- In accordance with Article 9(5) of Regulation (EU) No 1094/2010, EIOPA may, where the conditions in paragraphs 2 and 3 of this Article are fulfilled, temporarily prohibit or restrict in the Union:
- the marketing, distribution or sale of certain insurance-based investment products or insurance-based investment products with certain specified features; or
- a type of financial activity or practice of an insurance or reinsurance undertaking.
A prohibition or restriction may apply in circumstances, or be subject to exceptions, specified by EIOPA.
- EIOPA shall take a decision under paragraph 1 only if all of the following conditions are fulfilled:
- the proposed action addresses a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or to the stability of the whole or part of the financial system in the Union;
- regulatory requirements under Union law that are applicable to the relevant insurance-based investment product or activity do not address the threat;
- a competent authority or competent authorities have not taken action to address the threat or the actions that have been taken do not adequately address the threat.
Where the conditions set out in the first subparagraph are fulfilled, EIOPA may impose the prohibition or restriction referred to in paragraph 1 on a precautionary basis before an insurance-based investment product has been marketed or sold to investors.
- When taking action under this Article, EIOPA shall ensure that the action does not:
- have a detrimental effect on the efficiency of financial markets or on investors that is disproportionate to the benefits of the action; or
- create a risk of regulatory arbitrage.
Where a competent authority or competent authorities have taken a measure under Article 17, EIOPA may take any of the measures referred to in paragraph 1 of this Article without issuing the opinion provided for in Article 18.
- Before deciding to take any action under this Article, EIOPA shall notify competent authorities of the action it proposes.
- EIOPA shall publish on its website notice of any decision to take any action under this Article. The notice shall specify details of the prohibition or restriction and specify a time after the publication of the notice from which the measures will take effect. A prohibition or restriction shall only apply to action taken after the measures take effect.
- EIOPA shall review a prohibition or restriction imposed under paragraph 1 at appropriate intervals and at least every three months. If the prohibition or restriction is not renewed after that three-month period it shall expire.
- Action adopted by EIOPA under this Article shall prevail over any previous action taken by a competent authority.
- The Commission shall adopt delegated acts in accordance with Article 30 specifying criteria and factors to be taken into account by EIOPA in determining when there is a significant investor protection concern or a threat to the orderly functioning and integrity of financial markets or to the stability of the whole or part of the financial system of the Union referred to in point (a) of the first subparagraph of paragraph 2.
Those criteria and factors shall include:
- the degree of complexity of the insurance-based investment product and the relation to the type of investor to whom it is marketed and sold;
- the size or the notional value of the insurance-based investment product;
- the degree of innovation of the insurance-based investment product, activity or a practice; and
- the leverage a product or practice provides.