1.1 Form ‘1’ – view here – (or Form ‘5’ in respect of Long Term insurers) consolidates all of the information required for the timely and efficient processing of an application. Along with it should be submitted Form A of Schedule 2 which contains details of directors, controllers etc. of the company. Form 1 (5) comprises 21 (23) questions covering such decision processes as:
1.2 Submission of Form 1 or 5 (the Application) requires the following supporting documents:
2.1 Incorporation of Company requires –
a) Approval and Filing of Name with Registrar, following name approval by the Financial Services Commission
b) Filing of Memorandum and Articles of Association, and other statutory documents (return of directors, declaration of registered office, declaration of compliance, declaration of nominal capital, return of share allotments)
c) Payment of Stamp Duty on nominal share capital (Fixed amount of £10)
d) Payment of incorporation fee to Companies House (£50 or £100 for same day incorporation)
2.2 Any special issues regarding tax status should be referred to the Commissioner for Income Tax at this stage.
2.3 Bank accounts do not necessarily all have to be in Gibraltar but capital must be in an EEA state to be admissible.
2.4 On approval of the Application the appropriate annual licence fee (depending on the type of company) must be remitted to the Financial Services Commission (FSC) prior to the issue of the licence (the appropriate Application Fee is paid with submission of application) – Details of fees for insurance companies are here
2.5 For an insurance company, the ideal composition from the regulator’s point of view should contain two executive directors (insurance manager staff are considered executive) and one independent Non-Executive Director, all of whom are based in Gibraltar. At least one director must have insurance knowledge – they can be the same as one of those mentioned. All directors, controllers and managers will need to pass the FSC fit and proper person criteria – read the criteria here.
2.6 The Application will need to clearly demonstrate that management and control is based in Gibraltar, especially if the Applicant intends to trade in another EU territory via a branch, and will need to show that the operation fulfils the FSC Four Eyes principle (read it here). It is usual to obtain a legal opinion from a Gibraltar legal firm to support this.
2.7 With implementation of Solvency II imminent, applications will now need to be accompanied by a calculation of solvency on a Solvency II basis. Actuarial assistance may be required for this, depending on the complexity of the project.
3.1 Appointment of Representatives:
3.2 Check company name with Gibraltar Companies House
3.3 Complete Preliminary Application papers and Business Plan (Form 1/5, Schedule 2 etc)
3.4 Submit Licence Application to the FSC (with application fee) and request permission to use the word “insurance” in the company name
3.5 Respond to any queries or requests for further information from FSC
3.6 Incorporate the Company in Gibraltar (including application for tax status if relevant)
3.7 Open Bank accounts
3.8 Remit Share Capital to the Company’s bank account
3.9 Obtain auditor’s statement evidencing paid-up capital, as well as actuarial certificate if appropriate
3.10 FSC will indicate their willingness to issue a licence, with any prior conditions (e.g. employment of senior staff etc.) and will submit a draft Notice of Requirements*, whereupon auditor’s statement re capital should be submitted to them along with payment of annual licence fee
3.11 Issuance of Licence and NoR*
3.12 Completion of any notification requirements to passport into another EEA territory (see FSC Insurance Guidance Note 10)
3.13 Start Trading!
*Notice of Requirements (NoR) is a document issued by the FSC at the same time of the licence which covers any restrictions or reporting requirements the FSC wishes to impose on the company. Examples would be quarterly returns, notification of connected party transactions, provision of final signed versions of contracts and reinsurance treaties within a month of licencing etc.