4

Eligibility and Limits Applicable to Tiers

4.1

As far as compliance with its SCR is concerned at least the following conditions must be met:

  1. (1) more than one-third of the total amount of the firm’s eligible own funds is accounted for by Tier 1 own funds; and
  2. (2) less than one-third of the firm’s eligible own funds is accounted for by Tier 3 own funds.

[Note: Art. 98(1) of the Solvency II Directive]

4.2

As far as compliance with its MCR is concerned, as a minimum more than 50% of the firm’s eligible own funds must be accounted for by Tier 1 own funds.

[Note: Art. 98(2) of the Solvency II Directive]