According to Article 4(1) of the Insurance Distribution Directive (IDD), any insurance, reinsurance or ancillary insurance intermediary who intends to carry on business within the territory of another Member State for the first time, under the freedom to provide services, shall communicate specific information to the competent authority of its home Member State notably the name of any insurance or reinsurance undertaking represented and the relevant classes of insurance, if applicable (as per points (c) and (d) of Article 4(1) of the IDD).

Moreover, as laid down in Article 147 of Directive 2009/138/EC (Solvency II), “any insurance undertaking that intends to pursue business for the first time in one or more Member States under the freedom to provide services shall first notify the supervisory authorities of the home Member State, indicating the nature of the risks or commitments it proposes to cover."   This notification is subject to the procedure defined in Article 148 of the Solvency II Directive.

In the case that an insurance undertaking, on whose behalf that insurance intermediary is acting in the home Member State, did not submit a notification subject to the terms of Articles 147 and 148 of Solvency II, this insurance intermediary is not permitted to distribute any insurance products on behalf of that insurance undertaking in the host Member State (please keep in mind that this principle applies regardless of whether or not the intermediary has duly followed the applicable procedures to carry on business within the territory of another Member State under the freedom to provide services.) 

Please note that the above-mentioned notification sets out the classes of insurance that the insurance intermediary can distribute in the host Member State(s) on behalf of that insurance undertaking.

If the insurance intermediary would carry out distribution activities in the host Member States in breach of above detailed requirements, it would be considered to be carrying out an unauthorised insurance distribution activity and may also be subject to additional measures under the national law pertaining to the insurance distribution activity in the host Member State(s).

In addition, if the insurance intermediary intends to distribute the product(s) of the abovementioned insurance undertaking on the basis of a mandate from another insurance undertaking or insurance intermediary duly authorized to distribute insurance products, or certain classes of insurance, as applicable, in the respective host Member State on the basis of a horizontal co-operation agreement, this would not be permitted either. The fact that there is horizontal co-operation agreement in place which includes a mixture of mandates both from insurance undertakings or insurance intermediaries authorised to sell insurance products in the host Member State and from an insurance undertaking which is not authorised to sell products, does not obviate the need for the latter insurance undertaking to comply with the aforementioned Solvency II requirements. Therefore, if the insurance intermediary is mandated by an authorized insurance undertaking/​distributor in the host Member State, it can only distribute the products of insurance undertakings authorized to carry out cross-border business in the host Member State.