§ Mr. Hindasked the Secretary of State for Trade and Industry if he will state his conclusions on the issues raised by the decision of the courts in the case of Bedford v. Inland Revenue Board and Stewart v. Oriental.
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§ Mr. FletcherThe Department has consulted the insurance industry about the implications of these judgments of the High Court. Comments have also been received from others interested in the approach adopted by the Department to determining whether authorisation to carry on insurance business in the United Kingdom is required under the Insurance Companies Act 1982.
Issues relevant to this subject are raised by certain cases brought before the European Court of Justice by the Commission of the European Communities. I intend to consider those judgments before coming to a firm view. Meanwhile individual cases will be considered as they arise.
I am however able to make clear the attitude which will be adopted towards past conduct which may appear from the High Court judgments to have been unlawful.
As at present advised, the Secretary of State does not expect to take action under Part I of the Insurance Companies Act 1982 or the corresponding provisions of earlier legislation—
- (a)in respect of the conduct of unauthorised overseas insurance companies who on or before the date of this statement effected or carried out contracts of insurance using arrangements and procedures in operation on or before 10 November 1983 under which either the effecting or the carrying out did not occur in the United Kingdom or the decision either to effect or to carry out was not taken in the United Kingdom; or
- (b)in respect of unauthorised overseas insurance companies whose insurance activities in the United Kingdom are in future limited solely to the discharge of obligations assumed under contracts of insurance effected on or before the date of this statement whether or not the contract was effected in contravention of section 2 of the Insurance Companies Act 1982 or a corresponding provision in earlier legislation; or
- (c)in respect of a United Kingdom agent where by virtue of (a) or (b) action would not be taken in respect of his principal overseas.
The Secretary of State will continue to take action in cases in which contracts were both effected and carried out in the United Kingdom through a branch office or an agent irrespective of when the arrangement in question was made, except in respect of the discharge of obligations falling within (b) above.