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the following articles are inserted: ‘Article 29a Criteria for identifying small and non-complex undertakings 1. Member States shall ensure that undertakings are classified as small and non-complex undertakings, in accordance with the process set out in Article 29b, where, for the two consecutive financial years directly prior to such classification, the undertakings meet the following criteria: The criteria laid down in points (a)(ii) and (v), points (b)(ii) and (vi), and points (c)(v) and (viii) of the first subparagraph shall not apply to captive insurance undertakings or to captive reinsurance undertakings. By way of derogation from the first subparagraph, captive insurance undertakings and captive reinsurance undertakings shall also be classified as small and non-complex undertakings where they do not comply with the criteria laid down in the first subparagraph provided they comply with both of the following criteria: 2. For undertakings which have obtained authorisation in accordance with Article 14 within the last two financial years, compliance with the criteria set out in paragraph 1 of this Article shall be assessed with reference to the last financial year prior to the classification, or where the authorisation has been obtained within the last 12 months, the scheme of operations referred to in Article 23. 3. The following undertakings shall never be classified as small and non-complex undertakings: Article 29b Process of classification for undertakings complying with the criteria 1. Member States shall ensure that undertakings complying with the criteria set out in Article 29a may notify the supervisory authority of such compliance with a view to being classified as small and non-complex undertakings. 2. The notification referred to in paragraph 1 of this Article shall be submitted by the undertaking to the supervisory authority of the Member State that granted the prior authorisation referred to in Article 14. That notification shall include all of the following: 3. The supervisory authority may oppose the classification as a small and non-complex undertaking within two months of receipt of the complete notification referred to in paragraph 1 on grounds related exclusively to any of the following: 4. Any decision of the supervisory authority to oppose the classification as a small and non-complex undertaking shall state the reasons therefor and shall be communicated to the undertaking concerned in writing. In the absence of such a decision, the undertaking shall be classified as a small and non-complex undertaking as of the end of the two-month period referred to in paragraph 3. Where, before the end of the two-month period referred to in paragraph 3, the supervisory authority has issued a decision confirming compliance with the criteria, the undertaking shall be classified as a small and non-complex undertaking as of the date of such decision. 5. With respect to requests received by supervisory authorities within the first six months of 30 January 2027, the period referred to in paragraph 3 shall be extended to four months. 6. An undertaking shall be classified as a small and non-complex undertaking for as long as such classification does not cease in accordance with this paragraph. Where a small and non-complex undertaking no longer complies with any of the criteria set out in Article 29a(1), it shall inform the supervisory authority without delay. Where such non-compliance continuously persists over two consecutive years, the undertaking shall inform the supervisory authority thereof, and shall cease to be classified as a small and non-complex undertaking as from the following financial year. Where an undertaking that has been classified as a small and non-complex undertaking fulfils any of the exclusion criteria set out in Article 29a(3), that undertaking shall inform the supervisory authority without delay and shall cease to be classified as a small and non-complex undertaking as from the following financial year. Article 29c Use of proportionality measures by undertakings classified as small and non-complex undertakings 1. Member States shall ensure that undertakings classified as small and non-complex undertakings may use all proportionality measures. 2. By way of derogation from paragraph 1, where the supervisory authority has serious concerns in relation to the risk profile of a small and non-complex undertaking, the supervisory authority may request the undertaking concerned to refrain from using one or several proportionality measures, provided that the request is duly justified in writing with reference to the specific concerns relating to the risk profile of the undertaking. A serious concern shall be considered to exist where: Article 29d Use of proportionality measures by undertakings not classified as small and non-complex undertakings 1. Member States shall ensure that insurance and reinsurance undertakings that are not classified as small and non-complex undertakings may only use proportionality measures as provided for in Article 35(5a), Article 41, Article 45(1b), Article 45(5), Article 77(8) and Article 144a(4) and proportionality measures as provided for in the delegated acts adopted pursuant to this Directive that are both explicitly applicable to small and non-complex undertakings in accordance with Article 29c and identified for the purposes of this Article, with the prior approval of the supervisory authority. The insurance or reinsurance undertaking shall submit a request in writing for approval to the supervisory authority. That request shall include: 2. The supervisory authority shall, within two months of receipt of the request referred to in paragraph 1, second subparagraph, assess the request and inform the undertaking of its approval or rejection, as well as of the proportionality measures the use of which has been approved. Where the supervisory authority approves the use of proportionality measures under certain terms or conditions, the approval decision shall contain the reasons for those terms and conditions. A decision of the supervisory authority to oppose the use of one or more of the proportionality measures listed in the request shall be notified in writing, and state the reasons for the supervisory authority’s decision. Such reasons shall be linked to the risk profile of the undertaking. 3. The supervisory authority may request any further information that is necessary to complete the assessment referred to in paragraph 2. The period referred to in that paragraph shall be suspended for the period between the date of the first request for information by the supervisory authorities and the receipt of a response thereto by the concerned undertaking. Any further requests by the supervisory authority shall not result in a suspension of the assessment period. 4. With respect to requests received by supervisory authorities before 31 July 2027, the period referred to in paragraph 2 shall be four months. 5. Approval to use proportionality measures may be amended or withdrawn at any point in time if the insurance or reinsurance undertaking’s risk profile has changed. Any decision of the supervisory authority to amend or withdraw that approval shall state the reasons therefor and shall be communicated to the undertaking concerned in writing. Article 29e Monitoring of the use of proportionality measures 1. Within one year of their classification as small and non-complex undertakings, insurance and reinsurance undertakings shall report to their supervisory authorities information on the proportionality measures used as part of the information to be provided for supervisory purposes referred to in Article 35. Where such undertakings intend to change the list of proportionality measures to be used, they shall notify their supervisory authorities immediately. 2. Where insurance and reinsurance undertakings which use proportionality measures pursuant to Article 29d decide to stop using any such measures, they shall inform their supervisory authorities thereof. 3. Insurance and reinsurance undertakings applying any proportionality measures that correspond to existing measures under this Directive by 28 January 2025 may continue to apply such measures without applying the requirements set out in Articles 29b, 29c and 29d, for a period not exceeding four financial years.’ ; For undertakings pursuing life activities and for undertakings pursuing both life and non-life activities whose technical provisions related to the life activities represent 20 % or more of the total technical provisions gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76, and whose annual gross written premium income related to the non-life activities represents less than 40 % of the total annual gross written premium, all of the following criteria shall be met: the interest rate risk submodule referred to in Article 105(5), second subparagraph, point (a), is not higher than 5 % of the technical provisions, gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76; annual gross written premium income from business underwritten in Member States other than the home Member State where the undertaking received its authorisation in accordance with Article 14 is lower than either of the following thresholds: EUR 20 000 000; 10 % of its total annual gross written premium income; technical provisions from life activities, gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76, are not higher than EUR 1 000 000 000; the sum of the following is not higher than 20 % of total investments: the market risk module referred to in Article 105(5); the part of the counterparty default risk module referred to in Article 105(6), that corresponds to exposures to securitisations, derivatives, receivables from intermediaries and other investment assets which are not covered in the spread risk sub-module; any capital requirement that is applicable to investments in intangible assets that are not covered by the market risk and the counterparty default risk modules; the reinsurance accepted by the undertaking does not exceed 50 % of its total annual gross written premium income; the Solvency Capital Requirement is complied with. For undertakings pursuing non-life activities and for undertakings pursuing both life and non-life activities whose annual gross written premium income related to the non-life activities represent 40 % or more of their total annual gross written premium income and whose technical provisions related to the life activities represent less than 20 % of their total technical provisions gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76, all of the following criteria shall be met: the average combined ratio for non-life activities net of reinsurance of the last three years is less than 100 %; annual gross written premium income from business underwritten in Member States other than the home Member State where the undertaking received its authorisation in accordance with Article 14 is lower than either of the following thresholds: EUR 20 000 000; 10 % of its total annual gross written premium income; the annual gross written premium income from non-life activities is not higher than EUR 100 000 000; the sum of the annual gross written premiums in classes 5 to 7, 11, 12, 14 and 15 in Part A of Annex I is not higher than 30 % of total annual written premiums of non-life business; the sum of the following is not higher than 20 % of total investments: the market risk module referred to in Article 105(5); the part of the counterparty default risk module referred to in Article 105(6), that corresponds to exposures to securitisations, derivatives, receivables from intermediaries and other investment assets which are not covered in the spread risk sub-module; any capital requirement that is applicable to investments in intangible assets that are not covered by the market risk and the counterparty default risk modules; the reinsurance accepted by the undertaking does not exceed 50 % of its total annual gross written premium income; the Solvency Capital Requirement is complied with. For undertakings pursuing both life and non-life activities whose technical provisions related to the life activities represent 20 % or more of their total technical provisions gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76, and whose annual gross written premium income related to the non-life activities represents 40 % or more of their total annual gross written premium income, all of the following criteria shall be met: the interest rate risk submodule referred to in Article 105(5), second subparagraph, point (a), is not higher than 5 % of the technical provisions, gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76; the average combined ratio for non-life activities net of reinsurance of the last three years is less than 100 %; technical provisions from life activities, gross of the amounts recoverable from reinsurance contracts and special purpose vehicles, as referred to in Article 76, are not higher than EUR 1 000 000 000; the annual gross written premium income from non-life activities is not higher than EUR 100 000 000; annual gross written premium income from business underwritten in Member States other than the home Member State where the undertaking received its authorisation in accordance with Article 14 is lower than either of the following thresholds: EUR 20 000 000; 10 % of its total annual gross written premium income; the sum of the annual gross written premium in classes 5 to 7, 11, 12, 14 and 15 in Part A of Annex I is not higher than 30 % of total annual written premiums of non-life business; the sum of the following is not higher than 20 % of total investments: the market risk module referred to in Article 105(5); the part of the counterparty default risk module referred to in Article 105(6), that corresponds to exposures to securitisations, derivatives, receivables from intermediaries and other investment assets which are not covered in the spread risk sub-module; any capital requirement that is applicable to investments in intangible assets that are not covered by the market risk and the counterparty default risk modules; the reinsurance accepted by the undertaking does not exceed 50 % of its total annual gross written premium income; the Solvency Capital Requirement is complied with. the insured persons and beneficiaries are any of the following: legal entities of the group of which the captive insurance undertaking or captive reinsurance undertaking is part, natural persons eligible to be covered under that group’s insurance policies, provided that the business covering those natural persons remains below 5 % of technical provisions; the insurance obligations and the insurance contracts underlying the reinsurance obligations of the captive insurance undertaking or captive reinsurance undertaking do not consist of any compulsory third-party liability insurance. undertakings that use an approved partial or full internal model to calculate the Solvency Capital Requirement, in accordance with the requirements for full and partial internal models set out in Chapter VI, Section 4, Subsection 3; undertakings that are parent undertakings of a financial conglomerate within the meaning of Article 2, point (14), of Directive 2002/87/EC or of a group within the meaning of Article 212 of this Directive, to which group supervision applies in accordance with Article 213(2), point (a) or (b), of this Directive unless the group is classified as a small and non-complex group; undertakings that are the parent undertaking of an undertaking referred to in Article 228(1), points (a) to (e); undertakings that manage group pension funds within the meaning of Article 2(3), points (b)(iii) and (b)(iv), where the value of the assets of the group pension funds exceeds EUR 1 000 000 000. evidence of the compliance with all criteria set out in Article 29a applicable to that undertaking; a declaration that the undertaking does not plan any strategic change that would lead to non-compliance with any of the criteria set out in Article 29a within the next three years; an identification of the proportionality measures the undertaking expects to implement, in particular if the best estimate simplification is intended to be used and whether the undertaking plans to use the simplified method to calculate technical provisions laid down in Article 77(8). non-compliance with the criteria provided for in Article 29a; non-compliance with the Solvency Capital Requirement, assessed without the use of any of the transitional measures referred to in Article 77a(2), Article 308c, Article 308d or, where relevant, Article 111(1), second subparagraph; the undertaking represents more than 5 % of the life market or, where applicable, non-life market in accordance with Article 35a(1), second subparagraph, of the home Member State of the undertaking. the Solvency Capital Requirement is no longer complied with, or there is a risk of non-compliance in the following three months assessed, where applicable, without the use of any of the transitional measures referred to in Article 77a(2), Article 308c, Article 308d or, where relevant, Article 111(1), second subparagraph; the system of governance of the undertaking is not effective within the meaning of Article 41; or material changes in the risk profile of the undertaking could lead to significant non-compliance of any of the criteria set out in Article 29a(1). a list of the proportionality measures intended to be used and the reasons why their use is justified in relation to the nature, scale and complexity of the risks inherent in the business of the undertaking; any other material information regarding the risk profile of the undertaking; a declaration that the undertaking does not plan any strategic change that would have an impact on the risk profile of the undertaking within the next three years.

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Source: EUR-Lex (Cellar) · retrieved 2026-10-14 · Text as adopted (Official Journal); later amendments are not incorporated in this text.