ABSTRACT
In deciding what techniques of supervision were to be applied to insurance undertakings operating across national borders under the Single Passport system a fundamental choice had to be made between regulation by the home State of the undertaking concerned and regulation by the host State in which the undertaking operates. This chapter discusses the provisions of the Third generation of Directives, which seek to implement the system of home country regulation. The Third Directives seek to complete the Internal Market from the point of view of both freedom to provide services and right of establishment. The third recital to the Directive is a reminder that the Second Directives largely created an Internal Market for commercial policyholders especially in relation to large risks, but that this Internal Market did not extend to other policyholders or categories of risks.
