Background
The Financial Services Authority (FSA) published two series of consultations on rules to transpose the Solvency II Directive into the Prudential Regulation Authority (PRA) Handbook. The PRA has adopted both Consultation Papers. This programme ran alongside the Treasury’s consultation, conducted over the same period, to implement the Directive.
In November 2011, the FSA published a Consultation Paper (CP) entitled 'Transposition of Solvency II - Part 1'. The paper proposed draft rules on pillar 1 (capital) and pillar 2 (governance) issues of the EU Solvency II directive (2009/138/EC) as well as seeking stakeholder feedback on a number of areas where the UK can exercise options or discretions. The CP also contained a cost-benefit analysis of implementing the directive in the UK.
The deadline for responses closed on 15 February 2012.
FSA Consultation Paper 11/22
In July 2012, the FSA published ‘Transposition of Solvency II – Part 2’, which set out proposed rules and guidance on areas that were not covered, or were only partially covered, in ‘Transposition of Solvency II – Part 1’. ‘Transposition of Solvency II – Part 2’ includes how the rules may apply to the Lloyd’s insurance market and our policy for separate disclosure of capital add-ons, together with proposed changes to existing Handbook rules governing with-profits and unit linked business.
FSA Consultation Paper 12/13
Response
The deadline for responses closed on 11 October 2012 and a Policy Statement containing final rules in respect of both Solvency II CPs is expected to be issued in summer 2013.