European Commission Adopts Delegated Regulation Amending Solvency II Delegated Regulation on Treatment of infrastructure and ELTIF Investments

The European Commission has adopted a Delegated Regulation amending the Solvency II Delegated Regulation (EU 2015(35)) concerning the calculation of regulatory capital requirements for several categories of assets held by insurance and reinsurance undertakings, in particular infrastructure investments and investments in European long-term investment funds (ELTIFs).

The aim of the amending Regulation is to remove specific regulatory impediments to the financing of long-term investment projects by insurers. The revisions made to the Solvency II Delegated Regulation relate to issues including:

  • Infrastructure investments. The amending Regulation introduces a specific treatment in the solvency capital requirements for infrastructure investments (being investments in special purpose entities that own, finance, develop or operate infrastructure assets that provide or support essential public services).
  • Investments in ELTIFs. The amending Regulation extends to ELTIFs the provisions in the Solvency II Delegated Regulation concerning the treatment of European venture capital funds and European social entrepreneurship funds.

The amending Regulation also contains provisions concerning the treatment of equities traded on multilateral trading facilities and the scope of the equity transitional measure in Article 173 of the Solvency II Delegated Regulation. The next step will be for the Council of the EU and the European Parliament to consider the amending Regulation. The Commission intends the amendments made by the amending Regulation to be in place as soon as possible.