Insurance Block Exemption Regulation (IBER)

In December 2016, the European Commission decided not to renew the Insurance Block Exemption Regulation (IBER) and took note of its expiry on 31 March 2017.

A Block Exemption Regulation exempts certain practices from the general prohibition on anti-competitive practices enshrined in the Treaty, provided they comply with the conditions set out in the Regulation. The IBER allowed insurers and reinsurers to benefit from an exemption to the prohibition of anti-competitive arrangements laid down in Article 101(1) of the Treaty on the Functioning of the European Union (TFEU). The exemption covered two types of agreements between insurance or reinsurance companies:

a) agreements with respect to joint compilations, joint tables and studies; and

b) common coverage of certain types of risks (co-insurance or co-reinsurance pools).

A Block Exemption Regulation is an exceptional legal instrument. The IBER therefore needed to be reviewed at regular intervals. The IBER was last renewed in 2010. In 2016, the Commission had to determine whether the insurance sector differs sufficiently from other sectors which do not benefit from a Block Exemption Regulation so that such a sector-specific antitrust regime is justified.

In order to provide continuing effective protection of competition in the insurance sector while ensuring that the beneficial aspects of co-operations remain, the Commission considered several policy options. These were to (1) let the IBER expire on 31 March 2017 as foreseen in a sunset clause, (2) to prolong the IBER for another ten years or (3) to prolong the IBER for either of the two exemptions.

In its March 2016 Report on the functioning and future of IBER, the Commission already presented its preliminary view to let the IBER lapse because several of the considerations which led to the adoption and later prolongation of the IBER were no longer present: The Commission's Guidelines on horizontal cooperation published in 2011 already offer guidance on how to assess the conformity of joint compilations, tables and studies with the antitrust rules. Moreover, the Commission showed that the exemption for pools in the IBER was less and less used in practice.

The subsequent public consultation in which BIPAR participated, empirical fact finding and concluding Impact Assessment reinforced the Commission's preliminary orientation. It therefore decided to let the IBER expire on 31 March 2017.

The Commission explained that the expiry of the IBER does not mean that these forms of co-operation become unlawful under Article 101 TFEU. Rather, insurers, as all other companies doing business in the EU, will need to assess their co-operation in the market context to see whether it is in line with antitrust rules. Following the expiry, the Commission will continue to monitor developments in the market to evaluate how insurers adapt to the change, particularly for the first 12 months after the IBER expires. The Commission also explained that it is not prepared to adopt guidance on competition issues relevant to the insurance market but will explore the need if the expiry leads to pronounced legal uncertainty. The Commission included some steer on how to assess the types of cooperation previously covered by IBER under its more general horizontal guidelines in its impact assessment report.

Looking for an insurance intermediary near your home or business?Find one