Prudential Regulation Authority Rulebook

7.1

A third country branch undertaking must fulfil the following requirements in the Conditions Governing Business Part, as modified by 7.2 to 7.12:

1. (1) Conditions Governing Business 1;
2. (1A) Conditions Governing Business 1A;
3. (2) Conditions Governing Business 2.2 to 2.6 (other than 2.2(3)(e));
4. (2A) Conditions Governing Business 2A (other than 2A.4);
5. (3) Conditions Governing Business 3 (other than 3.1(2)(b), 3.1A(8), 3.3, 3.5(3)(a), 3.5(3)(b), 3.8(2)(b)(i), 3.8(2)(c), 3.8(4), 3.8(5), 3.12(3) and 3.12(4));
6. (3A) Conditions Governing Business 3A;
7. (4) Conditions Governing Business 4 to 7; and
8. (5) Conditions Governing Business 11A, 11B, 11C, 11D, 11E and 11F.

7.2

1. (1) [Deleted]
2. (2) [Deleted]
3. (3) A reference to ‘technical provisions’ is to be interpreted as a reference to:
   1. (a) [deleted]
   2. (b) [deleted]
   3. (c) the provisions referred to in 6.1 of this Part.
4. (4) A reference to ‘function’ is to be interpreted as a reference to the functions performed in relation to the operations effected by the third country branch and includes the function of authorised UK representative.
5. (5) [Deleted]
6. (6) A reference to ‘best estimate’ is to be interpreted as ‘branch best estimate’.
7. (7) A reference to ‘the Technical Provisions Part’ should be read as a reference to 6.1 of this Part.
8. (8) A reference to ‘the Investments Part’ should be read as a reference to 8.3 of this Part.
9. (9) A reference to ‘the Valuation Part’ should be read as a reference to 6.3 of this Part.

7.3

A third country branch undertaking must apply the requirements referred to in 7.1 taking account only of matters relevant to the operations effected by the third country branch.

7.4

[Deleted]

7.5

1. (1) In Conditions Governing Business 1.2, the reference to ‘UK Solvency II firm’ in the definition of ‘concentration risk’ is to be interpreted as ‘third country branch undertaking’.
2. (2) In Conditions Governing Business 1A.1 references to the following defined terms are to be disregarded:
   1. (a) ‘own funds’;
   2. (b) ‘SCR’; and
   3. (c) ‘MCR’.
3. (3) In Conditions Governing Business 3.2, references to ‘and eligible own funds’ are to be disregarded.
4. (4) In Conditions Governing Business 3.5(2)(c) reference to ‘the firm as a whole’ should be read as ‘the third country branch’.
5. (5) In Conditions Governing Business 3.6, 3.6A and 3.6B to 3.6F references to the SCR are to be disregarded.
6. (6) In Conditions Governing Business 3.8A(1)(b) a reference to ‘own funds item’ is to be interpreted as a reference to the provisions referred to in 6.1 of this Part.
7. (7) In Conditions Governing Business 6.1(1)(i), reference to ‘the risk modelling underlying the calculation of the SCR and MCR’ is to be disregarded.

7.6

In Conditions Governing Business 2.2(3)(b), the reference to Conditions Governing Business 3 to 7 is to be interpreted with reference to 7.1(3) and the modifications set out in 7.2 and 7.5.

7.7

A firm must submit the assessments referred to in Conditions Governing Business 3.2 (as modified by 7.2 to 7.6) as part of the information reported annually in accordance with Reporting 2.

7.8

In Conditions Governing Business 4.2(1) ‘to the extent that these apply to third country branches in accordance with the Third Country Branches Part’ should be added after ‘deriving from FSMA that apply to UK Solvency II firms’.

7.9

In Conditions Governing Business 7.1 ‘to the extent that these apply to third country branches in accordance with the Third Country Branches Part’ should be added after ‘deriving from FSMA that apply to UK Solvency II firms’.

7.10

In Conditions Governing Business 11B.1(1) reference to Technical Provisions 13 should be interpreted as a reference to 6.1F of this Part.

7.11

In Conditions Governing Business 11B.1(2)(g) the references to Chapter 14 and rules 2.1 to 2.3 of the Technical Provisions Part should be interpreted as references to 6.1 of this Part.

7.12

In Conditions Governing Business 11B.1(2)(a) to (e), 11C.2(2) and 11C.3(8) the references to Technical Provisions - Further Requirements should be interpreted in accordance with Chapter 6 of this Part.