In very broad terms, the overriding principle is that where a company or individual acquires 10% or more of the shares and/or voting interests in an underwriting agent or approved run-off company or its parent company, the firm needs prior approval from the PRA, FCA and Lloyd’s.

What is the new process?

Where there is a proposed change of control in respect of an underwriting agent or approved run-off company, the following procedure should be adopted:

  1. Informal notification to Lloyd’s Head of Risk Management, Senior Operational Risk Manager or Risk Executive;

  2. Electronic notification to Lloyd’s of the intention to change a controller and confirmation that any tax implications have been explored with Lloyd’s Tax Department;

  3. Lloyd’s has 3 working days to respond to the initial notification and raise any immediate issues or to exercise its right to challenge;

  4. Detailed due diligence is then undertaken by Lloyd’s (further information on potential areas for consideration are detailed below);

  5. The firm subsequently submits the application to the PRA and FCA;

  6. The firm notifies Lloyd’s when PRA and FCA approval is granted; and

  7. Lloyd’s gives written approval once satisfied with all aspects of the transaction (including financing, Group and investors);

  8. Lloyd’s reserves the right to reject an application or perform additional due diligence as material information is presented.

     

Where can I find more information?

Changes of Control Processes

Market Bulletin Y4126 (60KB) was issued on 22 February 2008.