Arbitration Court Confirms Legality of EIG Re and Euroins Contract

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On 2nd July 2024, the International Arbitration Court at the Institute of Private International Law took a decision on the arbitration case, initiated by Insurance Company EIG Re EAD (EIG Re) in relation to the Reinsurance Contract (the Reinsurance Contract), concluded on 9th February 2023, between EIG Re and Euroins Romania – Asigurare Reasigurare S.A. (Euroins Romania), a subsidiary of Euroins Insurance Group AD.

The decision fully confirms the arbitrage claim by EIG Re, including by:

  • confirmation that the Reinsurance Contract is concluded in compliance with all requirements of the Bulgarian legislation (applicable legislation in relation to the Reinsurance Contract);
  • confirmation that the Reinsurance Contract is fully effective and there are no conditions for partial and/or full nullity of any of the clauses and/or the Reinsurance Contract;
  • confirmation that the Reinsurance Contract was lawfully terminated on 17th March 2023;
  • confirmation that as a result of the lawful termination of the Reinsurance Contract, the minimum and deposit premium is lawfully retained by EIG Re.

The current decision of the Arbitration Court confirms that the actions of the Management of EIG Re, Euroins Romania, as well as Euroins Insurance Group, had been lawful and carried-out fully in compliance with the requirements of the applicable Bulgarian legislation.

The actions of the Management of Euroins Insurance Group were fully focused on the provision of the necessary support of the solvency position of Euroins Romania and the Reinsurance Contract was one of the key instruments in this process.

The current Arbitration Decision confirms that the steps, taken by the Management of Euroins Insurance Group, had been sufficient and lawful for ensuring the necessary support of the Group’s Romanian subsidiary. It also confirms that the reasons for the revocation of the license of Euroins Romania had been purely related to the highly questionable actions of the former management of the Romanian financial regulator (ASF), which have led to significant deteriorating effects over the rights of all policyholders.

The Management of Euroins Insurance Group continues its due process of defending the interest of all stakeholders and policyholders.

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