- Judge’s refusal to sanction Prudential’s Part VII annuity insurance business transfer overturned by the Court of Appeal (Re Prudential Assurance Company Ltd and Rothesay Life plc)
- What was the background?
- What did the court decide?
- The appellants’ arguments and the issues to be determined
- The approach to the sanction of FSMA 2000, Pt VII applications
- The Court of Appeal’s determination of the issues
- What are the practical implications of this case?
- Case details
Insurance & Reinsurance analysis: On 2 December 2020, the Court of Appeal handed down its decision in the long-awaited appeal of Mr Justice Snowden’s (the judge) refusal to allow the application made by Prudential Assurance Company (PAC) and Rothesay Life plc (Rothesay) pursuant to Part VII of the Financial Services and Markets Act 2000 (FSMA 2000) to sanction an insurance business transfer scheme (the scheme). The Court of Appeal concluded that the first instance judge had erred in his approach to the exercise of his discretion as to whether to sanction the scheme under FSMA 2000, s 111(3). The question of whether PAC’s proposed transfer of its approximately 370,000 annuity policies to Rothesay should be sanctioned has now been remitted to the High Court for further consideration. Before dealing with the specific issues raised on the appeal, the Court of Appeal set out what it derived from the legislation and the authorities, and what it considered should be the approach to the sanction of applications under FSMA 2000, Pt VII. This case is essential reading for anyone considering FSMA 2000, Pt VII transfer application, particularly for long-term insurance business, as this authority is an appellate court’s first consideration of the jurisdiction. Written by Charlotte Eborall, barrister, at 3 Verulam Buildings.
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