The European Commission is proposing to call a halt to talks on new legislation covering the insurance industry until the European Insurance and Occupational Pensions Authority can complete a new study on the impact of the proposed rules, expected in March 2013.Commissioner Michel Barnier suggested the break during closed-door negotiations Tuesday in order to overcome an impasse between the European Parliament and European Union member countries. At issue is Solvency II, a stringent set of Europe-wide rules for insurers regarding reporting needs and the management of capital and risk that has raised concerns over investment into the EU.
"Making sure that EU rules favor long-term investment for our economies is key for Commissioner Barnier, as is improved risk management for the insurance industry," said EU spokesman Stefaan De Rynck in a statement.
The co-legislators, the European Parliament and member states, are likely to agree to a freeze in talks.
"Everybody seems to want this study by EIOPA," said a person close to the negotiations.
Sharon Bowles, head of the European Parliament's economics committee, said that the Brussels body asked for the study because member states "were asking to put in all these things that weren't in before."
She said Parliament is waiting for the commission to produce an updated timeline for implementation of the new measures, but a delay is likely.
The original timetable called for EU member states to incorporate the new rules into national law by June 30 of next year, with companies applying the new rules starting on Jan. 1, 2014.
Last week, Gabriel Bernardino, the chairman of the EU's insurance regulator, said on the sidelines of a conference that implementing the planned capital- and risk-management regime for insurers by 2014 is still possible. The ultimate decision doesn't rest with him, he said, but at the political level.