For several legal forms of incorporation, European statutes exist (European Company Statute, European Cooperative Society Statute, European Economic Interest Grouping) or are under consideration (European Foundation Statute, European Private Company Statute for SMEs).
Many mutual insurance undertakings among AMICE’s membership deplore the fact that no work is currently being undertaken at the level of the European institutions with regard to a European statute for mutuals.
History
Efforts to develop a European Mutual Statute date back to the early nineties. A Commission proposal of 1993 (revised in 1996) was discussed in Council, but never got beyond that discussion stage.
In 2003, the Commission launched a consultation document on “Mutuals in an Enlarged Europe” to which AISAM and ACME, the predecessor associations of AMICE, responded extensively, as did AIM, several national mutuals’ associations and individual insurance undertakings. In the feedback summary, the Commission states that (with one exception) “all replies to the question on the need for a European statute for mutual societies ... consider that such a statute is necessary”.
In September 2005 the draft Regulation on a European Mutual Society Statute (EMS), whose legislative process was seen by the European Commission as lacking substantial progress, was removed from the European agenda.
Between 2005 and 2007, AMICE (at the time its two predecessor organisations, ACME and AISAM) and AIM jointly prepared a new draft regulation for an EMS with the aim of convincing the European Commission to relaunch its work on such a statute. Since the publication of the draft text in the autumn of 2007, the associations have continued their work, focusing on explaining to all parties involved the issues at stake and the importance of the project for the mutual sector in Europe (see Explanatory Memorandum).
Within AMICE, the work on the EMS is covered by the EMS task force of the Legal Affairs Working Group.
It is worth noting that the European Parliament has over the past years in several contexts expressed its support for the introduction of a European Mutual Statute and underlined its importance.
Objectives of an EMS
In the short term, the main objective of an EMS as seen by AMICE is to provide equal competitive conditions between limited liability companies, cooperatives and mutual insurance companies: the EMS should enable the mutual insurance sector to compete on equal footing, both at national and cross-border levels. In the longer term, an EMS could also become a valuable tool to promote the mutual society model in countries where the model does not or barely exist.
Main characteristics of AMICE’s and AIM’s draft statute
- Like the other existing European statutes, the EMS is non-compulsory; mutuals should be able to avail themselves of this legal form if they wish but it should not be imposed.
- It is designed to be activity neutral and thus could be used for insurance mutuals, health mutuals or indeed mutuals providing any other type of activity.
- Its object is to provide a European framework for undertakings that want to provide goods and services in the interest of their clients who are their members. Mutuals are owned by their client-members and have no share capital as such. Members do not have a right on the net assets (see below for liquidation principles). Mutuals have a governance model based on democracy.
- Among the numerous ways an EMS can be formed the most important ones are:
• by creation, decided by at least two mutual societies, including or not their subsidiaries which fall within the law of at least two different Member States; or by five or more natural persons resident in at least two Member States;
• by conversion of a mutual society, including or not its subsidiaries;
• by merger of mutual societies including or not their subsidiaries which have their registered office and head office within the European Union, if at least two of them fall within the law of two different Member States
- Upon liquidation of an EMS, net assets shall be distributed in accordance with the principle of disinterested distribution, or, where permitted by the law of the Member State in which the EMS has its registered office, in accordance with an alternative arrangement set out in the statutes of the EMS.