1.Member States shall provide that the competent authorities exercise general supervision over transactions between:
an insurance undertaking and:
a related undertaking of the insurance undertaking;
a participating undertaking in the insurance undertaking;
a related undertaking of a participating undertaking in the insurance undertaking;
an insurance undertaking and a natural person who holds a participation in:
the insurance undertaking or any of its related undertakings;
a participating undertaking in the insurance undertaking;
a related undertaking of a participating undertaking in the insurance undertaking.
These transactions concern in particular:
loans,
guarantees and off-balance-sheet transactions,
elements eligible for the solvency margin,
investments,
reinsurance operations,
agreements to share costs.
2.►M1 Member States shall require insurance undertakings to have in place adequate risk management processes and internal control mechanisms, including sound reporting and accounting procedures, in order to identify, measure, monitor and control transactions as provided for in paragraph 1 appropriately. Member States shall also require at least annual reporting by insurance undertakings to the competent authorities of significant transactions. These processes and mechanisms shall be subject to overview by the competent authorities. ◄
If, on the basis of this information, it appears that the solvency of the insurance undertaking is, or may be, jeopardised, the competent authority shall take appropriate measures at the level of the insurance undertaking.