- A competent authority may prohibit or restrict the following in or from its Member State:
- A competent authority may take the action referred to in paragraph 1 if it is satisfied on reasonable grounds that:
- an insurance-based investment product, or activity or practice gives rise to significant investor protection concerns or poses a threat to the orderly functioning and integrity of financial markets or the stability of whole or part of the financial system within at least one Member State;
- existing regulatory requirements under Union law applicable to the insurance-based investment product, or activity or practice do not sufficiently address the risks referred to in point (a) and the issue would not be better addressed by improved supervision or enforcement of existing requirements;
- the action is proportionate taking into account the nature of the risks identified, the level of sophistication of investors or market participants concerned and the likely effect of the action on investors and market participants who may hold, use or benefit from the insurance-based investment product, or activity or practice;
- the competent authority has properly consulted competent authorities in other Member States that may be significantly affected by the action; and
- the action does not have a discriminatory effect on services or activities provided from another Member State.
Where the conditions set out in the first subparagraph are fulfilled, the competent authority 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. A prohibition or restriction may apply in circumstances, or be subject to exceptions, specified by the competent authority.
- The competent authority shall not impose a prohibition or restriction under this Article unless, not less than one month before the measure is intended to take effect, it has notified all other competent authorities involved and EIOPA in writing or through another medium agreed between the authorities of the details of:
- the insurance-based investment product, or activity or practice to which the proposed action relates;
- the precise nature of the proposed prohibition or restriction and when it is intended to take effect; and
- the evidence upon which it has based its decision and upon which it is satisfied that each of the conditions in paragraph 2 are met.
- In exceptional cases where the competent authority deems it necessary to take urgent action under this Article in order to prevent detriment arising from the insurance-based investment products, activities or practices referred to in paragraph 1, the competent authority may take action on a provisional basis with no less than 24 hours' written notice before the measure is intended to take effect to all other competent authorities and EIOPA, provided that all the criteria in this Article are met and that, in addition, it is clearly established that a one-month notification period would not adequately address the specific concern or threat. The competent authority shall not take action on a provisional basis for a period exceeding three months.
- The competent authority shall publish on its website notice of any decision to impose any prohibition or restriction referred to in paragraph 1. That notice shall specify details of the prohibition or restriction, a time after the publication of the notice from which the measures will take effect and the evidence upon which it is satisfied each of the conditions in paragraph 2 are met. The prohibition or restriction shall only apply in relation to action taken after the publication of the notice.
- The competent authority shall revoke a prohibition or restriction if the conditions in paragraph 2 no longer apply.
- The Commission shall adopt delegated acts in accordance with Article 30 specifying criteria and factors to be taken into account by competent authorities 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 financial system within at least one Member State referred to in point (a) of the first subparagraph of paragraph 2.
Those criteria and factors shall include:
- the degree of complexity of an insurance-based investment product and the relation to the type of investor to whom it is marketed and sold;
- the degree of innovation of an insurance-based investment product, an activity or a practice;
- the leverage a product or practice provides;
- in relation to the orderly functioning and integrity of financial markets, the size or the notional value of an insurance-based investment product.