As well as annual submissions to the ACPR, the Solvency II directive calls for quarterly submissions of quantitative reports across a reduced scope.
Institutions may be able to claim exemption from this requirement for quarterly submissions where the provision of such information would represent a disproportionate workload given the nature, scale and complexity of the risks inherent in the institution’s business.
However, the directive specifies that the population granted such exemption by the ACPR may not exceed a 20% share of the French market, and that priority must be given to the smallest institutions. An ACPR instruction (see below) sets out the following thresholds for exemption from the requirement to submit quarterly information, based on the size of the institution’s or the group’s balance sheet and the nature of its business:
|Nature of business||Maximum balance sheet size (EUR billions)|
|Mixed||Minimum (8 ; 0,5 × total technical provisions/ non-life technical provisions)|
In other words, for mixed institutions and groups, if balance sheet assets exceed EUR 8 billion, this threshold is applicable; otherwise, the threshold of EUR 0.5 billion is applied to that portion of their balance sheet that corresponds to non-life business according to the following formula: balance sheet size x non-life technical provisions/total technical provisions.
A page containing comprehensive information on the precise terms of application of these thresholds is available on the ACPR website.
In simplified terms, these thresholds apply to groups and institutions as follows:
- Institutions not belonging to a group will be exempted, without the need to apply for authorisation, if their total balance sheet assets fall below the thresholds.
- The same applies to groups whose total consolidated or combined balance sheets fall below the thresholds, as well as institutions belonging to those groups.
- Institutions whose balance sheet assets fall below the thresholds but which belong to a group whose consolidated or combined balance sheet assets exceed the thresholds may also claim exemption provided that they meet both of the following criteria: o the individual institution represents less than 5% of the consolidated or combined balance sheet o exempted institutions belonging to the same group together represent no more than 15% of the consolidated or combined balance sheet
- Institutions and groups whose balance sheet assets exceed the thresholds may not claim exemption.
Exempted institutions must nevertheless calculate and submit quarterly reports on the MCR.