The European Insurance and Occupational Pensions Authority (Eiopa) is calling for evidence on the treatment of "infrastructure corporates" under Solvency II.
Market participants and re/insurance stakeholders have been asked to provide information and data on the nature of infrastructure corporates and their risk profile. Eiopa has described the areas that it is aware of and has set out the specific areas where it would be interested to know if additional evidence or data is available (see https://goo.gl/UnWMPK).
The deadline for responding to the call for evidence is 10 December Based on the feedback received, Eiopa will submit technical advice for the European Commission.
In a letter dated 14 October, the European Commission asked Eiopa to offer advice on revising the capital treatment of infrastructure corporates (IAR, 19 October, Commission may cut Solvency II capital charges for infrastructure corporates). This followed the Commission's adoption of a major legislative proposal to slash the capital charges that apply to debt and equity investments in low-risk infrastructure projects, which are typically made through special purpose vehicles (IAR, 1 October, Commission orders cut to Solvency II charges on infrastructure and ABS).
Eiopa has previously looked into the treatment of investments in companies engaged in infrastructure, but it found little evidence that the risk profile of these companies is different from companies in other sectors
The authority also argued that the targeted corporates may have other business that is not related to infrastructure, which would create delineation problems.