Prohibition or restriction of a qualifying holding

(1) In the cases under section 17(1), first sentence, points 1 or 2, the supervisory authority may, within the assessment period, prohibit the intended acquisition of the qualifying holding or its increase, where facts justify the assumption that 1. the person subject to the notification duty or, where that person is a legal person, a statutory or constitutional representative, or, where it is a commercial partnership, a partner, is not reliable or otherwise does not meet the requirements to be set in the interest of a sound and prudent management of the insurance undertaking; this is also the case where the acquirer of the qualifying holding cannot demonstrate that he or she has appropriate business plans for the continuation and development of the insurance undertaking's business and that the interests of policyholders or the legitimate interests of the ceding insurers are sufficiently safeguarded; further, section 11(1), point 3, second half-sentence, applies correspondingly; 2. the insurance undertaking is not able, or will not remain able, to meet the supervisory requirements, or that the insurance undertaking would, through the establishment or increase of the holding, become integrated with the holder of the qualifying holding into an association of undertakings that, through the structure of the network of participations or through inadequate economic transparency, may impair effective supervision of the insurance undertaking, or an effective exchange of information between the competent bodies, or the determination of the allocation of responsibilities between those bodies; 3. the insurance undertaking would, through the establishment or increase of the qualifying holding, become a subsidiary undertaking of a third-country insurance undertaking that is not effectively supervised in the state of its registered office or head office, or whose competent supervisory body is not prepared to cooperate satisfactorily; 4. the future manager is not reliable or not professionally qualified; 5. money laundering or terrorist financing within the meaning of Article 1 of Directive 2005/60/EC of the European Parliament and of the Council of 26 October 2005 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing (OJ L 309, 25.11.2005, p. 15) is taking place, has taken place, or has been attempted in connection with the intended acquisition or increase of the holding, or the intended acquisition or increase could increase the risk of such conduct; or 6. the person subject to the notification duty does not have the necessary financial soundness, in particular having regard to the nature of the insurance undertaking's actual and planned business; this is in particular the case where, on account of his or her capital endowment or asset situation, the person subject to the notification duty cannot meet the particular requirements of the insurance undertaking arising from its capital endowment or liquid funds, needed to ensure the continued capacity of the obligations under the insurance contracts to be fulfilled or to avoid liquidity shortfalls.
(2) The supervisory authority may also prohibit the acquisition or increase of the holding where the particulars under section 17(1), first sentence, points 1 and 2, or the information additionally requested under section 17(4), third sentence, are incomplete or incorrect; the supervisory authority may neither impose preconditions as to the size of the holding to be acquired or of the intended increase of the holding, nor may it, in its examination, have regard to the economic needs of the market.
(2a) In the cases under subsection (1), instead of prohibiting the intended acquisition of the qualifying holding or its intended increase, and in the cases under section 17(1), second sentence, point 1, the supervisory authority may, within the assessment period, also issue orders to the person subject to the notification duty that are suitable and necessary to create facts that no longer justify the assumption of the grounds for prohibition named in subsection (1).
(3) Where the supervisory authority decides, after completing the assessment, to prohibit the acquisition or the increase of the holding, or to issue an order under subsection (2a), it must communicate the decision to the person subject to the notification duty in writing or electronically, stating the reasons, within two working days and within the assessment period. Remarks and reservations of the authority responsible for the person subject to the notification duty must be reproduced in the decision; a prohibition may be issued only on the grounds named in subsections (1) and (2); an order under subsection (2a) may be issued only on the grounds listed in subsection (1). Where the acquisition or the increase of the holding is not prohibited in writing or electronically within the assessment period, the acquisition or increase may be completed; this does not affect the supervisory authority's rights under section 20. Where the acquisition or increase of the holding is not prohibited, the supervisory authority may set a time limit, upon the expiry of which the person subject to the notification duty must notify it without delay of the completion or non-completion of the intended acquisition or increase.