Section 51 Approval of transfers of general business.F1
United Kingdom
Where it is proposed to execute an instrument by which an insurance company to which this Part of this Act applies (“the transferor”) is to transfer to another body (“the transferee") all its rights and obligations under such general policies, or general policies of such descriptions, as may be specified in the instrument, the transferor may apply to the Secretary of State for his approval of the transfer.
The Secretary of State shall not determine an application made under subsection (1) above unless he is satisfied that—
a notice approved by him for the purpose has been published in the London, Edinburgh and Belfast Gazettes and, if he thinks fit, in two national newspapers which have been so approved; and
except in so far as he has otherwise directed, a copy of the notice has been sent to every affected policy holder and every other person who claims an interest in a policy included in the transfer and has given written notice of his claim to the transferor; and
copies of a statement setting out particulars of the transfer and approved by him for the purpose have been available for inspection at one or more places in the United Kingdom for a period of not less than thirty days beginning with the date of the first publication of the notice in accordance with paragraph (a) above.
The notice referred to in subsection (2) above shall include a statement that written representations concerning the transfer may be sent to the Secretary of State before a specified day, which shall not be earlier than sixty days after the day of the first publication of the notice in accordance with paragraph (a) above; and the Secretary of State shall not determine the application until after considering any representations made to him before the specified day.
The Secretary of State shall not approve a transfer on an application under subsection (1) above unless he is satisfied that—
every policy included in the transfer evidences a contract which—
was entered into before the date of the application; and
imposes on the insurer obligations the performance of which will constitute the carrying on of insurance business in the United Kingdom; and
the transferee is, or immediately after the approval will be, authorised under section 3 or 4 above to carry on in the United Kingdom insurance business of the appropriate class or classes;
and unless in his opinion the transferee’s financial resources and the other circumstances of the case justify the giving of his approval.
Without prejudice to the generality of subsection (4) above, the Secretary of State shall not approve a transfer on an application under subsection (1) above to an insurance company whose head office is situated in another member State F3or to a Swiss general insurance companyF4unless—
the supervisory authorities of that State or, as the case may be, of Switzerland certify that it possesses the necessary margin of solvency after taking the proposed transfer into account; or
every policy included in the proposed transfer evidences a contract of reinsurance.
Notwithstanding the provisions of subsection (4)(a)(ii) and (b) above, the Secretary of State may approve a transfer on an application under subsection (1) above to an insurance company established in another member State, where he is satisfied that–
the transfer relates to policies covering risks situated in the United Kingdom,
the transferee is entitled in accordance with section 81B below to provide insurance in the United Kingdom in respect of those risks through that establishment, and
the supervisory authorities of the member State of that establishment agree to the transfer.
On determining an application made under subsection (1) above, the Secretary of State shall—
publish a notice of his decision in the London, Edinburgh and Belfast Gazettes and in such other manner as he may think fit, and
send a copy of that notice to the transferor, the transferee and every person who made representations in accordance with the notice referred to in subsection (2) above;
and if he refuses the application he shall inform the transferor and the transferee in writing of the reasons for his refusal.
Any notice or other document authorised or required to be given or served under this section or section 52 below may, without prejudice to any other method of service, be served by post; and a letter containing the notice or other document shall be deemed to be properly addressed if it is addressed to that person at his last known residence or last known place of business in the United Kingdom.
In this section “general policy” means a policy evidencing a contract the effecting of which constituted the carrying on of general business; and for the purposes of this section a policy holder is an “affected policy holder” in relation to a proposed transfer if—
his policy is included in the transfer, or
his policy is with the transferor and the Secretary of State has certified, after consulting the transferor, that in the opinion of the Secretary of State the policy holder’s rights and obligations under the policy will or may be materially affected by the transfer.
Annotations
Textual amendments
- F1
S. 49 substituted for ss. 49-52 (1.7.1994) by S.I. 1994/1696, reg. 28(1)(3)
- F2
S. 51(4A)(4B) inserted by S.I. 1990/1333, reg. 9(1)
- F3
Words in s. 51(4A) inserted (5.1.1994) by S.I. 1993/3127, reg. 3(8)
- F4
Words in s. 51(4A) substituted (19.11.1992) by S.I. 1992/2890, reg. 3
Notes on the whole Act
Textual amendments
- F1
Act repealed (1.12.2001) by The Financial Services and Markets Act 2000 (Consequential Amendments and Repeals) Order 2001 (S.I. 2001/3649), arts. 1, 3(1)(b)
Notes on Part II
Modifications
- C1
Pt. II (ss. 15-71) restricted (1.1.1993) by S.I. 1992/3218, reg65
Pt. II (ss. 15-71) extended (24.12.1996) by S.I. 1996/3011, reg. 3(1)(b), 10(1)