BIPAR PRESS No 4 - October 2007

• European Union
  
  
  • MEP report on Single Market review welcomed by SMEs
    
    On 4 September SMEs welcomed the adoption of the Toubon report by a large majority of MEPs on the "Single Market Review: tackling barriers and inefficiencies through better implementation and enforcement". According to the report, the Commission must focus on citizen and SME-friendly initiatives and an improvement in the functioning of the Single Market is still necessary to deliver additional benefits to business and consumers. The report also stresses that public contracts must be awarded in a fair and transparent manner, observing public procurement rules, and that they may also help promote innovation and technological development as well as help respond to environmental and social concerns. The Parliament calls on the Commission to encourage Member States to improve access for SMEs to public procurement contracts. According to UEAPME, the European Association representing SMEs, SMEs are now mostly excluded from the scope of the World Trade Organisation agreement on public contracts.
    The report seeks to provide recommendations for the Commission's review of the Single Market. The latter is expected to present a Communication on the subject in November 2007. This Communication will also present the results of the consultation on the Commission's Green Paper on Retail Financial Services in the Single Market (issued in May 2007), which announced a complete review of the IMD in 2008/2009. BIPAR will closely monitor all the issues taken up in this Communication.
    
    
  • Towards a European consumer code?
    
    On 6 September, the European Parliament adopted MEP Béatrice Patrie's draft resolution on the revision of the Community acquis on consumer protection. The resolution aims at instituting a European consumer code so that "consumers no longer hesitate to buy goods in a country other than their own and know what rights of appeal they can benefit from in all countries of the Union", announced Ms Patrie. She claims she has reached a political consensus favourable to a legislative approach that combines a horizontal instrument, which aims at making existing legislation coherent, and a vertical instrument for specific issues such as time-sharing, the sale of all-inclusive trips or the rules for door-to-door sales.
    MEP Patrie's report is available at: http://www.europolitics.info/web/external-file/pdf/gratuit_en/206642-en.pdf
    
    
  • Improving the application of community law through prevention
    
    On 7 September, the European Commission published a Communication entitled "A Europe of results - Applying community law". At the end of 2006, over 3,200 complaints and official proceedings, in addition to requests for information, were being processed by the Commission. In order to improve the way in which infringement proceedings are dealt with and to take into account the increasing complexity of the application of community law in the enlarged EU, the Commission wants to focus on prevention, i.e. take better account of the implementation of community acts and policies during their drafting, obtain an increased commitment from Member States to better resolve problems and train national civil servants and judges in community law. The Commission will draft a programme to carry out its new measures. Detailed information is available in the Communication, which can be downloaded from the following link: http://ec.europa.eu/community_law/eulaw/pdf/com_2007_502_en.pdf
    
    
  • MEPs report on democratic deficiencies in EU lawmaking
    
    According to the European Parliament (EP), there is still substantial room for improvement when it comes to assessing in advance the impact of new legislation. MEPs have called for the setting up of an independent panel of experts who will check the work of the existing Impact Assessment Board, created in 2006, which is made up of high-level Commission officials and whose task is to scrutinise the quality of draft impact assessments.
    The EP is also strongly opposed to the "goldplating" practice used by national governments, which consists in widening the scope of EU legislation during its transposition into national law. This was, for example, the case with the Insurance Mediation Directive. It proposes, among other things, follow-up impact assessments to examine how laws are transposed.
    MEPs further criticise the use of "soft law" instruments, i.e. Communications, Recommendations, Green and White papers. They say these type of instruments should be used only in exceptional cases because they are "ambiguous", "ineffective" and "legally dubious" as they operate "without sufficient parliamentary participation and judicial review". Moreover, according to the EP, even if these soft law instruments are not legally binding, they have some legal influence; for instance, national courts take such Commission's documents into account when deciding disputes.
    
    
  • Towards common principles of flexicurity
    
    On 13 September the Portuguese Presidency organised a major conference on flexicurity. Flexicurity is a new way of looking at flexibility and security on the labour market. It promotes a combination of flexible labour markets and a high level of employment and income security, and it is thus seen to be the answer to the EU's dilemma of how to maintain and improve competitiveness while preserving the European social model. The main objective of the conference was to provide a platform for Member States and other partners to discuss for the first time the European Commission's June Communication, in which a set of possible common principles of flexicurity is proposed. These are due to be discussed and agreed on by EU leaders at the EU Summit of 13 and 14 December 2007.
    The Communication (available in English only) can be found at: http://ec.europa.eu/employment_social/news/2007/jun/flexicurity_en.pdf
    
    
• France
  
  
  • French insurance agents launched a publicity campaign
    
    On 19 September, the French Association of insurance agents (AGEA, member of BIPAR) launched a one-week publicity campaign, with the message "No to anonymity - Insurance agent - One insures better when one knows one's customer better". This message appeared on 10,000 bus stops and insurance agencies in France. AGEA's objective was to make the profession more "visible" among the public and local, national and European decision-makers. Insurance agents are encouraged to carry on the publicity campaign in their agencies.
    AGEA will circulate from November 2007 onwards a White Paper on insurance agents' role. This paper aims at providing economic and political decision-makers concrete elements on the know-how and added value created by insurance agents in the distribution of insurance and their participation in the French economic development. The White Paper will be sent to over one thousand personalities of the political and economical world (President of the Republic, ministers, deputies, representatives of professional organisations, ...).
    
    
• Germany
  
  
  • Brokers and insurers unhappy about new disclosure rules
    
    The German insurance federation, the GDV, and the association of German insurance brokers, the VDVM (member association of BIPAR), are strongly opposed to the government's transparency provisions in the proposed information directive to be issued later this year as part of the new German Insurance Contract Act. Brokers are concerned about the lack of differentiation between information to be provided to private customers and that required by commercial and industrial customers. The draft directive requires insurers and intermediaries to give to clients a precise monetary figure of commission earned on a particular life or health contract. According to the VDVM, such figures are useless for customers when comparing contracts, especially if they are not identical contracts. The new Insurance Contract Act aims mainly at improving consumers' rights and will apply to all new insurance contracts concluded as from 1st January 2008. The German insurance industry will have to review its business routines, especially the distribution systems, in order to comply with the new rules.
    
    
  • Insurers look for alternative distribution channels
    
    In Germany, non-life insurers expect again in 2007 a drop in their premiums due to price competition. As a result, many of them try to find alternative distribution channels to sell their insurance products and make them more visible for retail customers.
    - Rewe Group's Penny discount chain recently joined the ARAG insurance company to offer a policy for children that combines accident, legal expenses and insurance coverage. The package is unique in form in the German insurance industry, and it will be on sale from 17 September during 4 weeks throughout Germany at Penny's 2,000 stores.
    - Insurance group Zurich recently launched a new pan-European internet platform. Customers in Germany can now buy easily and directly through the web, car, household and private liability insurance policies. Zurich is the first insurer to introduce a unified pan-European set of products and services on the web that makes it possible to offer similar products on a European scale. These products can be tailored to local standards and legal requirements in each country.
    - Since last year, Belgian-based clothing retailer C&A has been offering car insurance in its 380 German outlets, in cooperation with DA Direkt, a subsidiary of Swiss insurance group Zurich. The company offers policies that are up to 30 per cent cheaper than standard insurance policies.
    - Coffee giant Tchibo was the first retailer to sell an insurance product in Germany. Back in 2002, it started offering a private pension plan developed by AXA, but the project was not very successful. Today, customers enjoy attractive conditions from the well-known supplier Tchibo, thanks to telephone-only counselling and a minimum of paperwork. Unlike the products sold exclusively by AXA, those sold through Tchibo are standardised products. They are geared to customers who have found all they needed to know about the product beforehand.
    
    
• Poland
  
  
  • Polish direct motor insurance market full of promise
    
    The direct motor insurance market in Poland is booming. According to statistics, car ownership has grown exponentially in Poland over the past 15 years, with 43% of the population now owning cars and the car insurance market is expected to double within the next 10 years. Despite harsh competition, the Polish market is considered as a very promising one, with 13 million cars. In October 2006, AXA entered the Polish market through its Direct Assurance company - number one in France in the sale of direct motor insurance; American insurer Liberty Mutual has just started selling motor insurance contracts through its direct sale subsidiary, Liberty Direct, and is expecting several thousands of contracts per month; Britain's biggest insurer Aviva also started to sell policies this year direct to customers via telephone and internet.
    
    
• UK
  • UK to transpose new directive on sex discrimination
    
    UK will shortly implement legislation to bring into force the European Directive on equal treatment between men and women in the access to and supply of goods and services, which was adopted in December 2004.
    The new law will have an impact on insurance providers who seek to differentiate between men and women in setting premiums and benefits (for example, in motor, health and critical illness insurance). The Directive, which must be implemented into national law by EU Member States by 21 December 2007 at the latest, stipulates that new contracts concluded after 21 December should not produce sex-related differences in premiums and benefits in order to ensure equal treatment between men and women, but Member States can derogate from this where sex can be said to be a determining factor in the assessment of risks insured "as long as they can ensure that underlying actuarial and statistical data on which the calculations are based, are reliable, regularly updated and available to the public". The public consultation period on the new draft law has just ended in the UK and the final regulations are to be published shortly, along with final guidance from the British government concerning the data which must be published and regularly updated.
    
    
  
  
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