§ Sir David Priceasked the Minister for Trade why no progress has yet been made within the European Economic Community to agree a directive for the freedom of life insurance services; and what steps the Government intend to take to ensure that such a directive is agreed.
§ Dr. VaughanNo proposal for a life insurance services directive has yet been put forward by the Commission. It is doubtful whether it would at present be profitable for the Community to divert its attention to this subject from the other important proposals on insurance currently before it.
§ Sir David Priceasked the Minister for Trade what progress is being made within the European Economic Community to agree a directive for the freedom of non-life insurance services; and what are the obstacles to such progress.
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§ Dr. VaughanThough discussions on the draft non-life insurance services directive have continued since our Presidency last year, progress towards agreement on the main issues have been minimal. The main obstacle to progress remains the reluctance of some other member States to relinquish administrative controls over the terms on which the insurance of, in particular, industrial, commercial and professional risks, is transacted. Another difficulty to be resolved is the desire of the French Government to charge value added tax on insurance, against which a large majority of member States and the Commission have strong reservations.
It has proved difficult against this background to resolve a number of other technical problems, including the question of what country's law should be applicable to international insurance contracts.