1 Citation, commencement and effect

(1)    These Regulations may be cited as the Insurance Companies (Overseas Life Assurance Business) (Compliance) (Amendment) Regulations 2007 and shall come into force on 13th August 2007.

(2)    These Regulations have effect in relation to accounting periods beginning on or after 1st January 2007 and ending on or after the date on which these Regulations come into force.

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see para (1) above.

2 Amendments to the Insurance Companies (Overseas Life Assurance Business) (Compliance) Regulations 1995

2Amendments to the Insurance Companies (Overseas Life Assurance Business) (Compliance) Regulations 1995

The Insurance Companies (Overseas Life Assurance Business) (Compliance) Regulations 1995 are amended as follows.

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Financial Institutions95 Company Law & Business Entities92 Companies & Corporate Bodies92 Banking & Finance Law95 Transnational & Multinational Companies92

3 Amendment of regulation 2

3Amendment of regulation 2

(1)    Regulation 2 (interpretation) is amended as follows.

(2)    In paragraph (1)—

(a)    insert the following definitions in the appropriate places—

““child trust fund business” has the meaning given by section 431BA;”, and

““excepted business” means pension business, individual savings account business, child trust fund business, life reinsurance business and long-term business which is not life assurance business;”;

(b)    for the definition of “individual savings account business” substitute—

““individual savings account business” has the meaning given by section 431BB;”;

(c)    for the definition of “relevant business” substitute—

““relevant business” means—

(a)    in the case of an overseas life insurance company, life assurance business carried on through a permanent establishment in the United Kingdom which is not excepted business, and

(b)    in any other case, life assurance business which is not excepted business;”;

(d)    in the definition of “relevant policy”, omit “, or any underlying policy,”; and

(e)    omit the definition of “underlying policy”.

(3)    In paragraph (3), omit “9, 10”.

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Company Law & Business Entities92 Insurance Law95 Companies & Corporate Bodies92 Family Law99 Banking & Finance Law94 Financial Support of Children99 Transnational & Multinational Companies92 Reinsurance95 Financial Institutions94

4 Insertion of regulation 3B

4Insertion of regulation 3B

After regulation 3A (exclusion of business of friendly society which is exempt from tax) insert—

“3B Exclusion of tax exempt life assurance business

These Regulations do not apply to any business of an insurance company the profits arising from which are exempt from corporation tax by virtue of section 460(11) or (12) of the Income and Corporation Taxes Act 1988.”

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Corporation Tax99 Tax Law99 Company Law & Business Entities92 Companies & Corporate Bodies92

5 Amendment of regulation 4

5Amendment of regulation 4

In regulation 4 (business which is overseas life assurance business: general), for “11” substitute “8”.

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

6 Amendment of regulations 5, 7, 7A and 8

6Amendment of regulations 5, 7, 7A and 8

In the following places, for “branch” substitute “permanent establishment”—

(a)    regulation 5 (business other than reinsurance business effected by a company resident in the United Kingdom outside the United Kingdom) (wherever occurring),

(b)    regulation 7 (business other than reinsurance business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company—policies or contacts made on or after 1st January 1996) (wherever occurring except in paragraph (1A)),

(c)    regulation 7A (business other than reinsurance business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company—policy holder not within regulation 7) (wherever occurring except in paragraph (2)), and

(d)    regulation 8 (certain business other than reinsurance business where the company comes into possession of additional information) (wherever occurring except in paragraph (1A)).

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Company Law & Business Entities92 Insurance Law94 Companies & Corporate Bodies92 Banking & Finance Law94 Transnational & Multinational Companies92 Reinsurance94 Financial Institutions94

7 Omission of regulations 9, 10, 10A and 11

7Omission of regulations 9, 10, 10A and 11

Omit—

(a)    regulation 9 (reinsurance of business effected by a company resident in the United Kingdom outside the United Kingdom),

(b)    regulation 10 (reinsurance of business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company),

(c)    regulation 10A (reinsurance of business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company—policy holder not within regulation 7), and

(d)    regulation 11 (classification of certain categories of reinsurance business as overseas life assurance business).

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Company Law & Business Entities92 Insurance Law93 Companies & Corporate Bodies92 Banking & Finance Law95 Transnational & Multinational Companies92 Reinsurance93 Financial Institutions95

8 Amendment of regulation 12

8Amendment of regulation 12

In regulation 12 (territories in which policy holders residing: general), for “16A” substitute “14A”.

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Company Law & Business Entities93 Companies & Corporate Bodies93 Transnational & Multinational Companies93

9 Amendment of regulations 13, 14 and 14A

9Amendment of regulations 13, 14 and 14A

For “branch” substitute “permanent establishment”—

(a)    in regulation 13 (business other than reinsurance business effected by a company resident in the United Kingdom outside the United Kingdom) (wherever occurring except in paragraph (1A)),

(b)    in regulation 14 (business other than reinsurance business effected by a company resident in the United Kingdom outside the United Kingdom or by an overseas life insurance company) (wherever occurring except in paragraph (1A)), and

(c)    in regulation 14A (business other than reinsurance business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company—policy holder not within regulation 7) (wherever occurring except in paragraph (2)).

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Reinsurance95 Insurance Law95

10 Omission of regulations 15, 16 and 16A

10Omission of regulations 15, 16 and 16A

Omit—

(a)    regulation 15 (reinsurance business effected by a company resident in the United Kingdom outside the United Kingdom),

(b)    regulation 16 (reinsurance business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company), and

(c)    regulation 16A (reinsurance business effected either by a company resident in the United Kingdom otherwise than outside the United Kingdom or by an overseas life insurance company—policy holder not within regulation 7).

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Reinsurance95 Insurance Law95

11 Amendment of regulation 18

11Amendment of regulation 18

(1)    Regulation 18 (reclassification of policy or contract from date when it was effected) is amended as follows.

(2)    In paragraph (1)—

(a)    omit sub-paragraphs (aa), (b), (ba) and (d), and

(b)    in sub-paragraph (e)—

(i)    for “policy, contract or underlying policy” substitute “policy or contract”,

(ii)    omit “or the relevant business in relation to that underlying policy was entered into”,

(iii)    renumber paragraph (a) as paragraph (i), and

(iv)    renumber paragraph (b) as paragraph (ii).

(3)    Omit paragraph (2).

(4)    For paragraph (3), substitute—

“(3)    The company shall treat the policy or contract as relating to basic life assurance and general annuity business from the date the policy or contract was made or transferred."

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

12 Amendment of regulation 19

12Amendment of regulation 19

(1)    Regulation 19 (reclassification of policy or contract from date after it was effected) is amended as follows.

(2)    In paragraph (1)—

(a)    omit sub-paragraphs (b) and (d), and

(b)    in sub-paragraph (e)—

(i)    for “policy, contract or underlying policy” substitute “policy or contract”,

(ii)    omit “or the relevant business in relation to that underlying policy was entered into”,

(iii)    renumber paragraph (a) as paragraph (i), and

(iv)    renumber paragraph (b) as paragraph (ii).

(3)    Omit paragraph (2).

(4)    For paragraph (3), substitute—

“(3)    Subject to paragraphs (3A) and (3B) below, the company shall treat the policy or contract as relating to basic life assurance and general annuity business from the end of the accounting period in which the relevant date falls."

NOTES
Initial Commencement
Specified date

Specified date: 13 August 2007: see reg 1(1).

Signature

Mike Eland

Dave Hartnett

Two of the Commissioners for Her Majesty's Revenue and Customs

20th July 2007

EXPLANATORY NOTE

EXPLANATORY NOTE (This note is not part of the Regulations)

These Regulations amend the Insurance Companies (Overseas Life Assurance Business) (Compliance) Regulations 1995 (SI 1995/3237) (“the principal Regulations”). The principal Regulations make provision for the purposes of giving effect to section 431D of the Income and Corporation Taxes Act 1988 (c 1) in relation to the meaning of “overseas life assurance business”.

Regulation 1 provides for citation, commencement and effect. Authority for the retrospective effect of the amendments is given by paragraph 58 of Schedule 8 to the Finance Act 1995 (c 4).

Regulation 2 introduces the amendments to the principal Regulations. The amendments take account of changes made by the Finance Act 2007 (c 11: “FA 2007”) and update the principal Regulations in other respects.

Regulation 3 amends regulation 2 (interpretation) to take account of amendments made by FA 2007.

Regulation 4 inserts a new regulation 3B (exclusion of business of friendly society which is exempt from tax) to exclude the tax exempt life assurance business of an insurance company from the principal Regulations. This regulation takes account of amendments made by FA 2007.

Regulation 5 amends regulation 4 (business which is overseas life assurance business: general) and is consequent upon the amendment made by regulation 7 of these Regulations.

Regulation 6 amends regulations 5, 7, 7A and 8 so as to replace references to a “branch” of an insurance company with references to a “permanent establishment” to take account of amendments made by the Finance Act 2003 (c 14: “FA 2003”).

Regulation 7 omits regulations 9, 10, 10A and 11 to take account of amendments made by FA 2007 to the definition of overseas life assurance business.

Regulation 8 amends regulation 12 (territories in which policy holders residing: general) and is consequent upon the amendment made by regulation 10 of these Regulations.

Regulation 9 amends regulations 13, 14 and 14A so as to replace references to a “branch” of an insurance company with references to a “permanent establishment” to take account of amendments made by FA 2003.

Regulation 10 omits regulations 15, 16 and 16A to take account of amendments made by FA 2007 to the definition of overseas life assurance business.

Regulation 11 amends regulation 18 (reclassification of policy or contract from date when it was effected) to take account of amendments made by FA 2007 and to make minor corrections.

Regulation 12 amends regulation 19 (reclassification of policy or contract from date after it was effected) to take account of amendments made by FA 2007 and to make minor corrections.

These Regulations, together with the relevant legislation in FA 2007, are part of the outcome of a continuing consultation process. A draft regulatory impact assessment was included as part of a consultation document, “Life Assurance Company Taxation—A Technical Consultative Document”, which was published by Her Majesty's Revenue and Customs in May 2006. This is available at www.hmrc.gov.uk/consultations.

Financial Institutions94 Company Law & Business Entities95 Companies & Corporate Bodies95 Banking & Finance Law94 Transnational & Multinational Companies91