Superintendent of Insurance. Changes in the share transfer approval process

By means of Resolution No 32,582/2007, published in the Official Gazette on 27 November 2007, the Superintendent of Insurance added a Section 7 to “General Regulations of the Insurance Activity” that collates and updates the different resolutions, orders and communications which had been issued by the Superintendent concerning shareholders, share transfers, corporate domicile, registry of signatures, and data reporting by managers and in-house auditors of insurance companies.

An important aspect of Resolution No 32,582/2007 is that it abrogates Section 4 of Circular No 3761, which permitted share transfers and capitalizations of irrevocable capital contribution without seeking the prior Superintendent’s approval provided the relevant shareholder had one of the follow credit ratings: A.M. Best: minimum rating: B++ or B+ Very GOOD; Standard & Poor’s: minimum rating: BBB-ADEQUATE; Moody’s: minimum rating: Baa-adequate; Duff & Phelps minimum rating: BBB+ or BBB-ADEQUATE; IBCA: minimum rating: BBB-ADEQUATE.

This change, according to the recitals of Resolution No 32,582/2007, responds to the obligations imposed on the Superintendent by the Money Laundering Law No 25,246.

With this change, any share transfer or capitalization of irrevocable capital contributions must be previously approved by the Superintendent if as a consequence of such transaction the shareholder ends up holding 5% or more of an insurer’s stockholding.