The Insurance Distribution Directive (IDD) permits each Member State to develop general good rules (i.e. national rules), including those on registration and professional and organisational requirements. Member States can then use these rules to impose local market-specific requirements on insurance and reinsurance distributors that passport into host Member States on a freedom of establishment (FoE) or freedom of services (FoS) basis, in addition to the obligations imposed on them under IDD.
The European Insurance and Occupational Pensions Authority (EIOPA) undertook a review of the published general good rules of each Member State on registration and professional and organisational requirements to determine if they have the potential to be non-compliant with IDD (Review).
The Review was a follow-up to EIOPA's "Report analysing national general good rules" regarding the proper functioning of the IDD and the internal market in July 2019 (Report). The Report found that National Competent Authorities (NCAs) had published general good rules on registration and organisational requirements. These rules allow NCAs as host Member States to impose additional requirements on passporting insurance and reinsurance distributors. IDD requires the competent authority of the home Member State of the insurance and reinsurance distributor to retain the sole competence to impose such rules.
EIOPA has stated that the Review has enhanced "transparency for consumers and is reducing the barriers to the taking-up and pursuit of the activity of insurance distribution on a cross-border basis in the internal market".
Many NCAs have adopted actions to ensure compliance with the IDD. Measures adopted by NCAs include adjusting their web pages and documents with information on general good rules.
Irish Specific Changes Following the Review
Following EIOPA's intervention, the Central Bank of Ireland (CBI) removed the reference to Part 3 of the Central Bank Reform Act 2010. This provision gave the CBI, as a host NCA, the power to conduct an investigation into the fitness and probity of a controlled function performed by a passporting (re)insurance intermediary/undertaking and suspend, remove or prohibit individuals from controlled functions.
The CBI has included the CBI's power to investigate (re)insurance distributors passporting into Ireland on a FoE or FoS basis under IDD or Solvency II on the Enforcement part of the CBI's website section on Regulation.
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