fact.
      months from the date on which he becomes
     .aware of such fact;
 (b) By way of damages, any premiums paid shall be                 (b) By way of damages, any premiums paid shall
      retained by the insurer who shall be entitled to                  be retained by the insurer who shall be entitled
      the payment of all premiums due.                                  to the payment of all premiums due without
                                                                        prejudice to the payment of damages in respect
                                                                        of any additional losses he has incurred by
                                                                        reason of the intention to deceive.
(c) The insurer shall not be liable in respect of any              (c) The insurer shall not be liable in respect of any
      claim arising after the increase of the risk.                     claim arising after the increase of the risk.
7.      In the case referred to in paragraphs 5 and 6,         6.     In the cases referred to in paragraphs 4 and 5,
the burden of proof of fraudulent or improper con-             the burden of proof of failure to fulfil the obligation
duct on the part of the policyholder shall rest on the         referred to in paragraph 1 or of intention to deceive
 ---pagebreak--- 31. 12. 80                          Official Journal of the European Communities                           N o C 355/37
                       INITIAL PROPOSAL                                               NEW PROPOSAL .
                                                                on the part of the policyholder shall rest on the
                                                                insurer.
                                                                 7.    The provisions of this Article shall not apply to
                                                                circumstances which form the subject of an express
                                                                exclusion of cover in the contract.
                           Article 5                            (Article 5 becomes Article 9).
Any unjustified payment made pursuant to Articles 3
and 4 shall be refunded.
                           Article 6                                                     Article 5
If, while the contract is in force, the risk has dimini-        If, while the contract is in force, the risk has
shed appreciably and permanently because of circum-             diminished appreciably and permanently because of
stances other than those covered by the contract, and           circumstances other than those covered by the
if this justifies a reduction in the premium, the policy-       contract (nine words deleted) the policyholder may
holder shall be entitled to terminate the contract              ask for the premium to be reduced. The policyholder
without compensation if the insurer does not consent            shall be entitled to terminate the contract without
to reduce the premium proportionately.                          compensation if the insurer does not consent to
                                                                reduce the premium proportionately.
The right to terminate the contract shall arise imme-           The right to terminate the contract shall arise
diately the insurer refuses to reduce the premium or,           immediately the insurer refuses to reduce the
where he fails to reply to the policyholder's proposal,         premium or, where he fails to reply to the
after a period of 15 days following such proposal.              policyholder's proposal, after a period of fifteen days
                                                                following such proposal.
Where the contract is terminated, the insurer shall re-         Where the contract is terminated, the insurer shall
fund to the policyholder a proportion of the premium            refund to the policyholder a proportion of the
corresponding to the period for which cover is not              premium corresponding to the period for which cover
provided, less the administrative costs involved.               is not provided, less the administrative costs involved.
                                                                                        Article 6
                                                                (Old Article 7 unchanged).
                           Article 8                                                    Article 7
                                                                1.    (Old Article 8 (a) unchanged).
2.     Any costs incurred by the policyholder in per-           2.    Any costs incurred by the policyholder in per-
forming the obligation referred to in paragraph 1               forming the obligation referred to in paragraph 1
shall be borne by the insurer.                                  shall be borne by the insurer.
                                                                Notwithstanding this, where the policyholder carries
                                                                on a commercial or industrial activity and the contract
                                                                covers a risk connected with such activity, they shall
                                                                be defrayed only in so far as, when combined with the
                                                                amount of damage suffered, they do not exceed the
                                                                sum insured.
 ---pagebreak--- No C 355/38                           Official Journal of the European Communities                            31.12.80
                      INITIAL PROPOSAL                                                NEW PROPOSAL
                                                              Paragraphs 3, 4 and 5 unchanged.
                          Article 9                                                     Article 8
1.     If a claim arises, the policyholder shall declare it    1.    If a claim arises or if an event occurs which may
to the insurer in accordance with the conditions and          result in a claim arising, the policyholder shall declare
time limits laid down in the policy.                          it to the insurer in accordance with the conditions
                                                              and time limits laid down in the policy. The time limit
The time limit must be reasonable. Such time limit
                                                              must be reasonable. Such time limit may be fixed by
may be fixed by national laws for certain classes of
                                                              national laws for certain classes of insurance.
insurance.
                                                              Paragraphs 2, 3 and 4 unchanged.
                           Article 5                                                    Article 9
Any unjustified payment made pursuant to Articles 3           Any unjustified payment made by the parties pursuant
and 4 shall be refunded.                                       to the foregoing Articles shall be refunded.
                          Article 10                                                   Article 10
 1.    The circumstances and conditions in which the           1.    The circumstances and conditions in which the
contract may be denounced or terminated shall be set           contract may be denounced or terminated shall be set
out in the contract either directly or by reference to         out in the contract either directly or by reference to
the law.                                                       the law applicable to the contract.
                                                               2.     (unchanged).
3.     Without prejudice to the circumstances referred         3.    Without prejudice to the circumstances referred
 to in paragraph 2:                                           to in paragraph 2:
 (a) premature termination on the part of the                  (a) Save where the parties have agreed to a shorter
      policyholder or the insurer shall not take effect            period in the case of wax, insurrection or civil war,
      until a period of 15 days has elapsed from the               premature termination on the part of the
      date on which notice of termination is given, as             policyholder or the insurer shall not take effect
      the case may be, to the insurer or to the                    until a period of fifteen days has elapsed from the
     policyholder at his last known address;                       date on which notice of termination is given, as
                                                                   the case may be, to the insurer or to the
                                                                   policyholder at his last known address.
                                                              (b) unchanged.
 (c) if the contract is for a period of more than three        (c) If the contract is for a period of more than three
     years, the policyholder may terminate it at the               years, the policyholder may terminate it at the
     end of the third year or of any subsequent year               end of the third year or of any subsequent year
     by giving at least two months' notice;                        by giving at least two months' notice, provided
                                                                    that the premiums were not agreed for a fixed
                                                                    period.
(d) as regards sickness insurance and contracts drawn          (d) deleted.
     up on the same basis as life assurance contracts,
     national law may, by way of derogation from
 ---pagebreak--- 31. 12.80                        Official Journal of the European Communities                                No C 355/39
                     INITIAL PROPOSAL                                                   NEW PROPOSAL
    subparagraphs (a) and (b), limit or prohibit termi-
    nation of the contract by the insurer.
                                                                                     Ankles 11 and 12
                                                                 (unchanged).
                        Article 13                                                        Article 13
Member States shall bring into force the measures                Member States shall bring iruo force the measures,
necessary to comply with this Directive within 18                necessary to comply with this Directive before 1 July
months of its notification. They shall forthwith                  1983. They shall inform the Commission thereof
inform the Commission thereof.                                    immediately.
                                                                                      Articles 14 and 15
                                                                  (unchanged).
              Proposal for a Council Directive coordinating the requirements for the drawing up,
             scrutiny and distribution of the prospectus to be published when securities are offered for
                                             subscription or sale to the public
                            (Submitted to the Council by the Commission on 13 January 1981)
THE COUNCIL OF THE EUROPEAN                                       securities promotes the protection of investors by
COMMUNITIES,                                                      allowing the latter to evaluate the risks undertaken
                                                                  and to take decisions on their own responsibility;
Having regard to the Treaty establishing the
European Economic Community, and in particular                   Whereas, moreover, such information represents an
Articles 54 (3) (g) and 100 thereof,                              effective means of reinforcing confidence in securities
                                                                  and thus contributes to the correct functioning of
Having regard to the proposal from the Commission,                securities markets and to encouraging their
                                                                  development;
Having regard to the opinion of the European Par-
liament,                                                          Whereas it is accordingly appropriate to establish an
                                                                  information     policy relating      to   securities at
Having regard to the opinion of the Economic and                  Community level, and whereas such an information
Social Committee,                                                 policy, by virtue of the safeguards that it provides to
                                                                  investors and its impact on the correct functioning of
Whereas investment in securities, like any other form             securities markets, is of such a nature as to promote
of investment, involves risks, and the protection of              the interpenetration of national securities markets and
investors requires that they be put in a position to              thus to contribute to the creation of a genuine
make a correct assessment of such risks so as to be                European capital market;
able to take investment decisions in full knowledge of
the facts;                                                        Whereas the Council Directive 80/390/EEC of 17
                                                                  March 1980 coordinating the requirements for the
Whereas the provision of adequate and complete                    drawing up, scrutiny and distribution of the listing
information concerning securities and the issuers of              particulars to be published for the admission of