Order on the Merger of Mutual Insurance Companies or Cross-Border Pension Funds and Others

Order on the Merger of Mutual Insurance Companies or Cross-Border Pension Funds and Others

Pursuant to Section 196 and Section 248 of Act No. 718 of 13 June 2023 on Insurance Business, it is hereby ordered:

Scope of Application

Section 1. This Order applies to cases where

1. a mutual insurance company merges with a mutual insurance company or a joint-stock company, and
2. a cross-border pension fund merges with a cross-border pension fund or a joint-stock company.

Merger of Mutual Insurance Companies

Section 2. In the event of a merger of mutual insurance companies, Section 237, subsection 1, subsection 3, items 1, 2, 5, 6, and 8-10, and subsection 4, Section 238, subsection 1, first sentence, Section 239, subsection 1, Section 241, subsections 2 and 3, Section 242, first sentence, Sections 243 and 244, Section 245, subsections 1 and 3-5, subsection 6, items 1-4 and 7, and subsection 7, Section 246, subsections 1 and 5, Section 247, Section 248, subsection 1, Section 250, subsection 1, items 1 and 2, and Section 251, subsections 1 and 2, of the Companies Act shall apply with the necessary adjustments and with the deviations that follow from the Insurance Business Act and the special legal character of mutual insurance companies.

Subsection 2. In mergers under subsection 1 and in accordance with Section 195, subsection 10, of the Insurance Business Act, "the Business and Services Authority" in Section 243, subsection 1, Section 244, subsection 2, second sentence, Section 245, subsection 1, and Section 247, subsection 2, of the Companies Act shall be understood as "the Financial Supervisory Authority", "the Business and Services Authority" in Section 244, subsection 1, of the Companies Act shall be understood as "the Financial Supervisory Authority", "the Business and Services Authority's IT system" in Section 244, subsection 2, first sentence, of the Companies Act shall be understood as "the Official Gazette of the Financial Supervisory Authority", and "the Authority" in Section 251, subsection 2, of the Companies Act shall be understood as "the Financial Supervisory Authority".

Subsection 3. In mergers under subsection 1, the following provisions of the Companies Act shall further be understood as follows:

1. In Section 237, subsection 3, items 5 and 6, "shareholdings and debt instruments" and "shares and debt instruments" shall be understood as "debt instruments".
2. In Section 239, subsection 1, second and third sentences, "the Accounting Act" shall be understood as "the Order on Financial Reporting for Insurance Companies and Cross-Border Pension Funds".
3. In Section 245, subsections 6 and 7, "the shareholders" and "Shareholders" shall be understood as "the members" and "Members".
4. In Section 246, subsection 1, "the shareholders" shall be understood as "those entitled thereto".
5. In Section 246, subsection 5, and Section 247, subsection 4, "Section 106" shall be understood as "Section 243 of the Insurance Business Act".
6. In Section 247, subsection 2, "Shareholders who own 5 percent of the share capital, or the shareholders who, according to the articles of association, cf. Section 89, can demand that the general meeting be convened" shall be understood as "5 percent of the members".

Merger of a Mutual Insurance Company and a Joint-Stock Company

Section 3. In the event of a merger of a mutual insurance company and a joint-stock company, Section 237, subsections 1, 3, and 4, Section 238, subsection 1, Section 239, subsection 1, Section 240, Section 241, subsection 1, first sentence, and subsections 2-4, Section 242, first sentence, Section 243, Section 244, Section 245, subsections 1 and 3-7, Sections 246 and 247, Section 248, subsection 1, Sections 249-251, of the Companies Act shall apply with the necessary adjustments and with the deviations that follow from the Insurance Business Act and the special legal character of mutual insurance companies.

Subsection 2. In mergers under subsection 1 and in accordance with Section 195, subsection 10, of the Insurance Business Act, for insurance joint-stock companies and mutual insurance companies, "the Business and Services Authority" in Section 243, subsection 1, Section 244, subsection 2, second sentence, Section 245, subsection 1, and Section 247, subsection 2, of the Companies Act shall be understood as "the Financial Supervisory Authority", "the Business and Services Authority" in Section 244, subsection 1, of the Companies Act shall be understood as "the Financial Supervisory Authority", "the Business and Services Authority's IT system" in Section 244, subsection 2, first sentence, of the Companies Act shall be understood as "the Official Gazette of the Financial Supervisory Authority", and "the Authority" in Section 251, subsection 2, of the Companies Act shall be understood as "the Financial Supervisory Authority".

Section 4. In the case referred to in Section 3, where the merging company is a mutual insurance company, the following provisions of the Companies Act shall further be understood as follows with regard to the mutual insurance company:

1. In Section 237, subsection 3, item 3, Section 238, subsection 1, second sentence, and Section 241, subsection 4, first sentence, "the consideration for the shareholdings" shall be understood as "the consideration for the equity".
2. In Section 239, subsection 1, second and third sentences, "the Accounting Act" shall be understood as "the Order on Financial Reporting for Insurance Companies and Cross-Border Pension Funds".
3. In Section 245, subsections 6 and 7, "the shareholders" and "Shareholders" shall be understood as "the members" and "Members".
4. In Section 246, subsection 1, "the shareholders" shall be understood as "those entitled thereto".
5. In Section 246, subsection 5, "Section 106" shall be understood as "Section 243 of the Insurance Business Act".

Subsection 2. Section 246, subsections 2-4, and Section 249 of the Companies Act shall not apply to the mutual insurance company.

Subsection 3. If the consideration for the equity in the mutual insurance company is paid in shares in the surviving joint-stock company, the acquirer becomes a shareholder in the surviving company simultaneously with the conditions in Section 250, subsection 1, of the Companies Act being fulfilled.

Subsection 4. If the mutual insurance company has guarantee capital, it shall be repaid to the guarantors before the merger.

Section 5. In the case referred to in Section 3, where the surviving company is a mutual insurance company, the following provisions of the Companies Act shall further be understood as follows with regard to the mutual insurance company:

1. In Section 239, subsection 1, second and third sentences, "the Accounting Act" shall be understood as "the Order on Financial Reporting for Insurance Companies and Cross-Border Pension Funds".
2. In Section 245, subsections 6 and 7, "the shareholders" and "Shareholders" shall be understood as "the members" and "Members".
3. In Section 247, subsection 2, "Shareholders who own 5 percent of the share capital, or the shareholders who, according to the articles of association, cf. Section 89, can demand that the general meeting be convened" shall be understood as "5 percent of the members".
4. In Section 247, subsection 4, "Section 106" shall be understood as "Section 243 of the Insurance Business Act".

Subsection 2. If a joint-stock company is dissolved without liquidation by the transfer of the company's assets and liabilities as a whole to a mutual insurance company that owns all the shares in the merging company, Section 252 of the Companies Act shall apply with the necessary adjustments.

Merger of Cross-Border Pension Funds and Others

Section 6. In the event of a merger of cross-border pension funds, Section 2 shall apply correspondingly with the necessary adjustments and with the deviations that follow from the Insurance Business Act and the special legal character of cross-border pension funds.

Subsection 2. In the event of a merger of a cross-border pension fund and a joint-stock company, Sections 3-5 shall apply correspondingly with the necessary adjustments and with the deviations that follow from the Insurance Business Act and the special legal character of cross-border pension funds to the cross-border pension fund.

Subsection 3. If the surviving company is an occupational life insurance joint-stock company, cf. Section 250 of the Insurance Business Act, the provisions in Section 2 regarding a merging mutual insurance company shall apply correspondingly to a merging cross-border pension fund.

Entry into Force

Section 7. This Order enters into force on 1 January 2025.

Subsection 2. Order No. 194 of 1 March 2012 on the Merger of Mutual Insurance Companies or Cross-Border Pension Funds and Others is repealed.

Ministry of Industry, Business and Financial Affairs, 5 December 2024 Louise Mogensen / Line Bergmann