Authorisation of the termination of a voluntary mutual insurance fund activity

With the exception of liquidation, the fund can only be terminated after voluntary winding up. The MNB passes a resolution authorising the discontinuation of voluntary fund activity.

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At least three general meetings must be held during the voluntary winding up procedure. (If the MNB gives notice, it may become necessary to convene additional general meetings during a voluntary winding up procedure.) If the decision was made to terminate a fund without legal succession, the intention to terminate the fund must be reported to the MNB after the first general meeting. An application for authorisation to discontinue activities must be submitted within 30 days of the third general meeting. All balance sheets to be prepared during the voluntary winding up procedure must be submitted to the MNB substantiated by an itemised inventory and certified by an auditor.

More detailed information about the process of the voluntary winding up procedure can be found at: https://www.mnb.hu/letoltes/4-1-1-4-1-engedelyezesi-utmutato-onkentes-kolcsonos-biztosito-penztar-tevekenyseg-lezarasanak-engedelyezese-vegelszamolas-soran.pdf

The voluntary winding up procedure must be carried out within one year of the date of the decision thereon. At the fund’s request, the MNB may grant a one-time extension not exceeding one year. If the final statement of accounts is not approved and the voluntary winding up procedure is not concluded within 1 year or by the extended deadline specified by the MNB, the Supervisory Authority may initiate the liquidation of the fund through the court.

The intention to terminate the fund must be reported to the MNB after the first general meeting. An application for authorisation to discontinue activities must be submitted within 30 days of the third general meeting.

The administrative time limit is three months starting from the working day following receipt of the application by the MNB.

If the application does not comply with the statutory requirements or it is deemed necessary for ascertaining the relevant facts of the case, the MNB will advise the applicant customer within forty-five days to remedy the deficiencies, also indicating the legal consequences of non-compliance. The MNB is entitled to repeatedly advise the applicant to remedy the deficiencies during the procedure. If the MNB has advised the applicant to remedy the deficiencies, the administrative time limit will be calculated from the day on which the deficiencies are remedied in full.

A detailed guide to the discontinuation of voluntary mutual insurance fund activity is available at: https://www.mnb.hu/letoltes/4-1-1-4-1-engedelyezesi-utmutato-onkentes-kolcsonos-biztosito-penztar-tevekenyseg-lezarasanak-engedelyezese-vegelszamolas-soran.pdf

An FAQ (frequently asked questions and answers) page on the discontinuation of voluntary mutual insurance fund activity can be accessed at the following link:

https://www.mnb.hu/letoltes/4-1-1-4-2-gyakori-kerdesek-es-valaszok-onkentes-kolcsonos-biztosito-penztar-tevekenysege-lezarasanak-engedelyezesevel-kapcsolatban.pdf

The authorisation procedure for the discontinuation of activities is free of charge.

Magyar Nemzeti Bank, Insurance and Pension Funds Licensing and Legal Enforcement Department

The MNB’s decision (resolution or ruling) may not be appealed; however, customers whose rights or legitimate interests are directly affected by the decision may initiate administrative court proceedings within 30 (thirty) days of the disclosure of the resolution or ruling on the grounds of infringement, by submitting an application initiating proceedings to the Budapest-Capital Regional Court.

Legal representation is mandatory in the court proceedings. The application must be addressed to the Budapest-Capital Regional Court, and submitted electronically through the MNB’s form submission support service.

(The form submission support service can be accessed at: https://www.mnb.hu/felugyelet/engedelyezes-es-intezmenyfelugyeles/hatarozatok-es-vegzesek-keresese)

The submission of the application has no suspensive effect on the enforceability of the resolution or ruling, but the customer may request interim relief. As a general rule, the court rules in the proceedings without holding a hearing; however, the customer may request a hearing in the application. If no hearing is requested, a hearing may not be requested later on during the appeal procedure.

An application for a remedy may be lodged by any party who goes over a time limit or misses a legal deadline during the procedure for reasons beyond their control.

Additional general information about the authorisation procedure is available at: https://www.mnb.hu/felugyelet/engedelyezes-es-intezmenyfelugyeles/engedelyezes/tajekoztatok

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