Search results for "Solvency"
showing 10 items of 110 documents
The Puzzle of the New European COMI Rules: Rethinking COMI in the Age of Multinational, Digital and Glocal Enterprises
2019
EU Regulation 2015/848 (Recast) laid down new rules on the debtor’s ‘centre of main interests’ (COMI) both to make it easier to determine international jurisdiction and to prevent a debtor from fraudulently relocating his/her/its COMI from one Member State to another. However, the terms of the litigation concerning the NIKI case and an in-depth analysis of the Recast demonstrate that this operation has been unsuccessful. This paper argues: first, that the new COMI rules contain logical and teleological flaws; secondly, that the prerequisite that the COMI ‘shall be the place […] which is ascertainable by third parties’ is a duplicate of the prerequisite ‘on a regular basis’; thirdly, that th…
Harmonization of Insurance Supervisory Law
2015
This chapter addresses the fundamental issue of what degree of harmonization applies in the Solvency II system. Distinguishing among the several degrees of harmonization—minimum harmonization, maximum harmonization, and full harmonization—leads to the conclusion that the Solvency II Directive has full harmonization as its objective. This has two important ramifications: First, the Solvency II Directive requires that any insurance supervisory regime implementation by the respective national legislators must completely align with the European insurance supervisory regime. Second, a system of full harmonization prohibits national legislators from unilaterally enacting additional measures not p…
From ‘Prisoner's Dilemma’ to Reluctance to Use Judicial Discretion: The Enemies of Cooperation in European Cross-Border Cases
2017
This article will focus on Articles 41–44 of the Recast European Insolvency Regulation (Regulation 2015/848) and the dynamic of cooperation and communication between courts and insolvency practitioners. Two main ideas will be maintained. The first is that cooperation requires a legal framework which is certain—otherwise, prescriptions imposing duties of cooperation and communication might produce ‘prisoner's dilemmas’ and, paradoxically, unwillingness to cooperate. The second idea is that prescriptions imposing duties of cooperation and communication have an intrinsic open texture—this characteristic ontologically requires courts and insolvency practitioners to make choices between differen…
Opening the Door for the Opportunistic Use of Interim Financing: A Critical Assessment of the EU Draft Directive on Preventive Restructuring Framewor…
2018
The draft of the EU Directive on Preventive Restructuring Frameworks and Second Chance (the "Directive") provides rules for adopting reorganisation plans in order to avoid insolvency. The draft Directive also provides rules on the related problem of interim financing. According to the draft Directive, interim financing should be encouraged and not be made subject to clawback unless parties have committed fraud or acted in bad faith. The Directive thereby fails to recognise that finance transactions are too diverse in nature to provide the company and its financial creditors with a transaction avoidance free period. If the Directive is adopted in its current form, it will open the door for o…
CLUSTER IMPACT ON COMPANY CREDITWORTHINESS: CASE OF LATVIA
2013
One of the leading driving forces of every state economy is small and medium enterprises (SME). In Latvia, SME accounts for 99.7% of the national industrial system, creating 70% of the national’ value added. The lack of sufficient capital and credit is often a major problem for the development of SME, particularly in their early growth stages. The main criterion and quality indicator of credit risk assessment is the borrower’s creditworthiness. Before issuing a loan, the checking of the borrower’s credibility and solvency is carried out. The assessment of the borrowers’ ability to pay, their creditworthiness at a definite moment must be connected with the ability to meet their liabilities i…
Case Study Regarding Solvency Analysis, during 2006-2012, of the Companies having the Business Line in Industry and Construction, Listed and Traded o…
2014
Abstract Beyond the financial performance assessed on the basis of profit and loss account, evaluating a company is made from the perspective of its ability to cope with due debts. A situation that was often encountered by companies listed on the BSE was insolvency, currently affecting six companies, while other have emerged from this process, being traded since November 2013. Considering the companies listed on BSE among the best performing, in this paper, which is part of a larger study, has been analyzed the ability of companies to meet medium and long term maturities, particularly from their own resources, and the way the financial crisis affected it.
Sustainable and Conventional Banking in Europe
2020
At the end of the 20th century a new banking model, the so-called ethical banking, emerged becoming the maximum exponent of a socially responsible investment. The financial crisis in 2008 led to a distrust of the conventional financial system and consequently investors began to look with interest this new banking, which only invests in ethical activities and products, with social and environmental criteria, total transparency and a democratic management. The aim of this article is to analyze the economic structure of ethical banking, compared to that of conventional banking, by paying attention to its liquidity, coverage and solvency. Specifically, We compare the financial statements of Tri…
Social Insurance Accounting for a Notional Defined Contribution Scheme Combining Retirement and Long-Term Care Benefits
2018
This paper develops a social insurance accounting model for a notional defined contribution (NDC) scheme combining retirement and long-term care (LTC) contingencies. The procedure relies on standard double-entry bookkeeping and enables us to compile a “Swedish” type actuarial balance sheet (ABS) following a framework equivalent to an open group approach. This methodology is suitable for reporting the system’s solvency status and can show periodical changes in the system’s financial position by means of an income statement. The information underpinning the actuarial valuation is based on events and transactions that are verifiable at the valuation date, without consid…
Fitness of Members of Supervisory Board
2015
This chapter deals with the fitness of members of supervisory boards. Since 2009, German insurance regulatory law has provided internal qualification standards for the supervisory board members of insurance companies. In accordance with Paragraph 7a, sec. 4, clause 1 of the VAG [German Insurance Supervision Act], the members of supervisory boards must be able to fulfill their tasks and supervisory functions in accordance with their level of expertise. This new requirement comports with the previous standards of German corporate law, established by the BGH [German Federal Court of Justice] in its “Hertie”-ruling. As such, this ruling will also serve as a basis to interpret the expertise requ…
Testing for Government Intertemporal Solvency: A Smooth Transition Error Correction Model Approach
2001
Applied macroeconomists have tested for the government intertemporal solvency condition by either testing for linear stationarity in the total government deficit series or testing for linear cointegration between total government spending and total tax revenues. A number of authors have focused, in particular, on structural breaks in the government deficit process. In this paper, we use a smooth transition error correction model to test and estimate a shift in the adjustment toward a linear cointegration relationship between the government spending to output ratio and the total tax revenues to output ratio. Estimation results show that government authorities react only to large (in absolute…