GIM10040 - Non-resident insurers: regulatory background: EEA insurers: “Treaty firms” with a branch or providing services in the UK

A Treaty firm does not have to seek permission from the FSA under Part 4 FSMA 2000 provided it has “Treaty rights” under Schedule 4 to the Act. This applies to a company effecting or carrying out contracts of general insurance which

• does not have its head office in the UK and
• has received authorisation under Article 6 of the First Non-Life Insurance Directive from its home state regulator in another EEA state
• but which intends to carry on only reinsurance business in the UK through a branch.

These too are “EEA Insurers” for the purposes of FSMA, but this is likely to apply to a very limited number of companies. If such a case arises, the FSA receives notice from the EEA home state regulator that it has given consent to the EEA firm to establish a branch or provide services in the UK, in respect of permitted activities and in accordance with the insurance directives.

A pure reinsurer with its head office in another EEA state is not an EEA insurer for the purposes of this part of the Chapter. This is because the EC Insurance Directives do not apply to reinsurance. A small mutual whose receipts are below the level set out in the Directives (a “non- directive insurer”) is also outside the scope of the Passport rights. Both types of company are non-EEA insurers for the purpose of both FSMA and this Chapter.