The government has published the Risk Transformation Regulations 2017 (Regulations), which come into force on 8 December 2017, following publication of the draft text by HM Treasury in July.   The Regulations enable the creation of a new form of body corporate: a “protected cell company,” which can act as a special purpose vehicle in Insurance Linked Securities for the purposes of risk mitigation under the Solvency II Directive.

The Regulations are part of a framework of measures also being developed by the PRA and FCA for the authorisation and supervision of insurance special purpose vehicles (ISPVs), upon which we reported a year ago, and which the PRA and FCA have been working on during 2017.