Freedom of establishment on the internal insurance market of the European Union in the light of directive 2009/138/EC (Solvency II)

Wioleta Baranowska-Zając


The cross-border business of insurance could be undertaken and carried out on the basis of two freedoms of the internal market – freedom of establishment and freedom to provide services. To use these two freedoms by insurance undertakings applied also, as well as the insurance directives of the European Union, that were previously in force, the directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of insurance and reinsurance (the Solvency II directive; OJ L 335, 17.12.2009, p. 1). The use of freedom of establishment on the insurance market could rely, in particular, on the establishment of a branch or a subsidiary of the insurance undertaking in the member state other than home member state of an undertaking, on the basis of the single license obtained in home member state. The aim of the study is, first of all, an indication of uncertainties and interpretational doubts, which may affect the use of freedom of establishment in the internal market by insurance undertakings and, secondly, to show the amendments that have occurred in the field of regulation of cross-border establishing branches and subsidiaries by insurance undertakings on the basis of directive 2009/138/EC in comparison with similar provisions contained in first-generation and third-generation insurance directives. The scientific method that has been applied is based on the logical-language analysis of the legal text of directive 2009/138/EC in the field relating to freedom of establishment and on the comparative analysis of these provisions and the relevant provisions of first-generation and third-generation insurance directives. The results of the study lead, firstly, to a conclusion that the cross-border branch establishment by an insurance undertaking is not free in the strict sense. The directive 2009/138/EC in this respect imposes numerous obligations on insurance undertakings. Secondly, through Solvency II directive there has been followed amendments of legal solutions little in terms of editorial, though significant from the semantic point of view. The analysis has also led to put numerous questions reflecting the interpretational doubts. The result of the attempt to answer these questions has become the formulation of de lege ferenda demands aimed to eliminate the interpretational doubts and to improve the functioning of provisions concerning the insurance market as a part of the internal market of the European Union.

DOI: 10.5901/mjss.2014.v5n19p661

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