Local view for "http://purl.org/linkedpolitics/eu/plenary/2007-06-19-Speech-2-028"
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"en.20070619.5.2-028"2
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".
Mr President, Commissioner, ladies and gentlemen, I, too want to extend particular thanks to the rapporteur, without whom this House would not have a comprehensive and precise inquiry report into the Equitable Life affair to take note of or be able to draw unambiguous and clear conclusions from it. It gives the 1.5 million insurance customers in the United Kingdom and in other European states new hope of financial compensation for the losses they have sustained. The conclusion is beyond doubt: it is that the United Kingdom was negligent in transposing the EU’s insurance directive, which applies in cases such as this, but the report goes on to criticise not only the structural deficiencies of Europe’s system of supervision and regulation, but also the German supervisory authorities’ failure to do enough to protect the interests of Germans who had insurance policies with Equitable Life.
Investors outside the UK in particular found themselves, when seeking legal remedies and demanding compensation, caught up in a veritable game of ping-pong between the authorities in the respective countries, none of which saw themselves as having responsibility for the matter. There were considerable problems – and not only in the United Kingdom – where financial supervision and the regulatory framework were concerned, and what is even more serious is that there were undoubted defects in the system for supervision and financial control, not to mention shocking problems in communication between the national supervisory authorities. This will have repercussions right across Europe, since the Equitable Life was able to offer its services in other EU Member States under the third life assurance directive, which was itself founded on the country of origin principle, of which we Greens have taken a critical view. That principle provides that a company’s financial health and the adequacy of its reserves should be monitored only by the authorities in the country in which that company’s registered office is situated.
The Equitable Life case is a textbook example how, if one takes out a policy with an insurance company whose registered office is in another European Member State, loopholes can occur as regards legal safeguards and financial supervision. It is not acceptable that consumers should have to suffer legal uncertainty of this kind in as sensitive an area as the cross-border market in financial services, which is constantly growing, and so I am glad that the committee of inquiry is making the specific demand for legislation to emerge from the work currently in progress, as part of the Solvency II project, on future equity capital requirements for insurers.
It also calls on the Commission to submit before the end of the year the planned legislative proposal on the introduction of guarantee funds for insurers in order to impose Europe-wide and binding requirements in respect of financial services, the creation of reserves for liabilities and guarantee schemes for domestic and foreign customers."@en1
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